8 November 2021
Update | Sector: Consumer
P&G Hygiene and
Healthcare
BSE SENSEX
60,546
S&P CNX
18,069
CMP: INR14,371
TP: INR17,450 (+21%)
Strong broad-based topline growth; ad spends to
stabilize at lower levels
Buy
Stock Info
Bloomberg
Equity Shares (m)
M.Cap.(INRb)/(USDb)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
12M Avg Val (INR M)
PG IN
32
466.5 / 6.3
15147 / 9881
4/-16/-4
129
Financials Snapshot (INR b)
Y/E March
2021 2022E
Sales
35.7 39.2
Sales Gr. (%)
19.1
9.6
EBITDA
7.0 10.0
Margins (%)
19.5 25.7
Adj. PAT
5.1
7.4
Adj. EPS (INR)
156.1 228.4
EPS Gr. (%)
13.4 46.3
BV/Sh.(INR)
220.0 242.9
Ratios
RoE (%)
54.1 98.7
RoCE (%)
60.1 104.6
Valuations
P/E (x)
92.6 63.3
P/BV (x)
65.7 59.5
EV/EBITDA (x)
66.3 46.1
Div. Yield (%)
2.2
1.4
2023E
46.3
18.2
12.6
27.1
9.4
288.4
26.3
271.7
112.1
118.8
50.1
53.2
36.7
1.8
Shareholding pattern (%)
As On
Sep-21 Jun-21 Sep-20
Promoter
70.6
70.6
70.6
DII
13.5
13.6
13.5
FII
2.6
2.5
2.5
Others
13.3
13.3
13.4
FII Includes depository receipts
Here are the key takeaways from P&G Hygiene and Healthcare (PGHH)’s FY21
Annual Report:
Feminine Hygiene and Healthcare segments report strong growth:
PGHH
continued to strengthen its brand fundamentals with innovation, product
launches, distribution expansion, and superior communication and execution.
Sales grew 19.1% YoY in FY21, led by the Feminine Hygiene (66% of sales; up
16.7% YoY) and Healthcare (33.1% of sales; up 24.1% YoY) segments. The
company does not share segmental data as a part of its quarterly results.
Ramping up category development:
Since 1995, the Whisper school program
has educated more than 25m girls across India on menstrual hygiene. PGHH
supported 40,000 schools, educating ~6m adolescent girls on the importance
of menstrual hygiene in FY21 – despite the pandemic – via digital means. It
plans to reach over 8m girls annually within the next three years. The
company is committed to doubling the program’s impact by covering 50m girls
within the next few years. This initiative is an important part of category
development by PGHH, the category leader in the Feminine Hygiene segment,
which has penetration levels of just ~20% in India.
Vicks continues to gain market share in each of its sub-segments:
PGHH
continued to gain share in the Cough & Cold category, with strong offtake
growth across sub-brands in the portfolio – VapoRub and BabyRub (61% of
healthcare sales), cough drops (32%), and tablets (7%). Growth was driven by
a) a superior go-to-market strategy, with an enhanced presence in stores with
more visibility touchpoints per store, b) increased market share in the Cough
& Cold category, and c) innovation backed by strong communication
campaigns.
Gross margin increases sharply:
Some years ago, PGHH outsourced the
manufacturing of its Vicks products to P&G’s other entities. This has led to
lower material costs, but subsequently higher processing charges. We believe
this is a key factor that has largely contributed to the reduction in RM costs
(32.4% of sales in FY21 from 36.9%/42% in FY20/FY19) for the company in
recent years.
Investments in higher ad spend in line with P&G’s global strategy:
The
company’s aggression in branding since FY18 was ramped up further in FY21.
The company increased ad spending in FY18 and FY19 (10.6% of sales for both
years). This continued in FY20 (10.9% of sales) and increased even further to
14.6% of sales in FY21, in line with P&G’s global strategy to boost ad spends
during the pandemic. We believe ad spends are likely to normalize at 11–12%
of sales in subsequent years.
Krishnan Sambamoorthy – Research analyst
(Krishnan.Sambamoorthy@MotilalOswal.com)
Research analyst: Dhairya Dhruv
(Dhairya.Dhruv@motilaloswal.com) /
Kaiwan Jal Olia
(kaiwan.o@motilaloswal.com)
Investors are advised to refer through important disclosures made at the last page of the Research Report.
Motilal Oswal research is available on www.motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.
 Motilal Oswal Financial Services
P&G Hygiene and Healthcare
Sustainability efforts:
On the sustainability front, PGHH is working towards
reducing greenhouse emissions at its manufacturing sites. It aims to achieve half
of 2010 levels by 2030, in line with P&G’s global directive for the group. It has
also initiated efforts to reduce the flow of plastic by recovering and recycling
multi-layered plastic packaging waste.
Dividend:
In FY21, the Board of Directors declared an interim special dividend of
INR150 per share, in addition to the interim/final dividends of INR85/INR80 per
share. The dividend payout was over 200% in FY21. We believe intermittent
special dividends in subsequent years will be an ongoing feature of the company
– as it does not need the cash balance for expansion, and these payouts would
only serve to improve RoCE and RoE.
AGM:
The 57th Annual General Meeting of the company is to be held on
Wednesday, 17
th
Nov’21 at 11:00 am through video conferencing.
Valuation and view
PGHH delivered strong sales growth in the first half of the decade, with a 20.4%
CAGR over FY10–15. The company saw a lull period over the next three years
due to overhauls such as demonetization and the introduction of GST. However,
since FY19, growth seems to have returned strongly (barring a temporary blip in
FY20 due to COVID-related disruptions). With 19% sales growth delivered in
FY21, PGHH appears to have returned to the growth levels seen in the earlier
half of the decade.
Efforts in distribution expansion, significantly higher ad spends, new launches,
and price cuts have boosted PGHH’s growth in recent years. Although expensive
valuations of 50.1x FY23E EPS imply a limited near-term upside, two factors
make PGHH an attractive long-term core holding: (1) the potential for huge
category and market share growth in the Feminine Hygiene segment (66% of
FY21 sales) owing to considerable moats and (2) potentially huge margin gains
from premiumization in Feminine Hygiene over the longer term.
The company should see rapid growth over the long term on the back of certain
encouraging developments: (a) the increasing pace of distribution expansion, (b)
the continuingly strong pace of category development efforts in schools to
boost awareness and growth, (c) rising ad spends after a lull in preceding years,
(d) a healthy pipeline of new products, (e) accelerated consumer entries into the
category through launches at low price points, and (f) the willingness to take
price cuts, whenever required, to boost growth. We maintain a
Buy
rating, with
TP of INR17,450 (50x Dec’23 EPS).
8 November 2021
2
 Motilal Oswal Financial Services
P&G Hygiene and Healthcare
New launches in FY21
In FY21, PGHH continued to focus on driving meaningful innovations for
consumers, backed by distribution expansion and strong advertising.
PGHH launched the Vicks Roll-On Inhaler.
The newly launched Old Spice 0% gas deodorants are strengthening its foothold
in the category.
Exhibit 2: Old Spice 0% gas deodorants
Exhibit 1: Newly launched Vicks Roll-On Inhaler
Source: Company, MOFSL
Source: Company, MOFSL
Feminine Hygiene business (66% of FY21 sales)
In the Feminine Care business, Whisper remained the market leader.
There was strong innovation across the portfolio. PGHH strengthened its
position in the emerging premium Nights segment, while playing actively in the
base Ultra and Choice portfolios.
Segmental sales grew 16.7% YoY – this is the second year in the past three years
that it has achieved sales growth in excess of 15% in this segment, following
24.5% growth in FY19.
In FY21, PGHH ran the second version of the Whisper #KeepGirlsInSchool
campaign to raise awareness about the issue of girls dropping out of school on
reaching puberty.
It also partnered with a major media house on the ‘Period Of Pride Partnership’
campaign.
Whisper advocated for the integration of a period module in the school
curriculum to sensitize both boys and girls to the concept of menstruation
and menstrual health. It believes educating both the sexes on menstruation
could help bring a revolutionary change in how people perceive
menstruation.
