Dolat Capital: Colgate Palmolive’s Toothpaste Gains Traction In Q1; But Rich Valuations Is A Key Concern
An employee arranges Colgate-Palmolive Co. Colgate brand toothpaste at a Big Bazaar hypermarket. (Photographer: Dhiraj Singh/Bloomberg)

Dolat Capital: Colgate Palmolive’s Toothpaste Gains Traction In Q1; But Rich Valuations Is A Key Concern

BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.

Dolat Capital Report

Colgate Palmolive India Ltd.’s Q1 FY21 results were ahead of our expectation on all parameters. The company posted 7% volume de-growth during Q1.

While toothpaste reported mere 3% volume de-growth, a higher decline in toothbrush portfolio impacted overall volume performance.

Advertisement and promotion (A&P) spends reduced significantly, in line with lower spends of the peers. We believe that the A&P spends would remain low in the ensuing quarters due to consumer upstocking.

Going ahead, government efforts to increase farmer’s wages and focus on rural infrastructure should boost oral care category. However, increase in competition and better product offerings by competitors like Dabur India Ltd. remains a key challenge for Colgate.

Click on the attachment to read the full report:

Dolat Capital Colgate Palmolive Q1FY21 Result Update.pdf

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