X

Sign up for Equitymaster's free daily newsletter, The 5 Minute WrapUp and get access to our latest Multibagger guide (2017 Edition) on picking money-making stocks.

This is an entirely free service. No payments are to be made.


Download Now Subscribe to our free daily e-letter, The 5 Minute WrapUp and get this complimentary report.
We hate spam as much as you do. Check out our Privacy Policy and Terms Of Use.
Global brands from Colgate - Views on News from Equitymaster
 
 
  • PRINT
  • E-MAIL
  • FEEDBACK
  • A  A  A
  • Feb 19, 2001

    Global brands from Colgate

    Colgate India is planning to widen its oral care and personal product portfolio. It aims to bring in some of its global brands in categories as diverse as household surface care, fabric care, personal care and pet foods.

    Presently personal care contributes a marginal 10% to Colgate India’s (CIL) revenues. It has leading brands such as ‘Palmolive’ ‘Halo’ and ‘Axion’ (dish washing detergent) in India. Its Palmolive brand has only 1% market share while in shaving gels and creams, it claims to have a 20% share. CIL has introduced its Halo shampoo brand as a low profile product to grow the revenues through volumes. However, the brand failed to capture market share in the wake of stiff competition. Similarly, Optima (shampoo brand) has been scrapped and Charmis (cold cream brand) commands a negligible market share.

    In contrast, Colgate’s parent has a diverse products portfolio in categories like household surface care, fabric care and personal care. The long-term strategy of CIL is to enter into these areas for growth opportunities. The products in India will be launched after test marketing and will either be manufactured or imported.

    Lets have a glance at Colgate’s worldwide brand portfolio in fabric care, household care and personal care.

    Fabric care:
    Colgate holds a leadership position in fabric softeners in almost every region with a wide choice of detergents, from laundry bars for hand washing, to powders and liquids. In fabric care Colgate’s brands include Ajax, ABC, Arctic, Dynamo and Fab detergents. Among fabric softeners, it has the Dunlet, Softlan and Soupline brands.

    Household care:
    In this segment Colgate has wide array of all-purpose cleaners, dish liquids and bleaches. It has brands like Palmolive dishwashing liquid and Ajax household cleaners.

    Personal care:
    Colgate is a worldwide leader in personal care products with quality brand names like Palmolive, Mennen, Irish Spring, Softsoap, Caprice and Protex.

    Pet nutrition:
    Hill's Pet Nutrition, Inc., a subsidiary of Colgate, is one of the world's leading pet food manufacturers. It is a pioneer in clinical nutrition for dogs and cats with its ‘Prescription Diet’ and ‘Science Diet’ brands. The segment accounts for 12% of Colgate’s worldwide sales.

    Needless to mention that globally Colgate is a leader in the oral care products.

    During the year ended December ’00, the $ 9.4 bn company reported an excellent performance with 6% volume growth. Colgate’s strong focus in launching new products and widespread market share gains coupled with operating efficiencies enabled it to achieve a sparkling 14% growth in profits. The company commands a share of 32.6% in the US toothpaste markets (US contributes 25% of its sales).

    Snapshot of Colgate’s performance
    (Rs m) FY00 FY01 Change
    Sales 424,179 435,330 2.6%
    Expenditure 351,319 354,343 0.9%
    Operating Profit (EBDIT) 72,860 80,987 11.2%
    Operating Profit Margin (%) 17.2% 18.6%  
    Interest 7,983 8,062 1.0%
    Profit before Tax 64,877 72,925 12.4%
    Tax 21,274 23,418 10.1%
    Profit after Tax/(Loss) 43,603 49,507 13.5%
    Net profit margin (%) 10.3% 11.4%  
    No. of Shares (eoy) (m) 638.8 627.3  
    Diluted Earnings per share 69.51 78.92  
    P/E (at current price)   35  

    Back to India, CIL’s topline showed an encouraging growth of 10% during the nine months ended December ’00 and profits jumped by 22%. The company will continue to focus on oral care segments as there exists a tremendous opportunity in the country with penetration level of less than 30%. CIL is adopting advanced technology across all product categories. The company is leveraging on its parent’s global technology to develop new products with local consumer insights. Continuous product innovation, speed to market, driving cost out of supply chain and e-commerce will help the company in delivering enhanced shareholder value. These efforts would also go a long way in re-building the company.