About 1m people signed Whisper’s petition to integrate the period and
puberty education module in the school curriculum, currently being
developed in partnership with UNESCO.
8 November 2021
3
 Motilal Oswal Financial Services
P&G Hygiene and Healthcare
P&G plans to launch its global sanitary napkin recycling program in India. We
note, however, that this has been in the planning stage for a few years now and
seems to have been delayed, perhaps more recently due to the pandemic.
Whisper school program
PGHH supported 40,000 schools, educating ~6m adolescent girls on the
importance of menstrual hygiene in FY21 – despite the pandemic – via digital
means.
The scope of this program is being extended; Whisper announced its
commitment to educate over 25m adolescent girls on puberty and hygiene over
the next three years. These are welcome category development efforts by
PGHH, the leader in the category.
P&G’s signature CSR program in India, P&G Shiksha, conducted through P&G
entities, focuses on three main areas – a) improving education infrastructure, b)
empowering marginalized girls through education, and c) improving learning
outcomes. To date, the P&G group in India has supported over 2,500 schools
(+200 since last year) across the country, impacting the lives of over 2.3m
children (+300,000 since last year).
Exhibit 3: Feminine Hygiene sees 16.7% growth in FY21, its second strong performance in
three years
Feminine Hygiene sales (INR b)
30.3
34.0
23.7
13.8
5.9
2.3
-0.7
16.5
FY18
20.5
FY19
-1.4
20.2
FY20
23.6
FY21
24.5
16.7
Growth (%)
8.1
FY12
10.9
FY13
13.5
FY14
15.3
FY15
16.2
FY16
16.6
FY17
Source: Company, MOFSL
Exhibit 4: Feminine Hygiene continues to form the bulk of overall sales
Feminine Hygiene sales (%)
2.1
28.8
1.2
30.1
0.8
32.0
Healthcare sales (%)
0.7
29.7
Old spice (%)
0.8
0.8
33.1
31.8
69.1
68.7
67.2
69.7
67.4
66.0
FY16
FY17
FY18
FY19
FY20
FY21
Source: Company, MOFSL
8 November 2021
4
 Motilal Oswal Financial Services
P&G Hygiene and Healthcare
Healthcare business (33.1% of sales in FY21)
The Healthcare segment grew 24.1% in FY21, the highest ever growth rate.
PGHH continued to gain share in the Cough & Cold category, with strong offtake
growth across sub-brands in the portfolio.
Growth was driven by a) a superior go-to-market strategy, with an enhanced
presence in stores, with more visibility touchpoints per store, b) increased
market share in the Cough & Cold category, and c) innovation backed by strong
communication campaigns.
Distribution expansion has been one of the key sales drivers in the Healthcare
segment in recent years, and the expansion seems to have continued unabated
in FY21. We gather that the company has reached around 3.5m outlets. Not only
is the reach significantly higher than a few years ago, but there is also massive
opportunity to grow the distribution reach of Vicks further, even simply within
the P&G universe. The unlisted company, P&G Home Products Pvt. Ltd., has
reached over 6m outlets; Vicks has the potential to reach a large portion of
these outlets given a) the problem-solving nature of the product, b) its
Ayurvedic efficiency, c) its low-cost SKUs, and d) the significant lesser shelf space
required for these products.
Exhibit 5: Vicks VapoRub (along with BabyRub) forms majority share of Healthcare
business, contributing to 60.9% of FY21 segmental sales
Ointments and Creams (%)
9.8
35.9
6.9
6.6
Cough Drops (%)
Tablets (%)
6.9
33.6
7.2
31.8
6.6
33.8
36.4
35.4
54.3
56.6
58.0
59.6
59.5
60.9
FY16
FY17
FY18
FY19
FY20
FY21
Source: Company, MOFSL
Exhibit 6: Healthcare segment up 24.1% YoY to INR11.8b in
FY21 – the highest ever segmental growth rate
Healthcare sales (INR b)
Growth (%)
24.1
18.1 17.3
10.9
16.8
7.5
-8.8
8.0
Exhibit 7: Ointments and creams continue positive
trajectory, with growth of 27.1% YoY in FY21
Ointments and Creams (INR b)
Growth (%)
25.5 25.6
10.6
27.1
20.0
12.2 10.6 14.3
-6.6
8.8
11.2
9.0
4.9
5.7
6.4
7.4
6.8
7.3
7.9
8.7
9.5
11.8
2.4
3.0
3.3
3.9
3.7
4.1
4.6
5.2
5.7
7.2
FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21
Source: Company, MOFSL
FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21
Source: Company, MOFSL
8 November 2021
5
 Motilal Oswal Financial Services
P&G Hygiene and Healthcare
Exhibit 8: Cough drops (32% of FY21 healthcare sales) see
strong growth of 17.6% YoY in FY21
Cough Drops (INR b)
Growth (%)
Exhibit 9: Tablets (7% of FY21 healthcare sales) see sharp
growth of 30% YoY in FY21
Tablets (INR b)
25.3
Growth (%)
30.0
11.3 14.2
0.4
-9.2
-20.0
-24.0
2.6
15.6 13.2 18.5
17.6
10.1
-8.7
9.0
5.0
4.6
6.0
8.5
1.8
2.0
2.4
2.7
2.4
2.6
2.8
3.0
3.2
3.8
0.7
0.7
0.7
0.8
0.7
0.5
0.5
0.6
0.7
0.9
FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21
Source: Company, MOFSL
FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21
Source: Company, MOFSL
Old Spice (0.8% of sales in FY21)
The aftershave lotion has posted double-digit growth.
Old Spice launched a deodorant with a 0% gas proposition in Feb’20, which is
strengthening its foothold in the category.
Overall pace of sales growth quickly rebounds in last two years
FY21 saw strong sales growth of 19.1% YoY after a tepid increase of 1.9% YoY in
FY20.
The weak base of the last year was attributable to the impact of COVID-19 and
its consequent lockdowns over the two quarters of Mar’20 and Jun’20 – PGHH is
a June year-ending company.
Sales were up 20% in FY19, led by 25% growth in Feminine Hygiene.
Growth in FY21 was broad-based, with Feminine Hygiene (66% of sales in FY21)
growing by 16.7% and the Healthcare segment (33.1% of FY21 sales) growing
even faster at 24.1%. This was on account of its increased distribution reach and
likely tailwinds due to the pandemic, leading to an increased focus on health
and well-being among consumers.
Exhibit 10: Overall sales up 19.1% YoY to INR35.7b in FY21
Sales (INR b)
29.3
30.0
21.6
13.8
-2.5
13.0
FY12
16.9
FY13
20.5
FY14
23.3
FY15
22.8
FY16
2.0
5.8
1.9
20.0
19.1
Sales growth (%)
23.2
FY17
24.6
FY18
29.5
FY19
30.0
FY20
35.7
FY21
Source: Company, MOFSL
8 November 2021
6
 Motilal Oswal Financial Services
P&G Hygiene and Healthcare
Exhibit 11: Common-size statement of operating expenses
As a % of Sales
COGS
Gross Margins
Staff Cost
Ad Spend
Other Operating Expenses
Total Operating Expenses
EBITDA Margin
FY17
39.4
60.6
4.9
8.8
18.2
71.4
28.6
FY18
38.6
61.4
4.7
10.6
20.5
74.4
25.6
FY19
42.0
58.0
4.5
10.6
22.2
79.3
20.7
FY20
36.9
63.0
5.8
10.9
25.7
79.3
20.6
FY21
32.4
67.6
5.6
14.6
27.9*
80.5
19.5
*Adjustments made to account for like-to-like growth as highlighted in 1Q and 2Q FY21 results
Source: Company, MOFSL
Comments on key cost items
Unlike disclosed in its quarterly press releases post the 1Q and 2QFY21 results,
the company has not called out one-offs in the Annual Report, leading to higher
reported EBITDA margins. We have retained the impact via the necessary
adjustments, as called out by the company in its interim press releases.
