Financial Daily from THE HINDU group of publications
Sunday, Oct 03, 2004
Financial Daily from THE HINDU group of publications Sunday, Oct 03, 2004 |
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Investment World
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Stocks Markets - Recommendation Marico: Long-term buy
INVESTORS with a long-term investment perspective can consider adding the Marico Industries stock to their portfolio. At a price of Rs 138, the stock trades at a price earnings multiple of about 14 times its per share earnings, on post-bonus equity. The stock trades at a discount to its fast-moving consumer goods (FMCG) peers, despite fairly bright growth prospects and a liberal policy in rewarding shareholders. A presence in the higher-growth segments of the FMCG business such as hair oil, steadily rising market shares and a significant pricing power within the categories in which it operates, set the company apart in a challenging environment for FMCG companies. Volume growth for Marico's brands has been in the healthy double-digit range over the past year, aided by a slew of brand extensions for its Parachute and Saffola ranges. The company also has a good success rate with new product launches. New businesses such as skin care (through the Kaya Skin Clinics), food supplements (through the Saffola meal and roti mixes) and high-end hair care products (Silk-n-Shine), hold a considerable promise for growth.
Aarati Krishnan
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