UBS downgrades Colgate citing higher valuations

Colgate has risen 27.7% since the close of Sept 2012

UBS downgrades Colgate Palmolive India Ltd to "neutral" from "buy", saying the stock has well outperformed the consumer sector since October 1, 2012.

However, UBS says it remains a believer in Colgate, raising its target price to Rs 1,720 from Rs 1,600.

"Colgate India is one of the most fundamentally sound companies in the consumer space, and that its brand strength and competitive management will continue to drive growth and margin expansion," UBS says in a note dated Thursday.

Colgate has risen 27.7% since the close of September 2012 compared with the BSE FMCG index's 5.5% rise in the same period.

Colgate shares fell 1.1% to Rs 1,524.75.