The beauty and wellness segment is on a positive growth path riding on the back of fast-changing lifestyles, growing health consciousness, high disposable incomes and demand for quality products. The burgeoning urban population and rise in spending by rural India on personal care products augurs well for the consumer industry as a whole and the aforementioned segment in particular.
Kaya Skin Clinic, the skincare solutions business, is also expected to witness high growth post consolidation in FY07. Increasing contribution from international markets and potential acquisitions should also help the company maintain consistent growth.
Expect business revenues to grow at a CAGR of 23% over FY07-09. The PAT is expected to grow to Rs.2.25 bn at a CAGR of 41% over FY07-09E. Valuing Marico’s current business on a DCF basis a fair price of Rs.90 per share is the target.