Emami Limited is a fast moving consumer goods company in India which is known an extensive portfolio of personal and healthcare products.
The market cap of Emami Limited, as of June 7, 2018, is more than Rs.23,420 crore.
Company’s Wealth and Recent Performance
- For the Q4 FY 2018, Emami Limited reported its consolidated net profit to be at Rs.60.86 crore. This was in a stark contrast with the net profit of Rs.83.3 crore which was reported in the same quarter last year. This decline of 26.9% came after the company increased its spending on advertising. At the same time, it also had to write-off an alternate tax credit of Rs.14 crore.
- For the year ended on March 31, 2018, the net profit was reported to be at Rs.307.41 crore - a decrease of 9.7% from the previous year.
- Emami Limited’s revenue for the quarter was Rs.617 crore, which was 12% better than the same quarter previous year. The metric for the entire fiscal year was reported to be at Rs.2,540.83 crore, in contrast to Rs.2,527.74 crore in the previous year. The management expects a good growth in the consumer good business on the onset of a normal monsoon and the stabilisation of the goods and service tax regime.
- The board has also recommended the issue of bonus shares in the 1:1 ratio. The company will also pay a dividend of Rs.7 per share.
Emami Limited Stock Trends in 2018
- The Emami Limited stock price on January 2, 2018, was Rs.1,344.00 on the National Stock Exchange. Over the course of the month, the stock moved on to shed more than Rs.200. On January 31, the closing price was Rs.1,124. In February, owing to the turbulence in the international markets, the Indian stocks suffered heavily.
- As a result, Emami Limited stock price went down in the month. It entered the Rs.1,000 territory and stayed at those levels for the most of February. The bearish trend was seen in the month of March as well and the closing price at the end of the month was Rs.1,068.85 on the NSE. It is interesting to note that Emami Limited shares followed a similar trajectory to that of BSE SENSEX.
- In April, the prices rose slightly and crossed the Rs.1,100 mark. The jump was because of the bonus issue plan as decided by the management. However, towards the end of the month, the share price of Emami Limited plummeted again. Things did not change a lot in the month of May either. The shares ended the month at Rs.1,046 on NSE and Rs.1,047.45 BSE.
Emami Limited Stock Trends in 2016 and 2017
- At the start of 2016, Emami Limited stocks were trading at levels around Rs.985. The prices rose steadily over the course of the month to cross the Rs.1,000 mark by the end of January. This rally continued till mid-February post which, the stock price took a nosedive. For the most of March, the share price of Emami Limited exhibited a bearish behaviour. By March 31, the stocks had shed their previous gains to be traded at levels around Rs.930.
- At the start of April, the shares started exhibiting bullish trends. The prices rose remarkably through the month of April and most of May to cross the Rs.1,100 mark. After failing to find support at these levels, the prices collapsed to enter the Rs.1,000 territory again. It wasn’t until mid-June that the prices started to rise again and this time, the rally went on until November.
- The stock price of Emami Limited moved on to rise in June and July on the anticipation of Q1 FY17 results. By early August, the share price had moved past the Rs.1,150 mark. However, the prices were still a bit volatile and the ups and downs were seen throughout August. A similar trend was seen in the month of September as well and the closing price on September 30, 2016, was Rs.1,169.90 on NSE.
- The Emami Limited stocks in October were in a state of unpredictability. Towards the end of the month, the prices spiked on the back of a strong performance in the second quarter. As a result, the share price crossed the Rs.1,200 mark for the first time since August 2015. However, this rally didn’t last for long. The Emami Limited share price suffered heavily post-demonetisation. It led to a bear run that went on until the end of the year. The closing price on December 30, 2016, was Rs.951.55 on NSE.
- The start of 2017 brought some good news for the investors. The share price rose in January to cross the Rs.1,000 mark again but post mid-Jan, they fell again. This was followed by another bull run which was seen for the most of February. During this time, the shares were trading at around Rs.1,150. However, the stocks suffered heavily thereafter went on to lose over the course of March and April. The closing price on April 28, 2017, was Rs.1058.25.
- This abrupt trend of rise and fall in prices was seen in the months of May and June as well. The prices rose slightly in this period to cross the Rs.1,100 mark again. In the final week of June, the stocks, once again, starting exhibiting bearish signs and moved on to shed their previous gains.
- July was a dull month for the investors. A final dividend of 525% was announced towards the end of the month which helped the stock make some gains. The prices rose slightly in the first week of August but soon after touching the Rs.1,150 mark, the share price of Emami Limited went down again. The same was the case in September as well, when the stock price rose to enter the Rs.1,160 territory but ended up going down almost immediately thereafter.