Some years ago, PGHH outsourced the manufacturing of its Vicks products to
P&G’s other entities. This has led to lower material costs, but subsequently
higher processing charges. We believe this is a key factor that has largely
contributed to the reduction in RM costs for the company in recent years. RM
costs as a percentage of sales plummeted 450bp YoY to 32.4% in FY21. These
are the lowest RM costs as a percentage of sales recorded since FY10.
Employee costs decreased 20bp YoY to 5.6% of sales in FY21. Employee costs as
a percentage of sales declined consistently over FY17–19, with a sharp increase
in FY20, which seems to have stabilized.
Ad spends as a percentage of sales surged 370bp YoY to 14.6% in FY21. Absolute
ad spends increased 59.1% in FY21, the highest among peers, in line with P&G’s
global strategy during the pandemic. This has worked well and is reflected in the
strong sales growth for the year – a key factor, especially in the Feminine Care
segment, where penetration levels are still ~20%. We believe while ad spends
are likely to be higher in subsequent years than 10.9% in FY20, they are unlikely
to be anywhere as high as 14.6% in FY21.
Royalties as a percentage of sales declined 80bp YoY to 4.5%.
Other expenses remained elevated at 19.5% of sales in FY21 (a reduction of
50bp from FY20), the highest level in the past 10 years. Processing charges have
played a big role in this increase.
8 November 2021
7
 Motilal Oswal Financial Services
P&G Hygiene and Healthcare
Exhibit 12: Breakdown of key operating expenses
Raw material (%)
Employee cost (%)
Ad spends (%)
Royalty (%)
Other expenses (%)
16.5
4.7
18.0
5.0
40.4
FY12
15.9
4.7
16.9
5.9
41.8
FY13
15.7
4.8
14.8
4.6
39.6
FY14
15.7
5.0
14.3
4.9
39.5
FY15
15.1
5.4
8.8
5.2
38.9
FY16
13.7
4.5
8.8
4.9
39.4
FY17
15.6
4.9
10.6
4.7
38.6
FY18
16.8
5.3
10.6
4.5
42.0
FY19
20.4
5.3
10.9
5.8
36.9
FY20
23.3
4.5
14.6
5.6
32.4
FY21
Source: Company, MOFSL
Exhibit 13: Ad spends as percentage of sales surge 370bp to 14.6% in FY21
16.9
14.8
14.3
13.1
10.6
8.8
8.8
10.6
10.9
Ad spends as % of sales
14.6
FY12
FY13
FY14
FY15
FY16
FY17
FY18
FY19
FY20
FY21
Source: Company, MOFSL
Exhibit 14: Absolute ad spends increase 59.1% YoY to INR5.2b in FY21
Ad spends (INR m)
5,225
2,853
3,029
3,327
3,254
2,605
2,006
2,037
3,133
3,283
FY12
FY13
FY14
FY15
FY16
FY17
FY18
FY19
FY20
FY21
Source: Company, MOFSL
Rent as a percentage of sales remained flat YoY (0.1%) in FY21. This was due to
the implementation of Ind-AS 116.
Processing charges as a percentage of sales remained elevated at 8.6% in FY21
(v/s9.7% in FY20, the highest level in 15 years). This increase in cost heads may
be attributed to higher charges by group companies as a part of related-party
transactions.
Freight as a percentage of sales declined 30bp YoY to 2.4% in FY21. It remained
far below the levels of 4.5–7% during FY10–14.
Business Process Outsourcing (BPO) expenses as a percentage of sales declined
40bps YoY to 1.7% in FY21.
8 November 2021
8
 Motilal Oswal Financial Services
P&G Hygiene and Healthcare
Other operating expenses (adjusted for like-to-like growth) as a percentage of
sales grew 80bp YoY to 6.7% in FY21. While expenses had increased to 6.2% in
FY18, current levels seem to be in line with the levels seen over FY14–16.
Other operating expenses (%)
Processing charges (%)
Business Process Outsourcing expenses (%)
1.2
5.7
1.9
4.8
3.0
0.2
6.0
FY13
1.3
5.2
2.4
0.1
6.7
FY14
1.3
3.6
2.5
0.3
8.0
FY15
1.3
3.7
2.5
1.6
5.9
FY16
Rent (%)
Freight (%)
2.1
2.7
9.7
0.1
5.8
FY20
1.7
2.4
8.6
0.1
10.4
FY21
Exhibit 15: Breakdown of key other operating expenses
3.2
0.1
6.2
FY12
1.1
3.1
2.9
1.1
5.5
FY17
1.7
2.6
3.3
1.8
6.2
FY18
2.1
2.7
4.6
1.6
5.8
FY19
*Other operating expenses include relevant adjustments in FY21 on the basis of information provided
in the notes to the quarterly results.
Source: Company, MOFSL
Comments on employee costs
The percentage increase in the median remuneration of employees for the
financial year is 5.5%.
463 permanent employees were on the company payroll in FY21, including 115
permanent women employees. 514 persons were engaged on a
temporary/contractual basis.
The average percentage increase in the salaries of employees other than the
managerial personnel was 8.9%in FY21, whereas the increase in the salaries paid
to managerial personnel was 19.7%. The average increase per year is an
outcome of the company’s market competitiveness against peer group
companies.
Exhibit 16: Average cost per head for permanent/total employees up 7%/5% in FY21
INR m
Total Staff Cost
Number of Permanent Employees
Number of Contractual Employees
Average cost per head – Permanent Employees
Average cost per head – Total Employees
FY17
1,141
362
250
3.2
1.9
FY18
1,152
359
350
3.2
1.6
FY19
FY20
FY21
1,338
1,733
2,017
380
424
463
390
447
514
3.5
4.1
4.4
1.7
2.0
2.1
Source: Company, MOFSL
8 November 2021
9
 Motilal Oswal Financial Services
P&G Hygiene and Healthcare
Exhibit 17: Remuneration of MD
(INR m)
Gross salary
Stock Option
Sweat Equity
Commission
Others
Total
Remuneration as % of staff cost
Remuneration as % of EBITDA
Remuneration as % of PAT
#
FY19
43.9
0
0
0
11.9
55.8
4.2
0.9
1.3
Mr. Madhusudan Gopalan
#
FY20
FY21
55.4
59.5
0
0
0
0
0
0
5.8
0
61.2
59.5
3.5
3.0
1.0
0.9
1.4
1.2
Source: Company, MOFSL
Mr. Madhusudan Gopalan is paid by the Company and portion of the remuneration is cross charged to
Gillette India Limited and Procter & Gamble Home Products Private Limited in proportion to their respective
Net Outside Sales.
Exhibit 18: Remuneration of CFO
(INR m)
Gross salary
Stock Option
Sweat Equity
Total
Remuneration as % of staff cost
Remuneration as % of EBITDA
Remuneration as % of PAT
FY19
4.8
0
0
4.8
0.4
0.1
0.1
Mr. Prashant Bhatnagar*
FY20
6.0
0
0
6.0
0.3
0.1
0.1
FY21
6.0
0
0
6.0
0.3
0.1
0.1
*Mr. Prashant Bhatnagar receives salary from another group Company, Gillette India Limited and the
Company contributes towards the same in proportion to its Net Outside Sales.
Lower cost of goods sold (COGS; -440bp YoY) and employee costs (-20bp YoY)
were offset by higher ad spends (+370bp YoY) and other expenses (+210bp). The
EBITDA margin, thus, declined 120bp YoY to 19.5%, the lowest level in the last
six years.
Unlike disclosed in its quarterly press releases post the 1Q and 2QFY21 results,
the company has not called out one-offs in the Annual Report, leading to higher
reported EBITDA margins. We have retained the impact via the necessary
adjustments, as called out by the company in its interim press releases.