    Colgate India currently, quotes at P/E of 43 times its FY01 projected earnings with a market cap to sales ratio of 2 times. Worldwide the parent, Colgate, gets a P/E of 35 on a market cap to sales ratio of 4 times. Investors’ perception about the stock is likely to change gradually with the company’s improved financial performance and its implementation of aggressive strategies.

     

     

    Equitymaster requests your view! Post a comment on "Global brands from Colgate". Click here!

      
     

    More Views on News

    Colgate: Competition Impacts Volume Growth (Quarterly Results Update - Detailed)

    Nov 25, 2016

    Colgate-Palmolive (India) has announced the second quarter results financial year 2016-2017 (2QFY17). While the topline increased by 9.5% YoY, the bottomline has increased by 15.6% YoY.

    Colgate: Margins come under pressure (Quarterly Results Update - Detailed)

    Oct 4, 2016

    Colgate-Palmolive (India) has announced the first quarter results financial year 2016-2017 (1QFY17). While the topline increased by 12.4% YoY, the bottomline has increased by 8.4% YoY.

    Marico: Earnings Hit by Lower Volumes and Firming Input Prices (Quarterly Results Update - Detailed)

    Aug 9, 2017

    While GST implementation brought down volumes and profitability in the short run, Marico remains optimistic in the long run.

    Colgate: Excise Benefit Phase-off Mars FY16 Results (Quarterly Results Update - Detailed)

    Jun 2, 2016

    Colgate-Palmolive (India) declared results for the quarter and year ended March 2016. The company's revenues were up by 7% YoY, while profits declined by 11% YoY during the quarter.

    Colgate: Lower A&P Costs Prop Up Margins (Quarterly Results Update - Detailed)

    Feb 3, 2016

    Colgate-Palmolive (India) announced its results for the quarter ended December 2015. The company's revenues were up by 2% YoY, while profits rose by 22% YoY.

    More Views on News

    Most Popular

    A 'Backdoor' to Multibaggers: It's Like Investing in Asian Paints Ten Years Ago(The 5 Minute Wrapup)

    Aug 10, 2017

    Don't miss these proxy bets on growing companies or in a few years you will be looking back with regret.

    The Most Important Innovation in Finance Since Gold Coins(Vivek Kaul's Diary)

    Aug 10, 2017

    Bill connects the dots...between money and growth, real money and real resources, gold and cryptocurrencies...and between gold, cryptocurrencies, and time.

    Signs of Life in the India VIX(Daily Profit Hunter)

    Aug 12, 2017

    The India VIX is up 36% in the last week. Fear has gone up but is still low by historical standards.

    Bitcoin Continues Stellar Rise(Chart Of The Day)

    Aug 10, 2017

    Bitcoin hits an all-time high, is there more upside left?

    5 Steps To Become Financially Independent(Outside View)

    Aug 16, 2017

    Ensure your financial Independence, and pledge to start the journey towards financial freedom today!

    More
    Copyright © Equitymaster Agora Research Private Limited. All rights reserved.
    Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement.

    LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.

    SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.

    Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
    Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: info@equitymaster.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407
     

    Become A Smarter Investor In
    Just 5 Minutes

    Multibagger Stocks Guide 2017
    Get our special report, Multibagger Stocks Guide (2017 Edition) Now!
    We will never sell or rent your email id.
    Please read our Terms

    COLGATE SHARE PRICE


    Aug 22, 2017 01:26 PM

    TRACK COLGATE

    • Track your investment in COLGATE with Equitymaster's Portfolio Tracker. Set live price alerts, get research alerts and more. Get access now...
    • Add To MyStocks

    COLGATE 8-QTR ANALYSIS

    Detailed Quarterly Results With Charts

    COMPARE COLGATE WITH

    MARKET STATS