Bajaj Consumer Care Analysis

dividend

Pros

• Dividends after 3 years are expected to be covered by earnings (1.3x coverage).
• Bajaj Consumer Care's pays a higher dividend yield than the bottom 25% of dividend payers in India (0.76%).
• Bajaj Consumer Care's dividend is above the markets top 25% of dividend payers in India (3.08%).

Cons

• Dividend payments have increased, but Bajaj Consumer Care only paid a dividend in the past 9 years.
• Dividends paid are not well covered by earnings (1.1x coverage).
• Whilst dividend payments have been stable, Bajaj Consumer Care has been paying a dividend for less than 10 years.

future

Pros

• Bajaj Consumer Care's earnings growth is expected to exceed the low risk savings rate of 7.2%.
• Bajaj Consumer Care is expected to make outstanding use of shareholders’ funds in the future (Return on Equity greater than 40%).
• Performance (ROE) is expected to be above the current IN Personal Products industry average.
• An improvement in Bajaj Consumer Care's performance (ROE) is expected over the next 3 years.
• Bajaj Consumer Care's revenue growth is expected to exceed the India market average.

Cons

• Cash flow for Bajaj Consumer Care is expected to increase but not above the 50% threshold in 2 years time.
• Bajaj Consumer Care's earnings are expected to grow by 7.4% yearly, however this is not considered high growth (20% yearly).
• Bajaj Consumer Care's earnings growth is positive but not above the India market average.
• Bajaj Consumer Care's earnings are expected to increase but not above the low risk growth rate next year.
• Bajaj Consumer Care's net income is expected to increase but not above the 50% threshold in 2 years time.
• Bajaj Consumer Care's revenue is expected to increase but not above the 50% threshold in 2 years time.
• Bajaj Consumer Care's revenue is expected to grow by 7.6% yearly, however this is not considered high growth (20% yearly).

health

Pros

• Bajaj Consumer Care is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
• Bajaj Consumer Care is profitable, therefore cash runway is not a concern.
• Bajaj Consumer Care is profitable, therefore cash runway is not a concern.
• Debt is well covered by operating cash flow (257.1%, greater than 20% of total debt).
• Debt is covered by short term assets, assets are 8.2x debt.
• Bajaj Consumer Care's cash and other short term assets cover its long term commitments.
• Bajaj Consumer Care earns more interest than it pays, coverage of interest payments is not a concern.
• Bajaj Consumer Care's level of debt (11.8%) compared to net worth is satisfactory (less than 40%).

Cons

• High level of physical assets or inventory.

management

Pros

• The average tenure for the Bajaj Consumer Care board of directors is over 10 years, this suggests they are a seasoned and experienced board.
• The tenure for the Bajaj Consumer Care management team is about average.

Cons

past

Pros

• Bajaj Consumer Care's year on year earnings growth rate has been positive over the past 5 years.
• Bajaj Consumer Care used its assets more efficiently than the IN Personal Products industry average last year based on Return on Assets.
• Bajaj Consumer Care has efficiently used shareholders’ funds last year (Return on Equity greater than 20%).

Cons

• Bajaj Consumer Care's 1-year earnings growth is less than its 5-year average (1.1% vs 4.7%)
• Bajaj Consumer Care's use of capital deteriorated last year versus 3 years ago (Return on Capital Employed).
• Bajaj Consumer Care's earnings growth has not exceeded the IN Personal Products industry average in the past year (1.1% vs 1.1%).

value

Pros

• Bajaj Consumer Care is good value based on earnings compared to the IN Personal Products industry average.
• Bajaj Consumer Care is good value based on earnings compared to the India market.
• NSEI:BAJAJCON is up 8.3% outperforming the Personal Products industry which returned 3.7% over the past month.
• NSEI:BAJAJCON is up 8.3% along with the India market (8%) over the past month.

Cons

• Bajaj Consumer Care's share price is below the future cash flow value, but not at a moderate discount (< 20%).
• Bajaj Consumer Care's share price is below the future cash flow value, but not at a substantial discount (< 40%).
• Bajaj Consumer Care is overvalued based on assets compared to the IN Personal Products industry average.
• Bajaj Consumer Care is poor value based on expected growth next year.
• BAJAJCON underperformed the Personal Products industry which returned -5.3% over the past year.
• BAJAJCON underperformed the Market in India which returned -14.5% over the past year.