Godfrey Phillips Shares Plunge 5% Amid Shock Sale of 24Seven Retail Business | Market News
Godfrey Phillips Stock Declines Following Retail Business Sale Announcement
Last Updated: Sep 04, 2024 | 1:37 PM IST
Shares of Godfrey Phillips dropped by 4.81% on Wednesday, hitting an intraday low of Rs 6,291.60. By 1:22 PM, the shares had stabilized somewhat, trading 3.18% lower at Rs 6,399.30. Meanwhile, the BSE Sensex also declined, down by 0.28% to 82,327.03.
The slide in Godfrey Phillips’ stock is attributed to media reports confirming the company’s decision to sell its retail business, 24Seven, to start-up New Shop. This follows the Delhi High Court’s July ruling allowing the sale. The transaction is expected to finalize by the end of September, with the transition already in progress.
In financial updates, Godfrey Phillips reported a 10.17% drop in consolidated net profit for the June quarter of FY25, standing at Rs 228.6 crore compared to Rs 254.4 crore in Q1FY24. However, the company’s revenue from operations increased by 15.7% YoY, reaching Rs 1,440.8 crore. The total expenses rose by 17.4% to Rs 1,216.5 crore for the same period.
Godfrey Phillips, a key player in India’s FMCG sector and a leading entity in the cigarette market with a 14% share, remains dominant in the tobacco industry, which constituted 93% of its revenue in Q1FY25. Known for brands like Four Square, Red & White, and Cavanders, the company also holds an exclusive manufacturing and distribution agreement with Philip Morris International for Marlboro cigarettes in India.
The international tobacco segment, contributing 23% to revenue, involves producing its own brands and contract-manufactured cigarettes for over 40 countries. The company’s non-tobacco business, now just 7% of its revenue, includes confectionery and products from Ferrero, such as Tic Tac and Kinder Joy, a decline from 16% in FY20.
First Published: Sep 04 2024 | 1:32 PM IST
Original Story https://www.business-standard.com/markets/news/godfrey-phillips-shares-slip-5-on-24seven-retail-business-sale-report-124090400483_1.html
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