Edelweiss Securities has maintained 'Hold' on Colgate Palmolive with target price of Rs 2,204 as against current market price (CMP) of Rs 2,074 in its report.

Commenting on the investment rationale, Edelweisse Securities said, ''Colgate Palmolive's (Colgate) Q4FY15 revenue and PAT were in line with our estimates. Key positives include (i) Colgate's toothpaste volume growth at 5% YoY continues to outpace overall toothpaste category (declined 2.3% YoY in Q4FY15);  (ii) 19-quarter high gross margin at 63.7% (up 312bps YoY) led by premiumisation, soft commodity prices and prudent cost controls; and (iii) 12-quarter high EBITDA margin driven by lower A&P spends (prompted by lacklustre performance by P&G's oral care- Rs 176 million loss in Q4FY15).

We believe P&G's focus on profits in India (in detergents, P&G's products are ~15% more expensive than HUL's) and muted response to toothpaste augur well for Colgate. We expect Colgate to potentially benefit from anticipated recovery in urban demand and strong innovation pipeline. Maintain 'HOLD/Sector Performer.''

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