Emami's Q4FY20 revenue and EBITDA came in 5% and 31% below estimates at Rs5.3bn and Rs1bn, respectively. The domestic business remained weak as most core brands recorded a steep decline. Sales declined 17%, owing to a 19%/4% fall in the domestic/international business. Excluding 7 Oils in One, which grew 5%, the performance across brands was weak, with Boroplus/Male Grooming/Navratna/Healthcare/Kesh King declining 77%/42%/12%/9%/26%. Input prices remain soft, which should continue to drive the gross margin expansion. Management hopes to maintain profitability as higher GM and cost savings (~Rs500mn in FY21) may offset the decline in sales.