- Sales growth is low. I wonder why established brands aren’t able to grow fast like new age brands like Mamaearth. You have an advantage of wide distribution network, something that D2C brands can’t get even after burning cash. You also have a trusted parent brand like Emami that can be leveraged to enter into more premium segments. India is in a hyper growth phase. With India moving from 3.75 trillion to 7trillion economy in the next few years there is no shortage of growth drivers in the premium segments.
- Continuous buyback is helping the return ratios, which is a good thing the company is doing. Company did a lot of open market buyback at low prices ~350-400 levels which is a really good value generator for existing shareholders
Valuations are low, so downside from here is limited. Any uptick in PAT, revenue, or any positive news can trigger mean-reversion to historical median valuations
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