Morgan Stanley on Dabur:
Morgan Stanley maintains an “Equal-Weight” rating on Dabur with a target price of Rs 772.
In the second quarter, sales fell by mid-single digits, contrary to management’s expectations for improved growth.
This decline was due to a correction in distribution inventory within the General Trade channel.
Heavy rains and floods affected home consumption and consumer spending.
The beverages segment also experienced negative impacts.
EBITDA for Q2 is expected to decline by mid to high teens due to operating leverage issues.
Investec on Dabur:
Investec maintains a “Hold” rating on Dabur with a target price of Rs 368.
The company faced its weakest quarter in four years.
Investec expects a 5% decline in consolidated revenue for Q2.
They predict a 10% decline in volumes in India.
The trading update has been much more negative than expected.
EBITDA for Q2 is forecasted to decline by 15%, along with a 17% decrease in profit after tax (PAT).
