Godrej Consumer vs Tata Consumer
Godrej Consumer vs Tata Consumer: With increasing disposable income and population exceeding 1.4 billion, the FMCG sector has tremendous potential to grow in India. Additionally, the expansion of urban areas is increasing the demand for packaged consumer foods. In this article, we will look at two companies currently active. FMCG segment with good performance and larger market share. Let us compare Godrej Consumer and Tata Consumer. Read on to find out more.
Godrej Consumer vs Tata Consumer – Company Overview
Godrej Consumer
Godrej Consumer We have been in this business for the past 125 years. The company has remained competitive in the industry through innovation. Godrej Consumer is present in over 85 countries. It serves a massive consumer base of 1.2 billion. Godrej Consumer has a larger presence in the continents of Asia, Africa and Latin America.
Take a look at the most important past moments that helped them grow and increase their presence. In 1994, Godrej Consumer acquired the Goodknight business by paying INR 100 Crores. In late 2010, Godrej Consumer paid INR 124 billion to acquire 51% stake in Sara Lee.
The company owns most of the brands such as Goodnight, Aer, HIT, Cinthol, Ezee, Nupur, Park Avenue, and Kama Sutra.
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Tata Consumer Ltd.
Tata Consumer Ltd. It is one of the major companies of the Tata Group. Tata Consumer is the second largest car company globally. Simply put, Tata Consumer is an integrated F&B company that is expanding its market share globally in the FMCG segment.
Tata Consumer is a large company with over 3,500 employees. And through 3.9 million retail stores, we can reach over 200 million households in India. Tata Consumer believes in continuing to innovate to further strengthen and accelerate its core business. Tata Consumer continuously innovates and adds products across its portfolio.
Tata Consumer also acquired Organic India, giving it an opportunity to become a major player in the herbal and traditional supplements segment. Tata consumer-owned brands include Tata tea, Tetley, Tata salt, Himalayan, Smith and Jones, Chings and Tata Coffee.
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Industry Overview
India is a growing country in food processing with a market size of over $307.2 billion. And it is expected to exceed $547.3 billion by 2028, at a compound annual growth rate (CAGR) of 9.5% from 2023 to 2028. The Indian government is supporting the FMCG industry on a larger scale to help companies reduce set-up costs.
Companies under FMCG have benefited greatly from the advent of e-commerce as they have been able to reach out to a wider audience without having to invest much in marketing activities.
The industry is receiving greater support in terms of preferential policies. Under the Union Budget, $976 million has been allocated with the aim of reducing import costs and improving domestic competitiveness.
Godrej Consumer Vs Tata Consumer – Finance
Sales and Net Profit
Godrej Consumer’s income statement shows year-on-year (YOY) growth in operating revenue. Revenues increased from $1227.6 billion in fiscal 2022 to $1331.6 billion in fiscal 2023. This resulted in revenue growth of 8.47%.
Tata Consumer’s income statement shows an increase in revenue value from ₹12,425 crores in FY 2022 to ₹13,783 crores in FY 2023. This is a year-on-year (YOY) growth of 10.93%.
The table below shows the revenue from the company’s operations.
Godrej Consumer’s corporate net profit increased to ₹1,785 crores from ₹1,702 crores in FY 2022, taking into account TTM.
The company’s net profit increased from ₹1015 crores in FY 2022 to ₹1320 crores in FY 2023.
Overall, Tata Consumer has been able to perform better compared to Godrej Consumer in terms of operating revenue growth.
The table below shows the company’s net profit.
profit
Godrej’s operating margin (OPM) was 17.43% in FY2023 as against 18.55% in FY22. On the other hand, Tata Consumer’s operating margin was 12.31% compared to 12.30% in FY22. .
Godrej’s Net Profit Margin (NPM) was 12.79% in FY2023 as against 14.53% in FY22. On the other hand, Tata Consumer’s net profit margin was 8.77% compared to 8.68% in FY22.
Godrej’s operating margin and net profit margin have declined year-on-year, while Tata Consumers have remained consistent without any decline.
The table below compares the operating profit margin (OPM) of each company.
The table below compares the net profit margins (NPM) of companies.
rate of return
Godrej Consumer’s return on equity (ROE) for fiscal 2023 is 13.43%. Fiscal 2023 return on invested capital (ROCE) is 16.35%.
The three-year average ROE (return on equity) is 16.76% and ROCE (return on invested capital) is 17.96%.
Tata Consumer’s return on equity (ROE) in 2023 is 7.70%. Fiscal 2023 return on invested capital (ROCE) is 9.70%.
The three-year average ROE (return on equity) is 7.33% and ROCE (return on invested capital) is 9.17%.
The table below compares companies’ return on equity.
The table below compares the companies’ return on capital.
leverage ratio
Godrej Consumer’s debt to equity ratio is low at 0.11 for FY23. The company’s debt appears to have decreased from 0.17 in fiscal 2022 to 0.11 in fiscal 2023.
The interest coverage ratio is 12.32 times as of fiscal year 2023, and the average interest coverage ratio over the three years was 15.69 times.
Tata Consumer’s debt ratio is as low as 0.10 in 2023. The interest coverage ratio is 19.47 times as of 2023. The average interest coverage ratio for three years was 20.19 times.
Overall, Tata consumers appear to have low debt and safe interest coverage ratios.
The table below shows the debt ratio of each company.
The table below shows the interest coverage ratio for each company.
Godrej Consumer Vs Tata Consumer – Key Indicators
Godrej Consumer vs Tata Consumer – Future Planning
Godrej Consumer
- Godrej Consumer is focused on scaling up household pesticides in Indonesia and ensuring better performance and growth.
- Godrej Consumer continuously invests in research and development (R&D) to achieve more innovations.
tata consumer
- Tata Consumer plans to increase awareness and expand into the South Indian region by selling tea, coffee, salt, and spices preferred by South Indians.
- Tata Consumer is all set to launch 200 large new products every year.
- Tata Consumer is investing more in research and development to launch new and innovative products, part of which is the launch of Tata Coffee Gold – 100% freeze-dried coffee.
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conclusion
Coming to the conclusion of the article, Godrej Consumers vs Tata Consumers, to give a brief overview of the article, we have compared the company overview, industry overview, company fundamentals and discussed the future prospects of each company at the end. Please comment your thoughts in the comments section below.
Written by Nishanth P
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