MARKET

VALUE RATIOS Annual Report Analysis o

Ratio of last 3 annual years

Godrej Consumer
Products
 BOOK VALUE PER SHARE RATIO
Shareholder’s Equity – Preferred Equity
FORMULA
Total Common Shares Outstanding

YEAR RATIO Book Value per Share Ratio

2021 92.31 100
90
2020 77.26 80
70
2019 71.09 60
50
40
30
20
10
0
2019 2020 2021
 DIVIDEND YIELD RATIO
Dividend Per Share
FORMULA
Share Price

YEAR RATIO Dividend Yield Ratio

2.50%
2021 0
2.00%
2020 1.48%
1.50%
2019 2.12%
1.00%

0.50%

0.00%
2019 2020 2021
 EARNINGS PER SHARE RATIO
FORMULA Net Earnings
Total Shares Outstanding

YEAR RATIO Earnings Per Share Ratio

2021 16.83 25

2020 14.64 20

2019 22.91 15

10

0
2019 2020 2021
 PRICE EARNINGS RATIO
Share Price
FORMULA
Earnings Per Share

YEAR RATIO Price Earnings Ratio

2021 43.35
50
2020 35.58 40
2019 29.94 30
20
10
0
2019 2020 2021
 SWOT Analysis of Godrej Consumer
Products
Godrej Consumer Products limited (GCPL) is one of the leading FMCG
companies in India. It offers products in soap, toiletries, cosmetics, household
care, hair care and fabric care categories. GCPL operates in more than 60
countries in Asia, Africa, Europe, Middle East and Latin America.
• Strength
• Strong Brand Portfolio :
GCPL is one of the largest FMCG companies in India with a broad brand
portfolio and the wide range of customers. According to company
estimates, over 600 million people use a Godrej produce every day.
 The company has been able to create a strong brand portfolio which
enables it to reach to various different consumer segments.
• Strong market positions in multiple categories:
GCPL has leading market positions in categories such as hair colours,
household insecticides and liquid detergents. It has also maintained a strong
position in the soap category.

• Ability to create a strong brand:

GCPL has been able to create strong brands in various segments such as
Good Knight, Godrej No.1 and Cinthol etc. With strong marketing and
distribution, GCPL products are popular and enjoy high brand awareness.
 • Focus on Innovation:
GCPL has been focusing on innovation and expanding its product portfolio
through brand extensions and new product launches. This is supported by
company’s robust R&D facilities which enable it to improvements in product
quality, cost savings, improvements in packaging and higher efficiency.

• Increasing presence in a Global market:

GCPL is on the look forward to expand itself globally especially in the
emerging nations. In FY 2015, GCPL’s share of revenue from international
market was 47.5% of its total revenue. The company is present in more than
60 countries like Sri Lanka, Bangladesh, South Africa, Argentina and Kenya
etc.
2. Weaknesses
• Lack of scale:
Even after building a strong brand portfolio and distribution, GCPL lacks
scale like ITC or HUL which are its competitors in various FMCG
segments. These companies have the financial strength to diversify in
different business and invest higher in more products. This affects GCPL’s
competitiveness to these companies.

• Stiff competition affects market share:

India has various players in many of the categories in the FMCG
industry. This ensures stiff competition in the market and hence limits
the market share for GCPL. The entry of Patanjali has also reduced the
market share of the FMCG giants in many categories.
• Rural Market Penetration:

The rural penetration of GCPL is much less due to the lack of awareness
of the importance of consumer products in rural areas and also to the
comparatively higher price of products compared to rural products.

• Increasing Product Cost:

One of the major problems faced by GCPL as a brand is the increase
in the cost of transport, labour and other distribution and operating
costs of the brand over the years. That naturally affects the pricing of
the product.
3. Opportunities
• Inorganic Expansion:
GCPL has transformed itself from a domestic company to a multi-national
company having a presence in over 60 countries. GCPL has been expanding
in emerging nations by acquiring some of the local brands to set up in those
countries, for instance, acquisition of Frika Hair in South Africa and Canon
Chemicals in Kenya. This helps the company to improve market penetration
in such countries.

• Growing Personal care market:

With increasing purchasing power and improving the lifestyle of people,
demand in personal care products is expected to grow. GCPL is set to
benefit from the increase in demand for personal care products, which
represents about 22% of the FMCG industry.
• Increasing Spending Power:
With a rise in buying power and improving lifestyles, the personal care
sector is projected to develop. There would be positive effect on personal
care industry due to rise in demand of personal care goods.

• Social Media Marketing:

Social Media Marketing and Online Marketing is creating good
opportunities for the company.

• Acquisition of companies:
GCPL is accelerating its growth by acquiring global and local companies.
This helps the company’s business penetration.
4. Threats
• The abundance of counterfeit products:

The presence of counterfeit products affects the image of a brand and

also affects revenues of a company. In India, counterfeit products affect
a major portion of the FMCG industry sales.

• Competition from unbranded products:

Indian rural market still has the abundance of unbranded products
available, for instance cooking oil and washing soap etc. The presence
of such products affects the industry.
• FDI in retail:
The demand for FDI in retail can affect the company’s position in the
market as it will allow the more international company to enter the Indian
market and thus it is a threat to the industry.

• Macro Economic Factors:

Because of the volatile world financial markets, GCPL is exposed to
volatile international macro-economic indicators.

• Changing Prices:
Changing Prices by competitors can be a major threat to the company.