FMCG stock is in the spotlight after announcing a Rs.1,400 crore investment to enter the pet-care market and to set up new manufacturing plants.
Share Price Variation
In Thursday’s trading session, the share price of Godrej Consumer Products Ltd (GCPL) reached an intra-day high of Rs.1,509.85 per share from its previous closing price of Rs.1,501.1 apiece, marking a 1 percent gain.
What is the news
The stock’s uptick follows GCPL’s announcement of a Rs.1,400 crore investment plan. This includes Rs.500 crore allocated to its new pet-care division, Godrej Pet Care (GPC), a wholly-owned subsidiary. The pet-care venture, with manufacturing and R&D support from Godrej Agrovet Ltd (GAVL), is expected to launch in the second half of FY26.
Additionally, GCPL announced a Rs.900 crore capital expenditure for setting up new manufacturing units in Tamil Nadu and Madhya Pradesh. These projects, set to start within 18-36 months, and will be funded through a mix of internal accruals and debt, aiming to enhance the company’s production capacity.
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Management Commentary
Sudhir Sitapati, MD and CEO of GCPL, highlighted that pet ownership in India is low, with only 10 percent of pet owners using packaged food. China, by contrast, has 20 percent pet ownership and a 25 percent calorie conversion rate.
GCPL’s strong position, supported by its group company GAVL’s expertise in animal feed, offers a significant advantage to enter into Pet-care business. The company will invest Rs.500 crore in its pet-care subsidiary, GPC, over five years, aiming for positive cash flow and starting manufacturing in the second half of next year.
Financials
Godrej Consumer Products Ltd recently published its quarterly results for Q1 FY25. With a market capitalization of Rs.1.48 lakh crores, the company reported standalone revenue of Rs.2,163 crores, marking an 8 percent increase from Rs.2,005 crores in Q1 FY24 and a 6.4 percent rise from Rs.2,034 crores in Q4 FY24.
Despite this revenue growth, Profit After Tax (PAT) declined to Rs.368 crores from Rs.390 crores in Q1 FY24 but improved significantly from a net loss of Rs.701 crores in Q4 FY24.
Company Overview
Godrej Consumer Products Limited is a Mumbai-based multinational consumer goods company from India. It offers a variety of products, including soaps, hair colourants, toiletries, and liquid detergents. Notable brands include Cinthol, Godrej Fair Glow, Godrej No.1, Godrej Shikakai, Godrej Powder Hair Dye, Renew, ColourSoft, and Ezee.
Written by – Siddesh S Raskar
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