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Dabur: Premiumisation Efforts to Keep Competition at Bay? - Views on News from Equitymaster
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  • May 4, 2016 - Dabur: Premiumisation Efforts to Keep Competition at Bay?

Dabur: Premiumisation Efforts to Keep Competition at Bay?
May 4, 2016

Dabur India declared results for the quarter and year ended March 2016. During the year, the company's revenue rose by 8% YoY, while profits moved up by 18% YoY. Here is our analysis of the results.

Performance summary
  • Net sales up by 8% YoY during FY16; growth led by the company's food and consumer care businesses.
  • Lower input costs lead to margin expansion of 1.2% YoY to 18% during the year.
  • Profits rise by 18% YoY.
  • Board declares final dividend of Re 1 per share; total dividend per share for FY16 stands at Rs 2.25 per share (yield of about 0.9%).

    Consolidated Financial Performance
    (Rs m) 4QFY15 4QFY16 Change FY15 FY16 Change
    Net sales 19,497 21,613 10.9% 78,272 84,540 8.0%
    Expenditure 16,041 17,460 8.8% 65,108 69,342 6.5%
    Operating profit (EBDITA) 3,457 4,154 20.2% 13,164 15,198 15.4%
    EBDITA margin (%) 17.7% 19.2% 16.8% 18.0%
    Depreciation 282 360 27.6% 1,150 1,338 16.3%
    EBIT 3,175 3,794 19.5% 12,014 13,860 15.4%
    EBIT margin (%) 16.3% 17.6% 15.3% 16.4%
    Interest 103 131 27.0% 401 480 19.7%
    Other income 447 563 26.0% 1,581 2,192 38.7%
    Exceptional items 0 0 0 0
    Profit before tax 3,519 4,226 20.1% 13,194 15,572 18.0%
    Tax 670 892 33.2% 2,509 3,018 20.3%
    Effective tax rate 19.0% 21.1% 19.0% 19.4%
    Profit after tax/(loss) 2,849 3,334 17.0% 10,685 12,555 17.5%
    Minority interest/ Share of associate company -1 -15 -26 -27
    Net profit after tax 2,848 3,319 16.6% 10,658 12,527 17.5%
    Net profit margin (%) 14.6% 15.4% 13.6% 14.8%
    No. of shares (m) 1,759.1
    Diluted earnings per share (Rs)* 6.1
    Price to earnings ratio (x) 46.4

    (*On a trailing 12-month basis)
    Source: Company, Equitymaster research

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