At a glance:
Gillette India has shaved costs, trimmed inefficiencies, and smoothened its profit trajectory over the last 5 years — delivering one of the most elite ROEs in FMCG land. But with a P/E of 62.7 and sales growth that moves slower than a No Shave November pledge, investors are asking: How much closer can this razor cut to perfection?
1. 🧾 About the Company
Gillette India Ltd (NSE: GILLETTE) is a P&G powerhouse, with brands like Gillette, Venus, Oral-B, and Braun. It operates in the grooming and oral care segment — but make no mistake, it’s basically a razor+brush duopoly wrapped in dividend yield and pricing power.
📦 Core Products:
- Razors, blades, shaving gel, cream, aftershave
- Toothbrushes (Oral-B), electric grooming (Braun)
🎯 Sales Channels: Modern trade, e-comm, pharmacies, kiranas, and salons.
2. 👑 Key Financial Metrics (FY21–FY25)
| ₹ in Crores | FY21 | FY22 | FY23 | FY24 | FY25 (TTM) |
|---|---|---|---|---|---|
| Revenue | 1,982 | 2,256 | 2,477 | 2,633 | 2,880 |
| Operating Profit | 460 | 483 | 540 | 634 | 774 |
| OPM (%) | 23% | 21% | 22% | 24% | 27% |
| Net Profit | 310 | 289 | 356 | 412 | 534 |
| ROCE (%) | 51% | 51% | 52% | 59% | 59% |
| ROE (%) | 36% | 36% | 38% | 42% | 42.5% |
🔥 FY25 TTM PAT up 40% and OPM nearing 30%. This is what a monopoly looks like — with a blade so sharp it cuts through inflation.
3. 💸 Quarterly Trends: Smooth as a Mach 3 Glide
| Quarter | Revenue (₹ Cr) | OPM % | Net Profit (₹ Cr) |
|---|---|---|---|
| Mar ’24 | 681 | 24% | 99 |
| Jun ’24 | 645 | 27% | 116 |
| Sep ’24 | 782 | 24% | 133 |
| Dec ’24 | 686 | 27% | 126 |
| Mar ’25 | 767 | 29% | 159 |
📈 Every quarter in FY25 had profits over ₹100 Cr — the strongest run in Gillette India’s history.
4. 📊 Shareholder Returns & Dividend
- 💰 Dividend (FY25): ₹47/share
- 📈 3Y Stock CAGR: 28%
- 🏦 Dividend Payout: 100%+ for 2 years straight
- 🪙 Return on Equity: 42.5% — elite, top 1% in FMCG India
This stock is a tax-efficient cash machine for long-term investors. No debt. Clean books. Pure efficiency.
5. 💼 Balance Sheet (As of Dec 2024)
| Metric | Value (₹ Cr) |
|---|---|
| Equity Capital | 33 |
| Reserves | 1,052 |
| Borrowings | 0 |
| Fixed Assets | 344 |
| Cash from Ops (FY24) | ₹509 Cr |
| Capex (FY24) | ₹49 Cr |
✅ No debt, no drama
✅ Operating cash flow exceeds net profit — quality earnings
⚠️ Slight dip in reserves due to high dividend payout
6. 🧮 EduInvesting Fair Value Estimate (FV Range)
Assumptions:
- FY26 PAT Estimate: ₹600 Cr
- PE Multiple (fair for FMCG with 40% ROE): 50x
- Equity Value: ₹30,000 Cr to ₹33,000 Cr
➡️ Fair Value Range: ₹9,000–₹10,500
📍 CMP: ₹10,264 (As of June 12, 2025)
🎯 Verdict: Stock is fairly valued at upper band, not overpriced — but no room for earnings miss.
7. 🪒 Why Gillette Stands Out
✅ Monopolistic control in razors and blades
✅ High pricing power with low ad spends (brand already etched in memory)
✅ No working capital headaches: Negative cash conversion cycle
✅ No inventory overhangs — blades don’t expire, and everyone grows hair.
8. 🧠 EduInvesting Take
Gillette India is like that upper-class uncle with perfect hair and a dividend-paying Demat account — boring, reliable, and annoyingly flawless.
For those seeking:
- 💵 Consistent cashflows
- 🛡️ Moat-based business with minimal disruption risk
- 📈 Slow but steady compounding with elite governance
This is as blue-chip as FMCG gets. The only red flag? Growth. If the grooming market matures or male-beard fashion comes back, Gillette’s runway shrinks.
9. 🚨 Risks to Watch
- 🐢 Sales CAGR of just 7% over 5 years — slow even for FMCG
- 🤳 Beards & grooming fads could hurt core categories
- 🇮🇳 Urban-focused growth; under-penetration in rural
- 🛍️ Competition from subscription-based razor startups (low, but exists)
- 📉 Valuation doesn’t leave room for quarterly slip-ups
10. 🧼 TL;DR Summary
Gillette is the HDFC Bank of FMCG grooming — elite margins, great returns, and zero thrill.
CMP ₹10,264 is justified — but don’t expect multibagger fireworks unless India suddenly becomes the clean-shaven capital of the world.
It’s a hold-and-snooze stock. You’ll thank it — quietly.
Tags: Gillette India, FY25 Results, ROE Kings of FMCG, Best Dividend Stocks India, Grooming Stocks India, Razor Stocks, P&G India, EduInvesting
Author: Prashant Marathe
Date: 12 June 2025
