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Analysts Positive On Dabur, Buoyed By Growth In Rural Demand
The FMCG major believes increasing rural demand and the fiscal stimulus will drive growth.
23 Aug 2018, 03:48 PM IST
Dabur India Ltd.’s management is upbeat about the company’s growth as it listed at a recent analyst meeting increasing rural demand and the fiscal stimulus as driving factors.
Some of the strategies the company said it has adopted are:
- Accelerated pace of product launches.
- Intense direct distribution expansion.
- Increased targeted advertising spends based on localised marketing.
Shares of the fast-moving consumer goods major have risen 40.6 percent year-to-date compared with a 13.5 percent increase in the S&P BSE Sensex.
Here’s what analysts have to say about Dabur’s stock performance:
Deutsche Bank:
- Retain ‘Buy’, price target Rs 525—an upside potential of Rs 46.
- Company to gain from better execution, market-share gains and improving macro-economic environment
- Competitor Patanjali, earlier seen as disruptive, has only been a distraction.
- Company has made smart and practical launches in fruit drinks segment and FMCG products such as brahmi amla hair oil and red gel toothpaste.
- Company’s international business to accelerate (28 percent of revenues).
- Relative valuations attractive after underperformance over last few years.
Citi:
- Retain ‘Buy’, price target of Rs 495 an upside potential of Rs 10.
- Management confident of accelerated growth.
- Sharpening regionalised focus to improve consumer reach.
- Company is tailoring product mix specific to geographies.
- Company has identified 15 brands where it sees growth opportunities.
- Company is diving frontline sales teams for better portfolio selling.
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