PL First Cut - Emami 1QFY24

PL First Cut – Emami 1QFY24 – *Amnish Aggarwal – Head of Research - Prabhudas Lilladher Pvt Ltd*

Emami 1QFY24 – Revenues ahead while EBITDAM misses

(CMP: Rs462|Accumulate)

Financial performance

> Revenues grew by 6.8% YoY to Rs8.3bn (PLe: Rs8.0bn)

> Gross margins expanded by 241bps YoY/238bps QoQ to 65.4% (PLe: 64.0%)

> EBITDA grew by 9.6% YoY to Rs1.9bn (PLe: Rs1.9bn); Margins expanded by 60bps YoY but contracted 89bps QoQ to 23.0% (PLe:24.0%)

> Ad-spends were up 11% YoY

> Adj PAT grew by 86.5% YoY to Rs1.4bn (PLe: Rs 1.3bn)

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Revenues came ahead of our estimates, led by non-summer portfolio (16% YoY) as summer portfolio was impacted by unseasonal rains. Inflation continues to moderate for the company with sequential improvement in GMs. We estimate 1-2% volume growth (vs our estimate of -1.5%). Channels like Modern Trade/E-comm continue to perform well, growing by 45%/47% taking contribution to 9.7% of domestic sales. We have an ACCUMULATE rating on the stock with a target price of Rs 517.

Stock trades at 22.3x FY25 EPS