Shares of Gillette India gained 4.16 per cent to Rs 5,752.60 on the BSE on Thursday after the company announced results for the quarter ended June 30, 2020. The company's net profit dipped 1.85 per cent year-on-year (YoY) to Rs 44.97 crore, owing to "a one-time hurt in the corresponding quarter of the previous year".
The company, which follows July-June financial year, reported total income of Rs 352.74 crore for the quarter, down 24.36 per cent from 466.39 crore in the year-ago quarter.
However, the company said its sales had seen a sharp recovery in June and July to pre-Covid levels.
"In April-May, our sales were significantly impacted due to the coronavirus pandemic-related lockdown, which reduced the shaving frequency among consumers." Gillette India Managing Director Madhusudan Gopalan said.
"With the easing of the lockdown, the company saw a sharp recovery in June and July to pre-COVID-19 levels. While the unprecedented market challenges and uncertainties remain in the near term, we will continue to stay focused on our strategy to drive superiority and improve productivity, and aim to drive balanced growth," it said.
The company's board of directors has recommended a dividend of Rs 49 per equity share for the financial year ended June 30, 2020
At 10:50 AM, the stock was trading 2.72 per cent higher at Rs 5673 as compared to 0.4 per cent gain in the benchmark S&P BSE Sensex. Around 33,000 shares have changed hands on the NSE and BSE, combined, so far.
Nirmal Bang Institutional Equities, which has 'ACCUMULATE' rating on the stock raised its target price to Rs 5,770 from Rs 4,870 earlier.
"With a sharp recovery seen in June/July to pre-COVID levels following the easing of the lockdown, we believe sales will pick up going forward, led by pent-up demand in the Grooming business. We revise our earnings estimates upwards for FY21E/FY22E EPS by 8.9%/7.2%. Although market growth has been somewhat lower than expectation in the Grooming category, the company with its wide portfolio, innovation capability and strong market execution capability should improve its share," the brokerage said.