Exhibit 19: EBITDA (adjusted) up 12.2% YoY to INR7b in FY21
EBITDA (INR b)
67.9
22.2
25.1
25.1
9.7
-5.5
-3.0
2.0
EBITDA growth (%)
15.1
12.2
2.0
FY12
2.5
FY13
4.2
FY14
4.8
FY15
6.1
FY16
6.6
FY17
6.3
FY18
6.1
FY19
6.2
FY20
7.0
FY21
Source: Company, MOFSL
8 November 2021
10
 Motilal Oswal Financial Services
P&G Hygiene and Healthcare
Exhibit 20: EBITDA margin (adjusted) down 120bp YoY to 19.5%
EBITDA margin (%)
FY12
FY13
FY14
FY15
FY16
FY17
FY18
FY19
FY20
FY21
Source: Company, MOFSL
Decrease in salience of other income
The salience of other income decreased on account of lower cash levels, given a
higher 202% payout in FY21. Furthermore, the reduction in loans to related
parties also led to lower other income. Other income as a proportion of PBT
decreased to 4.8% in FY21 from 7.3% in FY20.
A similar trajectory was seen earlier, when it declined in FY18 after the huge
special dividend in FY17, leading to a sharp reduction in cash and cash
equivalents.
Exhibit 21: Other income as % of PBT declines to 4.8% in FY21
Other income as a % of PBT
22.8
23.4
17.4
14.9
13.8
11.5
4.1
8.8
7.3
4.8
FY12
FY13
FY14
FY15
FY16
FY17
FY18
FY19
FY20
FY21
Source: Company, MOFSL
Exhibit 22: Adj. PAT up 13.2% YoY to INR5.1b in FY21
Adj PAT (INR b)
48.6
19.9 12.1
14.6
22.1
2.4
-11.5
1.8
FY12
2.0
FY13
3.0
FY14
3.5
FY15
4.2
FY16
4.3
FY17
3.8
FY18
4.2
FY19
4.5
FY20
5.1
FY21
9.5
6.8
13.2
Adj PAT growth (%)
Source: Company, MOFSL
8 November 2021
11
 Motilal Oswal Financial Services
P&G Hygiene and Healthcare
Exhibit 23: PAT margin declines 70bp YoY to 14.2% in FY21
Adj. PAT margin (%)
FY12
FY13
FY14
FY15
FY16
FY17
FY18
FY19
FY20
FY21
Source: Company, MOFSL
We expect EBITDA margins to expand hereafter on continued positive sales
momentum, leading to better fixed cost absorption, the stabilization of ad
spends at lower levels, and premiumization.
Dividend
In FY21, the Board of Directors declared an interim dividend of INR85 per share
and a special dividend of INR150 per share. The payment of the said interim
dividend and special dividend was completed on 25
th
Feb’21 and 27
th
May’21,
respectively.
A final dividend of INR80 per share has been declared and is subject to the
approval of the members at the ensuing 57
th
Annual General Meeting.
The dividend payout has been over 200% in FY21. It was close to 80% in FY19–
20; there was a blip in FY18 following the huge special dividend in FY17.
We believe intermittent special dividends in subsequent years would be an
ongoing feature of the company as a) it does not need the cash balance for
expansion and b) the cash increase on its books would impact RoCE and RoE.
Exhibit 24: Dividend payout rises to over 200% in FY21 after being near 80% in FY19/FY20
Dividend pay out (%)
292.2
202.0
78.6
78.1
40.3
39.9
29.6
FY14
28.4
FY15
27.7
FY16
FY17
34.0
FY18
FY19
FY20
FY21
FY12
FY13
Source: Company, MOFSL
8 November 2021
12
 Motilal Oswal Financial Services
P&G Hygiene and Healthcare
Balance sheet highlights
Working capital improves YoY (on average basis)
Negative net working capital days declined to 27 days in FY21 from 20 days in
FY20.
The decrease in inventory days (23 v/s 25 YoY) and debtor days (16 v/s 21 YoY)
was supported by flat creditor days (66 days), which led to the improvement.
From a longer term perspective, PGHH is once again seeing the trend of double-
digit negative NWC days, which the company witnessed before FY17, and it
continues to strengthen its position.
Exhibit 25: PGHH continues to improve working capital management, with cash conversion
cycle declining from -18 to -20 in FY19 and further to -27 days in FY21
Inventory days
58
22
23
11
Debtor days
56
20 21
24 22
Creditor days
54
22
21
57
20 20
Cash conversion cycle
59
66
66
50
14
21
15
39
19 16
47
25
21
23
16
(24)
FY12
(13)
FY13
(3)
FY14
(13)
FY15
(15)
FY16
(8)
FY17
(14)
FY18
(18)
FY19
(20)
FY20
(27)
FY21
Source: Company, MOFSL
Working capital sees sharp improvement YoY on year-end basis as well
Negative net working capital days improved further to 37 days in FY21 from 19
days in FY20.
While inventory days remained flat (25 days), the higher number of creditor
days (77 v/s 65 YoY) was complimented by lower debtor days (15 v/s 20 YoY).
Exhibit 26: On year-end basis, PGHH’s cash conversion cycle improves sharply by 18 days
to 37 days in FY21
Inventory days
Debtor days
58
41
21 15
19 18
20 24
52
28 21
Creditor days
57
18 22
60
25 22
Cash conversion cycle
68
25 20
65
25
15
77
72
44
26
14
26
17
(1)
(32)
FY12
FY13
(5)
(22)
FY14
FY15
(8)
FY16
(8)
FY17
(20)
FY18
(20)
FY19
(19)
FY20
(37)
FY21
Source: Company, MOFSL
Cash accumulation led to the deterioration of return ratios between FY18 and
FY20. The improvement in FY21 was led by improved working capital days and
cash and cash equivalents decreasing 26% YoY to INR7.1b.
8 November 2021
13
 Motilal Oswal Financial Services
P&G Hygiene and Healthcare
Exhibit 27: Return ratios improve on account of lower cash accumulation in FY21
RoE (%)
RoCE (%)
59.8
51.1
27.9
27.9
27.1
27.1
41.0
30.0
29.5
28.6
39.7
28.2
44.9
54.1
43.3
57.5
48.9
60.1
34.0
33.4
FY12
FY13
FY14
FY15
FY16
FY17
FY18
FY19
FY20
FY21
Source: Company, MOFSL
Exhibit 28: Cash and cash equivalents decrease 26% YoY to INR7.1b in FY21
Cash & cash equivalents (incl. other assets) (INR m)
11,507
9,624
6,923
2,760
2,711
3,717
1,891
4,795
5,999
7,136
FY12
FY13
FY14
FY15
FY16
FY17
FY18
FY19
FY20
FY21
Source: Company, MOFSL
Exhibit 29: Fixed asset turns up significantly in FY21
Gross fixed asset turnover (x)
Net fixed asset turnover (x)
19.4
9.8
12.6
14.5
6.5
7.9
8.6
7.5
7.2
8.1
3.8
FY12
4.5
FY13
4.8
FY14
4.5
FY15
3.9
FY16
5.8
FY17
6.2
FY18
7.1
6.4
7.1
FY19
FY20
FY21
Source: Company, MOFSL
8 November 2021
14
 Motilal Oswal Financial Services
P&G Hygiene and Healthcare
Exhibit 30: Other assets up 8.5% YoY in FY21 on higher advance tax payments
Growth in other assets & loans (%)
20.6
14.2
10.4
20.7
8.1
8.5
-16.4
-39.0
-11.5
-27.1
FY12
FY13
FY14
FY15
FY16
FY17
FY18
FY19
FY20
FY21
Source: Company, MOFSL
Exhibit 31: Breakdown of other assets and loans for past five years
Particulars (INR m)
FY17
Loans & Advances
Loan to related party
1,469
Other deposits
723
Balances with custom & excise
120
Advance tax paid
1,436
Total loans & advances
3,748
Other assets
Interest accrued on Loan to fellow subsidiary
52
Interest accrued on bank deposits
2
Others
2
Total other assets
56
Total other assets & loans
3,803
FY18
1,009
799
684
1,958
4,450
135
2
5
142
4,591
FY19
1,098
595
756
1,398
3,848
61
0
9
70
4,219
FY20
182
599
794
1,312
2,886
0
0
76
76
2,963
FY21
227
534
941
1,512
3,214
0
0
0
0
3,214
Source: Company, MOFSL
Related-party transactions
There were no loans outstanding to related parties at the end of FY21. This was
the second year in a row (all loans outstanding were cleared by related parties
in FY20) despite healthy cash and cash equivalents.