- In the final quarter of the calendar year, the Emami Limited stock price moved on to find its 52 week high at Rs.1,365. This tremendous spike was driven by a strong performance in the Q2 FY18. While there were ups and downs in the prices, the shares maintained their bearings steadily at levels above Rs.1,200. The closing price at the end of the year was Rs.1,330.20.
Should you invest in Emami Limited stocks?
- The Emami Limited scrip, as of June 8, 2018, is trading at levels around Rs.1,073. Interestingly, at the start of the share, the same scrip was trading levels above Rs.1,300. One of the reasons for this fall can be attributed to the company’s disappointing performance in the fourth quarter.
- If we are to compare the performance of the stock over the course of last year, it is presently trading at levels similar to the ones it incurred in January 2017. The gains are marginal, although there are external market conditions which have led to the drop in the price.
- The company’s PE ratio is close to 79 which, in comparison to the industry’s PE, is considerably greater. This implies that the Emami Limited shares may be slightly overpriced, although Price-to-Earnings ratio shouldn’t be considered as the only factor to judge this stock.
- If you are looking for a scrip in the personal care sector, there are better options like HUL, Godrej Consumer, Dabur India, Colgate, and Marico. Their sales turnover and net profit are significantly higher than that of Emami Limited. You can also look at mutual funds holdings to diversify your portfolio. Whatever may be the case, it is strongly suggested that you do your own research before investing.
Emami Limited is a fast moving consumer goods brand that is known for its products in the personal and healthcare sector. Its flagship brands are BoroPlus, Fair and Handsome, Zandu Balm, Fast Relief, Kesh King and many others. The company’s portfolio comprises more than 300 products, all of which are based on ayurvedic formulations. Emami Limited is present in more than 60 countries and in the FY 2016-17, the group recorded a sales turnover of Rs.2,533 crore.
History of the Company
The foundation for the Emami Group was laid back in the mid-1970s when two childhood friends - R S Agarwal and R S Goenka, left their jobs as Chartered Accountants with the Birla Group to start their own ayurvedic medicine and cosmetic manufacturing unit in Kolkata. Considering that the FMCG industry was dominated by the MNCs back then, it was definitely considered to be a highly bold move. In their early days, the founders sold the products personally using hand-pulled rickshaws. As the demand for their products increased, they hired additional staff and began expanding their operations.
In 1978, the co-founders acquired Himani Limited - a group which was in financial trouble at the time but had a good brand equity in the region. This acquisition eventually paved way for the future success of the business. A few years, the company launched the BoroPlus antiseptic cream - its flagship product under the Himani Brand. In 1995, the company was converted into a Public Limited Company under the name Emami Limited and three years later, Himani Ltd was merged with the Emami Limited. The next decade saw the launch of new products in an attempt to diversify their product portfolio. The end result was the Emami Group becoming one of the most reputed names in the FMCG sector.
Management of the Company
Mr. R S Agarwal - Founder & Executive Chairman
Mr. Agarwal founded the company back in the 1970s with his childhood friend R S Goenka. Over the course of last three decades, he has played in instrumental part in making the Emami Group a worldwide brand. As a Chartered Accountant, LLB and a Master Degree holder in Commerce, his skills and academic knowledge have enabled him to steer the company efficiently during adverse conditions. He is a management guru who is known for his innovation and ability to capitalise on opportunities quickly.
Mr. R S Goenka - Founder & Wholetime Director
Mr. Goenka is an Indian entrepreneur who is best known for co-founding the Emami Group. As a Master of Commerce and Bachelor of Law, he is an expert when it comes to finance, corporate affairs, and strategic planning. He is also known for his keen attention to details and often rewards achievements, loyalty and commitment. He is also the 5th Indian to have received the prestigious Cavalier Cross of the Order of the Merit of the Republic of Poland in 2007.
N H Bhansali - CEO of Finance & Business Development and CFO
Emami Limited Listings in NSE, BSE, and Indices
The shares of Emami Limited in the dematerialised form are available for trading on the following stock exchanges: The National Stock Exchange of India Limited, Bombay Stock Exchange Limited, and the Calcutta Stock Exchange. The respective codes for the same are as follows:
- BSE Code: 531162
- NSE Code: EMAMILTD
- ISIN Code: INE548C01032
- Sector: Personal Care
Coming to the stock market indices, Emami Limited comprises the following:
- NIFTY 100
- S&P BSE 500
- S&P BSE 200
- S&P BSE MidCap
- NIFTY Next 50
- NIFTY FMCG
687 Anandapur, EM Bypass
Kolkata - 700107
West Bengal, India
Phone number: +91-33-66136264
Email ID: email@example.com
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