JPMorgan has maintained its Neutral rating on Colgate-Palmolive, while reducing the target price from Rs 3,450 to Rs 3,300. The revision comes after a margin miss in Q2, even though the company displayed resilience in volume growth, which remained at high single digits. The current market price (CMP) of Colgate-Palmolive is Rs 3,218.50.
Q2 performance
While volume growth was strong, the contraction in margins weighed on the overall Q2 performance. JPMorgan noted that the demand outlook has turned slightly cautious moving forward.
Margin outlook
Looking ahead, the brokerage expects margins to improve quarter-on-quarter in the upcoming period as advertising and promotional (A&P) spending phases out.
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