Trade and other receivables from related parties stood at INR293m in FY21
(INR216m in FY20), 0.8% of full-year revenues.
Trade payables to related parties stood at INR1.2b in FY21 (INR1.3b in FY20),
10.3% of full-year COGS.
The purchase of goods from related parties declined 52% YoY to INR129m in
FY21.
The purchase of goods as a percentage of COGS decreased to 1.1% in FY21 from
2.4% in FY20.
BPO expenses decreased 9% YoY to INR598m.
Exhibit 32: Goods purchase from related parties down to 1.1% of COGS in FY21 from 13.5%
in FY19
INR m
FY19
FY20
FY21
Purchase of Goods
1,664
266
129
Purchase of Goods as % of COGS (%)
13.5
2.4
1.1
Source: Company, MOFSL
8 November 2021
15
 Motilal Oswal Financial Services
P&G Hygiene and Healthcare
Other comments
Forex income grew 60% YoY to INR375m in FY20, whereas forex expenses
declined 21.2% YoY to INR5.9b. Forex expenses as a percentage of sales declined
to 19.8% in FY20 from 25.6% in FY19.
Exhibit 33: Breakdown of net forex earnings
Particulars (INR m)
Foreign Exchange earnings
Change (%)
Foreign Exchange outgo
Change (%)
Net Foreign Exchange earnings
Change (%)
FY18
264
-52.4
5,600
29.4
(5,336)
42.1
FY19
242
-8.1
7,532
36.6
(7,290)
38.9
FY20
FY21
375
460
55.0
22.5
5,939
5,503
-18.5
-7.3
(5,563)
(5,043)
-21.1
-9.3
Source: Company, MOFSL
The company managed to fulfill its CSR obligation of INR118m for FY21.
Exhibit 34: PGHH spends 2.4x its prescribed CSR obligation in FY21
Year
Average net profit for last 3 years
Prescribed CSR expenditure for FY20 (2% of average net profit)
Total amount actually spent on CSR activities
Amount unspent
FY21
5,903
118.1
288.1
Nil
Source: Company, MOFSL
Social initiatives
The P&G group in India (including other P&G entities in India apart from PGHH),
has contributed nearly INR500m during the year. This has been in the form of
donations to more than 20 state governments, which would benefit nearly 5m
citizens.
The P&G group in India has also donated nearly 2m masks and sanitizers to
support frontline workers.
P&G entities in India are also partnering with Tata Trusts to support hospital
capacity expansion in the country, an essential need in these tough times.
Since the outbreak of the pandemic, PGHH, in partnership with the government
and relief organizations, has distributed over 3.5m Whisper sanitary pads to
women and girls from underprivileged and migrant communities, childcare
institutions, frontline healthcare workers, and sanitation workers across the
country.
Energy conservation and waste management
Carbon footprint reduction:
The manufacturing plant in Goa is a ‘zero waste to
landfill’ site, which means there is no manufacturing discharge in the
environment.
Carbon emission reduction:
In the last 10 years, the Goa plant has reduced its
carbon emissions by 90% and energy consumption by nearly 30%. The plant is
leveraging technology, experts, employees, and renewable sources of energy to
reduce the overall carbon footprint, improve energy and water efficiency, and
make operations more sustainable.
Plastic reduction:
P&G entities in India are committed to helping reduce the
flow of plastic by making changes now and bringing long-term solutions. In
16
8 November 2021
 Motilal Oswal Financial Services
P&G Hygiene and Healthcare
India, the company has put in place a system to recover and recycle multi-
layered plastic packaging waste. It is working with various waste management
companies and the industry to collect, segregate, and recycle multi-layered
plastic packaging waste. Last year, P&G India collected, segregated, and recycled
over 7,200mt of waste. It is building partnerships with external organizations to
combat some of the current challenges and issues related to sustainability.
Incentivizing the unorganized sector:
In India, the focus is on incentivizing the
unorganized sector through investments in businesses, value additions to
collecting and sorting waste, and expanding plastic waste processing and
recycling capacity.
Sustainable solutions:
In 2019, P&G India set up an ‘Environmental
Sustainability Fund’ to collaborate with external partners offering
environmentally sustainable business solutions. Through this fund, its goal is to
identify and implement step-changing environmentally sustainable solutions
such as packaging innovations, renewable sources of energy, and reducing
carbon footprint.
Water-saving initiatives:
The following initiatives led to significant water
savings:
Optimizing the use of water resources
Reclaiming and using circular water
Using rainwater v/s groundwater for cooling towers
Using air conditioning drains to recharge earthing pits
Energy-saving initiatives:
Certain initiatives undertaken for energy saving are
given below:
Using energy efficient compressors
Monitoring air consumption and arresting and controlling air leakages
Monthly energy monitoring by Energy Management System and
benchmarking
Installing energy efficient pumps and fans for cooling towers
Installing variable frequency drives (VFDs) for compressors and sequencing
VFDs for energy efficiency
Capital investments:
Capital investments worth approximately INR7m were
incurred on energy conservation equipment, such as energy efficient pumps and
fans for cooling towers, energy efficient compressors, and variable frequency
drives.
P&G’s global sustainability efforts
P&G's broad-reaching environmental sustainability goals are designed to enable
responsible consumption and sustainable manufacturing.
All P&G brands would enable responsible consumption through packaging that
is 100% recyclable or reusable by 2030.
By 2030, 100% of P&G manufacturing sites across the globe would cut
greenhouse gas emissions in half v/s the 2010 baseline.
It strives to grow operations responsibly, constantly improving efficiency, while
reducing the environmental footprint.
In 2019, P&G joined forces with more than 40 companies globally that make
plastic, use plastic in their products and packaging, and recycle and manage
plastic waste to form 'The Alliance to End Plastic Waste'. The Alliance is
17
8 November 2021
 Motilal Oswal Financial Services
P&G Hygiene and Healthcare
supporting an array of projects and partnerships that focus on solutions in four
core areas: infrastructure, innovation, education, and cleanup, with particular
emphasis where the need is most urgent in Southeast Asia, including India.
New board and senior management appointees
During the year, Mr Chittranjan Dua and Mr Krishnamurthy Iyer were appointed
Independent Directors of the company for a period of five years, effective from
25
th
August 2020 and 1
st
December 2020, respectively.
Mr Chittranjan Dua was appointed Chairman of the Board with effect from 24
th
September 2020.
Mr Ghanashyam Hegde was appointed Company Secretary and Compliance
Officer of the company effective from 1
st
September 2021. He was also
appointed Executive Director of the company for a period of five years, effective
from 1
st
September 2021. The said appointment as Executive Director is subject
to the approval of the company shareholders at the ensuing 57
th
Annual General
Meeting.
Directors Mr Karthik Natarajan and Mr Pramod Agarwal retire by rotation, and
being eligible, would offer themselves for re-appointment at the ensuing 57
th
Annual General Meeting.
8 November 2021
18
 Motilal Oswal Financial Services
P&G Hygiene and Healthcare
Financials and valuations
Standalone - Income Statement
Y/E June
Total Income from Operations
Change (%)
Raw Materials
% of Sales
Employees Cost
% of Sales
Other Expenses
% of Sales
Total Expenditure
% of Sales
EBITDA
Margin (%)
Depreciation
EBIT
Int. and Finance Charges
Other Income
PBT bef. EO Exp.
EO Items
PBT after EO Exp.
