Fundamental Analysis of Godrej Consumer Share

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Let’s step into the fascinating story of Godrej Consumer Share, a name that’s not just a company but a part of India’s journey. It all started with Ardeshir Godrej, lawyer turned entrepreneur who faced failures before hitting success with locks. Now, Godrej consumer products touch the lives of 1.1 billion people globally in consumer goods, real estate, appliances and more.

Back in 1920, Godrej made mark by making soap by using vegetable oil instead of animal fat. This humane approach laid the foundation for the Home & Personal Care chapter, making Godrej a top FMCG company in India.

But it doesn’t stop there, Godrej’s impact reaches international shores with almost half its FMCG earnings from Asia, Africa and Latin America. From insecticides to hair care and soaps, Godrej is a leader known for its commitment to people and the planet.

Today, Godrej is not just a brand. It’s like a story that’s a part of the everyday lives of 1.15 billion people worldwide.

Godrej Consumer Products (GCPL) is a business that’s all about making our daily lives better in three key areas: Home care, personal care and hair care.

In the category of Home care, GCPL stands out as a leader with products like Goodknight and HIT making sure our homes are not just safe but comfortable too.

When it comes to personal care, GCPL has us covered with brands like Godrej No.1 and Cinthol, offering quality soaps that have become a part of our daily routine.

And in hair care, GCPL understands the diverse needs from the iconic Darling brand for women of African descent to being the top player in hair color with Godrej Expert and others.

GCPL’s business is not just about products it’s about enhancing our everyday experiences, whether it’s at home, taking care of ourselves or tending to our hair.

Godrej Consumer Share Returns

Before moving forward, let’s look into the return over the past few years where Godrej Consumer Products’ share has shown varying percentages of return to its shareholders.

In the last year, there was 18% increase in returns, indicating positive performance. Over two years the growth was 14% suggesting steady but slightly lower returns than the previous year. However, over three years stock of Godrej consumers recorded a 47% increase.

For those who held onto their investments for five years there was a 37% growth further underlining the company’s overall positive performance over a more extended period.

Godrej Consumer Products Stock Key Financial Metrics

Company Essentials	Value
Market Cap	₹ 1,06,552.31 Cr.
Face Value	₹ 1
Current Price	₹ 1,041.75
52 Week High	₹ 1,102.05
52 Week Low	₹ 861.45
Industry P/E	61.19
Stock P/E	60.89
P/B	10.37
Div. Yield	0%
Debt	₹ 23.82 Cr.
EPS (TTM)	₹ 17.02

Godrej Consumer stock Cash Flow (value in Cr.)

The table below presents Godrej Consumer Products varying cash flows over the years with positive net cash flow in 2022 but a negative trend in 2023 possibly due to increased investments and financing activities. Let’s deep dive into for better understanding:

The cash generated from operating activities, representing the core business, steadily increased from ₹1,588 crore in March 2020 to ₹2,150 crore in March 2023.
However, investing activities, including investments and asset purchases, exhibited a varying pattern with cash outflows of ₹533 crore in March 2020, decreasing to ₹1,758 crore in March 2023.
Financing activities, like borrowing and paying back debts, decreased from ₹1,295 crore in March 2020 to ₹794 crore in March 2023.
Despite a positive net cash flow of ₹226 crore in March 2022, indicating overall positive cash movement, the trend reversed in March 2023 with a negative net cash flow of ₹398 crore.

Particulars (Standalone)	Mar 2020 (Cr.)	Mar 2021 (Cr.)	Mar 2022 (Cr.)	Mar 2023 (Cr.)
Cash from Operating Activity	1,588	2,029	1,450	2,150
Cash from Investing Activity	-533	-315	-864	-1,758
Cash from Financing Activity	-1,295	-1,816	-379	-794
Net Cash Flow	-255	-77	226	-398

Annual Financial Overview of Godrej Consumer Stock

Sales Growth: Over the past four years, Godrej Consumer Products has experienced a varying trend in sales growth. In March 2020 there was a slight decline of 3.9% in sales compared to the previous year. However the company rebounded strongly in the subsequent years by achieving sales growth of 11.3% in both March 2021 and March 2022. In the most recent data for March 2023 there was still positive growth, though at slightly lower rate of 8.5%.

Overall, the sales have been on an upward trajectory, indicating positive performance and expansion for Godrej Consumer Products over this period.

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Operating Profit Growth: The company has experienced an increase in its operating profit. In March 2020 operating profit was 2,154 crores which has shown a positive growth trend. By March 2023 operating profit had reached 2,443 crores. Growth percentages indicate fluctuations with a notable spike of 11.4% in March 2021. Overall, the company’s operating profit has gradually and positively developed, demonstrating financial stability and growth.

Net Profit Growth: The chart below showing fluctuation in net profit growth over the past 4 years. In March 2020 there was decline of 36.1% compared to the previous year. However, the company rebounded in March 2021 with a positive growth of 15.0%. Growth continued in March 2022 but unfortunately in March 2023, there was a slight dip in net profit compared to the previous year.

Overall, there have been ups and downs in Godrej Consumer Products’ net profit with the most recent year showing a small decrease.

Key Financial Metrics of Godrej Consumer Share Price

ROE Ratio:

ROE Ratio or Return on Equity, is like a report card for a company. It tells us how well the company uses the money its shareholders invested. A higher ROE means the company is good at turning shareholders’ money into profits.

ROCE Ratio:

ROCE Ratio which stands for Return on Capital Employed is a financial measure that tells us how well a company uses its money to make more money. If a company has a high ROCE it means it’s doing an excellent job of using its money to make profits. But if the ROCE is low, it could mean the company isn’t using its money very efficiently.

Godrej Consumer Product’s Shareholding Pattern

Let’s look into the ownership of Godrej Consumer Products as of September 2023 which is divided among different groups.

Majority about 63.21% is held by promoters which likely include the founders or key individuals associated with the company.

Public which includes individual investors like you and me holds a smaller portion at 5.62%. Domestic Institutional Investors (DIIs) such as mutual funds or insurance companies own about 7.65%.

Foreign Institutional Investors (FIIs) representing foreign entities investing in the company hold the largest portion among non promoter entities at 23.51%.

Promoter Pledging (%): 0.66

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Final Words

As we discussed the story and numbers behind Godrej Consumer share, it’s evident that this company goes beyond being just a business, it’s a part of our daily lives.

From its strong financial performance to its diverse product offerings, Godrej has shaped its own narrative and become an integral part of daily life for more than a billion people across the globe. The journey of this company with its roots in innovation and a commitment to positive experiences, prompts us to reflect on the everyday products we often take for granted. So, the next time whenever you reach for that familiar soap or home care item, remember that it might be more than just a product it’s connected to a story that continues to unfold.

What are your thoughts on relationship between everyday products and companies that produce them?

Happy investing and thank you for reading!

Disclaimer:
This website content is only for educational purposes, not investment advice. Before making any investment, it’s important to do your own research and be fully informed. Investing in the stock market includes risks, and you should carefully read the Risk Disclosure documents before proceeding. Please remember that past performance doesn’t guarantee future results, and due to market fluctuations, your investment goals may not always be achieved.

Fundamental Analysis of Godrej Consumer Share