Emami Q4 Review - Sales In Line; Some Margin Pressure Emerging: Motilal Oswal
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Motilal Oswal Report
Emami Ltd.’s Q4 FY21 sales/volume growth of 37%/39% was broadly in line with our estimate.
Albeit, aided by advance summer season sales in Q4 FY21, unlike the same quarter last year, two-year average growth has now been in the 7.5-10% range in the past three quarters, far better than the 3.7% compound annual growth rate growth in the five years ended FY20.
There was a significant miss of ~30% on the Ebitda front versus our expectation due to increasing material cost pressures and a sequential increase in ad spends as a proportion of sales.
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