Total Tax
Tax Rate (%)
Reported PAT
Adjusted PAT
Change (%)
Margin (%)
FY17
23,204
2.0
9,150
39.4
1,141
4.9
6,267
27.0
16,558
71.4
6,646
28.6
597
6,049
104
773
6,718
0
6,718
2,390
35.6
4,327
4,327
2.4
18.6
0.0
FY17
325
4,937
5,261
-263
0
4,999
4,024
1,167
2,857
0
408
0
8,073
1,774
1,328
1,168
3,803
6,340
3,632
2,150
558
1,733
4,999
0
FY18
24,553
5.8
9,487
38.6
1,152
4.7
7,634
31.1
18,273
74.4
6,280
25.6
524
5,756
53
241
5,944
-82
5,862
2,116
36.1
3,746
3,828
-11.5
15.6
0.0
FY18
325
7,730
8,055
-230
0
7,825
3,975
1,474
2,501
0
215
0
11,308
1,236
1,485
3,996
4,591
6,199
4,062
1,606
530
5,109
7,825
0
FY19
29,469
20.0
12,368
42.0
1,338
4.5
9,670
32.8
23,376
79.3
6,093
20.7
498
5,595
55
533
6,073
6,073
1,882
31.0
4,191
4,191
9.5
14.2
0.0
FY19
325
8,766
9,091
-368
0
8,723
4,145
1,803
2,342
0
146
0
13,315
2,034
1,814
5,405
4,063
7,080
5,477
895
709
6,235
8,723
0
FY20
30,020
1.9
11,068
36.9
1,733
5.8
11,003
36.7
23,804
79.3
6,216
20.7
479
5,738
61
441
6,118
-105
6,013
1,642
27.3
4,371
4,476
6.8
14.9
0.0
FY20
325
11,254
11,579
-296
15
11,298
4,674
2,609
2,065
0
222
0
15,702
2,051
1,663
9,025
2,963
6,691
5,313
587
790
9,011
11,298
0
FY21
35,741
19.1
11,593
32.4
2,017
5.6
15,160
42.4
28,770
80.5
6,972
19.5
477
6,495
61
394
6,828
1,450
8,277
1,759
21.3
6,518
5,068
13.2
14.2
0.0
FY21
325
6,818
7,143
-380
2
6,764
5,052
3,214
1,838
0
376
0
13,733
2,493
1,424
6,602
3,214
9,183
7,541
764
878
4,550
6,764
0
FY22E
39,173
9.6
12,710
32.4
2,115
5.4
14,298
36.5
29,123
74.3
10,050
25.7
528
9,522
45
433
9,910
0
9,910
2,497
25.2
7,413
7,413
46.3
18.9
0.0
FY22E
325
7,559
7,884
-418
2
7,468
4,764
3,379
1,386
0
200
0
14,627
2,790
2,790
5,832
3,214
8,745
6,994
840
911
5,882
7,468
0
(INR m)
FY23E
46,311
18.2
14,588
31.5
2,501
5.4
16,672
36.0
33,761
72.9
12,550
27.1
572
11,978
55
591
12,515
0
12,515
3,154
25.2
9,361
9,361
26.3
20.2
0.0
Standalone - Balance Sheet
Y/E June
Equity Share Capital
Total Reserves
Net Worth
Deferred Tax Liabilities
Total Loans
Capital Employed
Gross Block
Less: Accum. Deprn.
Net Fixed Assets
Goodwill on Consolidation
Capital WIP
Total Investments
Curr. Assets, Loans&Adv.
Inventory
Account Receivables
Cash and Bank Balance
Loans and Advances
Curr. Liability & Prov.
Account Payables
Other Current Liabilities
Provisions
Net Current Assets
Appl. of Funds
E: MOFSL Estimates
(INR m)
FY23E
325
8,495
8,820
-460
2
8,362
4,432
3,951
481
0
200
0
17,599
2,791
2,538
9,056
3,214
9,918
7,992
924
1,002
7,681
8,362
0
8 November 2021
19
 Motilal Oswal Financial Services
P&G Hygiene and Healthcare
Financials and valuations
Ratios
Y/E June
Basic (INR)
EPS
Cash EPS
BV/Share
DPS
Payout (%)
Valuation (x)
P/E
Cash P/E
P/BV
EV/Sales
EV/EBITDA
Dividend Yield (%)
FCF per share
Return Ratios (%)
RoE
RoCE
Working Capital Ratios
Asset Turnover (x)
Inventory (Days)
Debtor (Days)
Creditor (Days)
Leverage Ratio (x)
Debt/Equity
FY17
133.1
151.7
162.1
389
292.2
108.6
95.3
89.2
20.2
70.4
2.7
123.7
39.7
41.0
4.6
24
22
54
0.0
FY18
117.8
134.1
248.2
40
34.0
122.7
107.8
58.2
18.9
74.1
0.3
116.3
57.5
59.8
3.1
22
21
57
0.0
FY19
129.0
144.5
280.1
101
78.6
112.1
100.1
51.6
15.7
76.1
0.7
126.4
48.9
51.1
3.4
20
20
59
0.0
FY20
137.7
152.7
356.7
105
78.1
104.9
94.7
40.5
15.3
74.0
0.7
130.5
43.3
44.9
2.7
25
21
66
0.0
FY21
156.1
170.8
220.0
315
202.0
92.6
84.6
65.7
12.9
66.3
2.2
256.2
54.1
60.1
5.3
23
16
66
0.0
FY22E
228.4
244.6
242.9
206
90.0
63.3
59.1
59.5
11.8
46.1
1.4
182.2
98.7
104.6
5.2
26
26
64
0.0
FY23E
288.4
306.0
271.7
260
90.0
50.1
47.2
53.2
9.9
36.7
1.8
343.6
112.1
118.8
5.5
22
20
62
0.0
Standalone - Cash Flow Statement
Y/E June
PBT
Depreciation
Net interest expense
Others
(Inc)/Dec in WC
Taxes
CF from Operations
(Inc)/Dec in FA
Free Cash Flow
(Pur)/Sale of Investments
Others
CF from Investments
Issue of Shares
Inc/(Dec) in Debt
Dividend Paid
Interest Paid
Others
CF from Fin. Activity
Inc/Dec of Cash
Opening Balance
Closing Balance
E: MOFSL Estimates
FY17
6,718
597
-644
146
135
-2,500
4,453
-438
4,015
0
2,009
1,571
0
0
-15,550
-37
0
-15,587
-9,564
10,732
1,168
FY18
5,818
524
-147
225
466
-2,731
4,155
-381
3,774
0
115
-266
0
0
-1,055
-6
0
-1,061
2,828
1,168
3,996
FY19
6,073
498
-317
54
172
-2,350
4,130
-28
4,102
-7
451
416
0
0
-3,131
-7
0
-3,137
1,409
3,996
5,405
FY20
5,939
479
-266
203
-179
-1,435
4,741
-503
4,237
22
1,265
783
0
0
-1,878
-9
-16
-1,903
3,621
5,405
9,025
FY21
8,699
477
-250
139
2,101
-2,534
8,631
-315
8,317
0
325
11
0
0
-11,037
-10
-18
-11,064
-2,423
9,025
6,603
FY22E
9,910
528
-388
0
-2,102
-2,497
5,450
464
5,914
0
32
496
0
0
-6,672
-45
0
-6,717
-770
6,603
5,832
(INR m)
FY23E
12,515
572
-536
0
1,425
-3,154
10,821
333
11,154
0
550
882
0
0
-8,425
-55
0
-8,480
3,224
5,832
9,056
8 November 2021
20
 Motilal Oswal Financial Services
P&G Hygiene and Healthcare
Explanation of Investment Rating
Investment Rating
Expected return (over 12-month)
BUY
>=15%
SELL
< - 10%
NEUTRAL
< - 10 % to 15%
UNDER REVIEW
Rating may undergo a change
NOT RATED
We have forward looking estimates for the stock but we refrain from assigning recommendation
*In case the recommendation given by the Research Analyst is inconsistent with the investment rating legend for a continuous period of 30 days, the Research Analyst shall within
following 30 days take appropriate measures to make the recommendation consistent with the investment rating legend.
Disclosures
The following Disclosures are being made in compliance with the SEBI Research Analyst Regulations 2014 (herein after referred to as the Regulations).
