Colgate-Palmolive (NYSE:CL) (India) has reported a 2% surge in its shares to Rs 2,073.25 ($1 = Rs 83.25) on the National Stock Exchange (NSE) as of Monday, even after the company disclosed receiving a Rs 170 crore (Rs 1 crore = $120,127) transfer pricing order from the Income Tax Department for the fiscal year 2021-22. The order disallowed certain international transactions between related entities where prices differed from those among unrelated parties, necessitating price adjustments.
Despite this development, the company has stated that the order will not affect its operations and plans to engage with the Dispute Resolution Panel following further proceedings. The company is currently awaiting the conclusion of draft assessment proceedings before taking this next step.
This news follows Colgate-Palmolive's recent financial report for Q2FY24, which showed robust growth. The company reported a year-on-year net profit of Rs 340.05 crore, an increase of 22.31%, and revenue of Rs 1,462.38 crore, up by 6.09%. Additionally, EBITDA rose from Rs 408 crore in Q2FY23 to Rs 482.2 crore, marking a margin of 32.8%.
Despite the order from the Income Tax Department, Colgate-Palmolive's stock experienced only a minor fall of 0.92% on Monday. The company maintains that there will be no financial or operational disruptions due to this order.
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