Dabur India shares slip post-Q1 update; Morgan Stanley remains overweight

Dabur India share price NSE, Dabur India Q1 update: Dabur India shares on Friday slipped as much as 3.7 per cent to touch the day's low of Rs 570.65 from the previous close of Rs 591.95 on the NSE, despite the homegrown FMCG firm reporting that the trends in both urban and rural India have shown signs of improvement in the quarter ended on June 30, 2023. The counter finished at Rs 571.8, down by Rs 20.15 or 3.4 per cent on the NSE.

In its quarterly update, Dabur India said it expects the improvement in gross margins to continue in the ongoing fiscal year, encouraged by the moderation in inflation and growth trends in urban and rural India. "One of the key contributing factors to this positive development has been the reduction in inflation. Sequential moderation in inflation has positively impacted consumer spending power and is resulting in gradual improvement in offtakes in the industry," it said.

The company added, "The reduction in inflation is expected to lead to year-on-year gross margin expansion. We are channelising a major part of the gross margin expansion towards ramping up advertising and promotion (A&P) spending to ensure long-term success. Consequently, operating profit should grow in line with revenue growth." Dabur further said that its consolidated business, including the recently acquired Badshah Masala, is expected to register growth exceeding 10 per cent.

The company said, "We are encouraged by the improving trends observed in the urban and rural markets in India, as well as the positive performance of our business segments. We remain committed to driving growth and profitability while navigating market challenges and capitalising on opportunities for the remainder of the fiscal year." Read more

Dabur India share price target: Should you buy, sell, or hold?

• Morgan Stanley has maintained an overweight rating on Dabur India with a target price of Rs 606.
• JP Morgan has maintained a neutral call with a target price of Rs 570.
• Nomura has maintained a buy call with a target price of Rs. 640.
• Macquarie has maintained a neutral call with a target price of Rs 570.
• Goldman Sachs has maintained a buy call with a target price of Rs 600.

Dabur India's share price history

Dabur India's stock has given a positive return of over 7 per cent in the last 12 months (since July 7, 2022). In comparison, the headline index, Nifty 50, has rallied nearly 20 per cent.

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