Dabur India, the ayurvedic products major, has reported an encouraging 7% topline growth in June quarter. It ability to control costs led to a 100 basis point expansion in operating margins, thus helping the company report an over 30% growth in 1QFY03.
Operating Profit (EBDIT)
Operating Profit Margin (%)
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Effective tax rate (%)
No. of Shares (eoy) (m)
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The company's interest and depreciation heads remained more or less steady at last year's levels. However, deferred taxes led to higher tax provisioning. Profit before tax growth stood at nearly 41% during the quarter.
Finished goods purchased
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Though Dabur's raw matrial costs declined nearly 11%, its purchases of finished goods went up by nearly 10% YoY. This reflects the increasing trend of outsourcing adopted by the company. A lot of FMCG companies outsource production finding them more cost efficient as compared to own plant manufacture.
The stock trades at Rs 47, a P/E of 29x annualised 1QFY03 earnings. Though the company's June quarter performance is encouraging, Dabur has a knack of inconsistent performances. The valuations anyway seem to have factored in a decent growth during FY03.
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