Motilal Oswal Financial Services Ltd. (MOFSL) is a SEBI Registered Research Analyst having registration no. INH000000412. MOFSL, the Research Entity (RE) as defined in the
Regulations, is engaged in the business of providing Stock broking services, Investment Advisory Services, Depository participant services & distribution of various financial
products. MOFSL is a subsidiary company of Passionate Investment Management Pvt. Ltd.. (PIMPL). MOFSL is a listed public company, the details in respect of which are
available on www.motilaloswal.com. MOFSL (erstwhile Motilal Oswal Securities Limited - MOSL) is registered with the Securities & Exchange Board of India (SEBI) and is a
registered Trading Member with National Stock Exchange of India Ltd. (NSE) and Bombay Stock Exchange Limited (BSE), Multi Commodity Exchange of India Limited (MCX) and
National Commodity & Derivatives Exchange Limited (NCDEX) for its stock broking activities & is Depository participant with Central Depository Services Limited (CDSL) National
Securities Depository Limited (NSDL),NERL, COMRIS and CCRL and is member of Association of Mutual Funds of India (AMFI) for distribution of financial products and Insurance
Regulatory & Development Authority of India (IRDA) as Corporate Agent for insurance products.
Details of associate entities of Motilal Oswal Financial Services Limited are
available on the website at
http://onlinereports.motilaloswal.com/Dormant/documents/List%20of%20Associate%20companies.pdf
MOFSL and its associate company(ies), their directors and Research Analyst and their relatives may; (a) from time to time, have a long or short position in, act as principal in, and
buy or sell the securities or derivatives thereof of companies mentioned herein. (b) be engaged in any other transaction involving such securities and earn brokerage or other
compensation or act as a market maker in the financial instruments of the company(ies) discussed herein or act as an advisor or lender/borrower to such company(ies) or may have
any other potential conflict of interests with respect to any recommendation and other related information and opinions.; however the same shall have no bearing whatsoever on the
specific recommendations made by the analyst(s), as the recommendations made by the analyst(s) are completely independent of the views of the associates of MOFSL even
though there might exist an inherent conflict of interest in some of the stocks mentioned in the research report
MOFSL and / or its affiliates do and seek to do business including investment banking with companies covered in its research reports. As a result, the recipients of this report
should be aware that MOFSL may have a potential conflict of interest that may affect the objectivity of this report. Compensation of Research Analysts is not based on any specific
merchant banking, investment banking or brokerage service transactions. Details of pending Enquiry Proceedings of Motilal Oswal Financial Services Limited are available on the
website at
https://galaxy.motilaloswal.com/ResearchAnalyst/PublishViewLitigation.aspx
A graph of daily closing prices of securities is available at
www.nseindia.com, www.bseindia.com.
Research Analyst views on Subject Company may vary based on Fundamental
research and Technical Research. Proprietary trading desk of MOFSL or its associates maintains arm’s length distance with Research Team as all the activities are segregated
from MOFSL research activity and therefore it can have an independent view with regards to Subject Company for which Research Team have expressed their views.
Regional Disclosures (outside India)
This report is not directed or intended for distribution to or use by any person or entity resident in a state, country or any jurisdiction, where such distribution, publication, availability
or use would be contrary to law, regulation or which would subject MOFSL & its group companies to registration or licensing requirements within such jurisdictions.
For Hong Kong:
This report is distributed in Hong Kong by Motilal Oswal capital Markets (Hong Kong) Private Limited, a licensed corporation (CE AYY-301) licensed and regulated by the Hong
Kong Securities and Futures Commission (SFC) pursuant to the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) “SFO”. As per SEBI (Research Analyst
Regulations) 2014 Motilal Oswal Securities (SEBI Reg No. INH000000412) has an agreement with Motilal Oswal capital Markets (Hong Kong) Private Limited for distribution of
research report in Hong Kong. This report is intended for distribution only to “Professional Investors” as defined in Part I of Schedule 1 to SFO. Any investment or investment activity
to which this document relates is only available to professional investor and will be engaged only with professional investors.” Nothing here is an offer or solicitation of these
securities, products and services in any jurisdiction where their offer or sale is not qualified or exempt from registration. The Indian Analyst(s) who compile this report is/are not
located in Hong Kong & are not conducting Research Analysis in Hong Kong.
For U.S.
Motilal Oswal Financial Services Limited (MOFSL) is not a registered broker - dealer under the U.S. Securities Exchange Act of 1934, as amended (the"1934 act") and under
applicable state laws in the United States. In addition MOFSL is not a registered investment adviser under the U.S. Investment Advisers Act of 1940, as amended (the "Advisers
Act" and together with the 1934 Act, the "Acts), and under applicable state laws in the United States. Accordingly, in the absence of specific exemption under the Acts, any
brokerage and investment services provided by MOFSL , including the products and services described herein are not available to or intended for U.S. persons. This report is
intended for distribution only to "Major Institutional Investors" as defined by Rule 15a-6(b)(4) of the Exchange Act and interpretations thereof by SEC (henceforth referred to as
"major institutional investors"). This document must not be acted on or relied on by persons who are not major institutional investors. Any investment or investment activity to which
this document relates is only available to major institutional investors and will be engaged in only with major institutional investors. In reliance on the exemption from registration
provided by Rule 15a-6 of the U.S. Securities Exchange Act of 1934, as amended (the "Exchange Act") and interpretations thereof by the U.S. Securities and Exchange
Commission ("SEC") in order to conduct business with Institutional Investors based in the U.S., MOFSL has entered into a chaperoning agreement with a U.S. registered broker-
dealer, Motilal Oswal Securities International Private Limited. ("MOSIPL"). Any business interaction pursuant to this report will have to be executed within the provisions of this
chaperoning agreement.
The Research Analysts contributing to the report may not be registered /qualified as research analyst with FINRA. Such research analyst may not be associated persons of the U.S.
registered broker-dealer, MOSIPL, and therefore, may not be subject to NASD rule 2711 and NYSE Rule 472 restrictions on communication with a subject company, public
appearances and trading securities held by a research analyst account.
For Singapore
In Singapore, this report is being distributed by Motilal Oswal Capital Markets Singapore Pte Ltd (“MOCMSPL”) (Co.Reg. NO. 201129401Z) which is a holder of a capital markets
services license and an exempt financial adviser in Singapore.As per the approved agreement under Paragraph 9 of Third Schedule of Securities and Futures Act (CAP 289) and
Paragraph 11 of First Schedule of Financial Advisors Act (CAP 110) provided to MOCMSPL by Monetary Authority of Singapore. Persons in Singapore should contact MOCMSPL
in respect of any matter arising from, or in connection with this report/publication/communication. This report is distributed solely to persons who qualify as “Institutional Investors”,
of which some of whom may consist of "accredited" institutional investors as defined in section 4A(1) of the Securities and Futures Act, Chapter 289 of Singapore (“the
SFA”). Accordingly, if a Singapore person is not or ceases to be such an institutional investor, such Singapore Person must immediately discontinue any use of this Report and
inform MOCMSPL.
Specific Disclosures
1 MOFSL, Research Analyst and/or his relatives does not have financial interest in the subject company, as they do not have equity holdings in the subject company.
2 MOFSL, Research Analyst and/or his relatives do not have actual/beneficial ownership of 1% or more securities in the subject company
3 MOFSL, Research Analyst and/or his relatives have not received compensation/other benefits from the subject company in the past 12 months
4 MOFSL, Research Analyst and/or his relatives do not have material conflict of interest in the subject company at the time of publication of research report
5 Research Analyst has not served as director/officer/employee in the subject company
6 MOFSL has not acted as a manager or co-manager of public offering of securities of the subject company in past 12 months
7 MOFSL has not received compensation for investment banking/ merchant banking/brokerage services from the subject company in the past 12 months
8 MOFSL has not received compensation for other than investment banking/merchant banking/brokerage services from the subject company in the past 12 months
9 MOFSL has not received any compensation or other benefits from third party in connection with the research report
10 MOFSL has not engaged in market making activity for the subject company
8 November 2021
21
 Motilal Oswal Financial Services
P&G Hygiene and Healthcare
********************************************************************************************************************************
The associates of MOFSL may have:
- financial interest in the subject company
- actual/beneficial ownership of 1% or more securities in the subject company
- received compensation/other benefits from the subject company in the past 12 months
- other potential conflict of interests with respect to any recommendation and other related information and opinions.; however the same shall have no bearing whatsoever on the
specific recommendations made by the analyst(s), as the recommendations made by the analyst(s) are completely independent of the views of the associates of MOFSL even
though there might exist an inherent conflict of interest in some of the stocks mentioned in the research report.
