Colgate-Palmolive (India) Ltd, or CPIL, is a 51% subsidiary of Colgate-Palmolive Company, USA. It is the market leader in Indian oral care market. In FY15, it commanded 57.8% & 42.1% volume market share in toothpaste & toothbrush category respectively. CPIL has maintained its position as the undisputed leader for more than a decade.
Valuation and View
CPIL is better placed than peers given its strong parentage, pricing power, leadership position and distribution reach in the oral care market. We expect revenue and PAT to grow at a CAGR of 9.6% and 11.4% over FY15-FY18E. Further, we rate the stock as ‘BUY’ assigning a forward P/E of 33x arriving at a target price of Rs. 937 which implies potential upside of ~10% for next 12 months.
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