Recovery in global business crucial for Godrej Consumer bounceback

Despite P/E ratio being attractive, it is better for investors to wait for pick-up in domestic business

After a dismal show in recent quarters, the stock of Godrej Consumer Products (GCPL) has underperformed the markets and most of its FMCG peers. The GCPL stock has fallen 12 per cent in the last three months, much more than the BSE FMCG index’s 1.7-per-cent decline.

There may be little relief for investors ahead, as GCPL’s overall financial performance is unlikely to improve significantly in the near term on account of its international business, say analysts.

GCPL earns close to 45 per cent of its revenues from foreign markets such as Indonesia, Africa and the US, among others. Higher competitive intensity has