- acted as a manager or co-manager of public offering of securities of the subject company in past 12 months
- be engaged in any other transaction involving such securities and earn brokerage or other compensation or act as a market maker in the financial instruments of the
company(ies) discussed herein or act as an advisor or lender/borrower to such company(ies)
- received compensation from the subject company in the past 12 months for investment banking / merchant banking / brokerage services or from other than said services.
The associates of MOFSL has not received any compensation or other benefits from third party in connection with the research report
Above disclosures include beneficial holdings lying in demat account of MOFSL which are opened for proprietary investments only. While calculating beneficial holdings, It does not
consider demat accounts which are opened in name of MOFSL for other purposes (i.e holding client securities, collaterals, error trades etc.). MOFSL also earns DP income from
clients which are not considered in above disclosures.
Analyst Certification
The views expressed in this research report accurately reflect the personal views of the analyst(s) about the subject securities or issues, and no part of the compensation of the
research analyst(s) was, is, or will be directly or indirectly related to the specific recommendations and views expressed by research analyst(s) in this report.
Terms & Conditions:
This report has been prepared by MOFSL and is meant for sole use by the recipient and not for circulation. The report and information contained herein is strictly confidential and
may not be altered in any way, transmitted to, copied or distributed, in part or in whole, to any other person or to the media or reproduced in any form, without prior written consent
of MOFSL. The report is based on the facts, figures and information that are considered true, correct, reliable and accurate. The intent of this report is not recommendatory in
nature. The information is obtained from publicly available media or other sources believed to be reliable. Such information has not been independently verified and no guaranty,
representation of warranty, express or implied, is made as to its accuracy, completeness or correctness. All such information and opinions are subject to change without notice. The
report is prepared solely for informational purpose and does not constitute an offer document or solicitation of offer to buy or sell or subscribe for securities or other financial
instruments for the clients. Though disseminated to all the customers simultaneously, not all customers may receive this report at the same time. MOFSL will not treat recipients as
customers by virtue of their receiving this report.
Disclaimer:
The report and information contained herein is strictly confidential and meant solely for the selected recipient and may not be altered in any way, transmitted to, copied or
distributed, in part or in whole, to any other person or to the media or reproduced in any form, without prior written consent. This report and information herein is solely for
informational purpose and may not be used or considered as an offer document or solicitation of offer to buy or sell or subscribe for securities or other financial instruments. Nothing
in this report constitutes investment, legal, accounting and tax advice or a representation that any investment or strategy is suitable or appropriate to your specific circumstances.
The securities discussed and opinions expressed in this report may not be suitable for all investors, who must make their own investment decisions, based on their own investment
objectives, financial positions and needs of specific recipient. This may not be taken in substitution for the exercise of independent judgment by any recipient. Each recipient of this
document should make such investigations as it deems necessary to arrive at an independent evaluation of an investment in the securities of companies referred to in this
document (including the merits and risks involved), and should consult its own advisors to determine the merits and risks of such an investment. The investment discussed or views
expressed may not be suitable for all investors. Certain transactions -including those involving futures, options, another derivative products as well as non-investment grade
securities - involve substantial risk and are not suitable for all investors. No representation or warranty, express or implied, is made as to the accuracy, completeness or fairness of
the information and opinions contained in this document. The Disclosures of Interest Statement incorporated in this document is provided solely to enhance the transparency and
should not be treated as endorsement of the views expressed in the report. This information is subject to change without any prior notice. The Company reserves the right to make
modifications and alternations to this statement as may be required from time to time without any prior approval. MOFSL, its associates, their directors and the employees may from
time to time, effect or have effected an own account transaction in, or deal as principal or agent in or for the securities mentioned in this document. They may perform or seek to
perform investment banking or other services for, or solicit investment banking or other business from, any company referred to in this report. Each of these entities functions as a
separate, distinct and independent of each other. The recipient should take this into account before interpreting the document. This report has been prepared on the basis of
information that is already available in publicly accessible media or developed through analysis of MOFSL. The views expressed are those of the analyst, and the Company may or
may not subscribe to all the views expressed therein. This document is being supplied to you solely for your information and may not be reproduced, redistributed or passed on,
directly or indirectly, to any other person or published, copied, in whole or in part, for any purpose. This report is not directed or intended for distribution to, or use by, any person or
entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction, where such distribution, publication, availability or use would be contrary to law,
regulation or which would subject MOFSL to any registration or licensing requirement within such jurisdiction. The securities described herein may or may not be eligible for sale in
all jurisdictions or to certain category of investors. Persons in whose possession this document may come are required to inform themselves of and to observe such restriction.
Neither the Firm, not its directors, employees, agents or representatives shall be liable for any damages whether direct or indirect, incidental, special or consequential including lost
revenue or lost profits that may arise from or in connection with the use of the information.
The person accessing this information specifically agrees to exempt MOFSL or any of its
affiliates or employees from, any and all responsibility/liability arising from such misuse and agrees not to hold MOFSL or any of its affiliates or employees responsible for any such
misuse and further agrees to hold MOFSL or any of its affiliates or employees free and harmless from all losses, costs, damages,
expenses that may be suffered by the person
accessing this information due to any errors and delays.
Registered Office Address: Motilal Oswal Tower, Rahimtullah Sayani Road, Opposite Parel ST Depot, Prabhadevi, Mumbai-400025; Tel No.: 022 71934200/ 022-71934263;
Website
www.motilaloswal.com.CIN
no.: L67190MH2005PLC153397.Correspondence Office Address: Palm Spring Centre, 2nd Floor, Palm Court Complex, New Link Road,
Malad(West), Mumbai- 400 064. Tel No: 022 7188 1000.
Registration Nos.: Motilal Oswal Financial Services Limited (MOFSL)*: INZ000158836(BSE/NSE/MCX/NCDEX); CDSL and NSDL: IN-DP-16-2015; Research Analyst:
INH000000412. AMFI: ARN - 146822; Investment Adviser: INA000007100; Insurance Corporate Agent: CA0579;PMS:INP000006712. Motilal Oswal Asset Management Company
Ltd. (MOAMC): PMS (Registration No.: INP000000670); PMS and Mutual Funds are offered through MOAMC which is group company of MOFSL. Motilal Oswal Wealth
Management Ltd. (MOWML): PMS (Registration No.: INP000004409) is offered through MOWML, which is a group company of MOFSL. Motilal Oswal Financial Services Limited is
a distributor of Mutual Funds, PMS, Fixed Deposit, Bond, NCDs,Insurance Products and IPOs.Real Estate is offered through Motilal Oswal Real Estate Investment Advisors II Pvt.
Ltd. which is a group company of MOFSL. Private Equity is offered through Motilal Oswal Private Equity Investment Advisors Pvt. Ltd which is a group company of MOFSL.
Research & Advisory services is backed by proper research. Please read the Risk Disclosure Document prescribed by the Stock Exchanges carefully before investing. There is no
assurance or guarantee of the returns. Investment in securities market is subject to market risk, read all the related documents carefully before investing. Details of Compliance
Officer: Name: Neeraj Agarwal, Email ID: na@motilaloswal.com, Contact No.:022-71881085.
* MOSL has been amalgamated with Motilal Oswal Financial Services Limited (MOFSL) w.e.f August 21, 2018 pursuant to order dated July 30, 2018 issued by Hon'ble National
Company Law Tribunal, Mumbai Bench.
8 November 2021
22