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GIVAUDAN

Analysis before buying or selling Givaudan shares

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Find out how to analyze the Swiss Givaudan share price. To carry out these analyses, you must indeed have certain knowledge about this company which we will bring to you in this article. Indeed and through this age dedicated to this stock, you will be able to find stock exchange data and economic data about this company such as its main activities and sources of profits, its main competitors on the market and its recent partnerships. We will also start this review with some information to help you carry out your fundamental analysis of this stock.

Elements to consider before selling or buying Givaudan shares

Analysis N°1

In particular, the strength of demand from emerging economies such as India and China, especially in the fragrance segment with a large disposable income population, will be studied.

Analysis N°2

The demand for high-end products can also fall or rise depending on the global economic situation, so economic cycles should be followed closely.

Analysis N°3

Givaudan's strategic acquisitions, which can significantly increase its market presence, will also be closely monitored.

Analysis N°4

Of course, we will also have to watch out for increasingly aggressive competition from the other major players in this market who are trying to take over Givaudan's leadership position.

Analysis N°5

Finally, Givaudan's ethics regarding the manufacturing of its products in an increasingly ecologically impacted environment is also an element to watch.

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General presentation of Givaudan

Now we would like to tell you a little more about Givaudan and its activities, including the different product lines it develops and markets and its most important sources of profit.

The Givaudan Group is a Swiss biochemical company and, more specifically, the world leader in the flavours and fragrances industry. In order to better understand the activities of this company, it is possible to divide them into different divisions according to the share of sales they generate and in this way:

  • Flavours alone account for more than 54.3% of the Group's sales. They are mainly used in the production of savoury dishes such as ready meals, snacks, soups, sauces, meat and poultry, in the production of beverages such as soft drinks, fruit juices, instant drinks, in the production of dairy products and confectionery.
  • The remaining 45.7% of the group's sales are generated by fragrances for the manufacture of cosmetics and consumer products such as personal care products.

Givaudan currently operates 46 production sites worldwide.

In terms of geographical spread, Givaudan generates only 1.1% of its sales in Switzerland, 27.5% in the rest of Europe, 26.7% in Asia Pacific, 26.1% in North America, 11.4% in South America and 7.2% in Middle East Africa.

Analysis before buying or selling Givaudan shares
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The major competitors of Givaudan

Let's find out who Givaudan's main competitors are around the world because, although Givaudan is the market leader, it faces some tough opponents.

DSM

This Dutch company is active in four main sectors, including nutrition, pharmaceuticals, performance materials and industrial chemicals. It is also listed on the Euronext 100 stock exchange index.

Firmenich

This other Swiss company also specializes in the creation of fragrances and flavors and is number two in this market just behind Givaudan. It is also listed on the SMI.

IFF

International Flavors and Fragrances is a global company specializing in the manufacture of fragrances for the perfume industry and flavors for the food industry. It is the third largest company in this market and is based in New York and listed on the NYSE.

Symrise

This German company is also a major player in the flavour and fragrance production sector and is listed on the MDAX index.

Takasago

Takasago is a Japanese company also specializing in the production of flavors and fragrances.

Sensient

 The last serious competitor of Givaudan is Sensient, a US-based flavour and fragrance company.


The major partners of Givaudan

After Givaudan's opponents, let's find out who its main allies are with some examples of recent partnerships the company has established with other companies.

Bio FD&C

In 2019, Givaudan entered into a strategic partnership with Bio FD&C in the field of plant cell culture and phytopeptides. Bio FD&C is a South Korean company specialised in innovative beauty products and will therefore collaborate with Givaudan's Active Beauty division in order to strengthen its capabilities.

Draco Natural Products

In 2017, the group had also signed a strategic partnership with Draco Natural Products Inc, again through its Active Beauty segment with the aim of expanding its offering with a new exclusive product range that uses the knowledge of traditional Chinese medicine. Within the framework of this collaboration, the two companies worked together on the research and development of active botanical ingredients formulated on the principles of traditional Chinese medicine. These ingredients were then used in the manufacture of topical products to improve the health of the skin and hair.

Synthite

Finally, in 2018n Givaudan had also established a strategic partnership with the Indian company Synthite in the research and development of natural fragrance ingredients.

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Positive factors for Givaudan shares
The factors in favour of a rise in the Givaudan share price:

A good knowledge of Givaudan also includes a good knowledge of its main strengths and weaknesses. For this reason, we will now take a look at the various advantages and disadvantages of this stock:

Let's start by taking a closer look at the strengths of the Givaudan Group and the elements that support and benefit its stock.

  • Firstly, one of Givaudan's greatest strengths is that the company has a very large market share in the fragrance and flavour industry, which gives it leverage with its customers and suppliers.
  • The company's financial strength is also one of its key assets. Indeed, in recent years, the group's results have shown an interesting financial performance and the company's position in its sector is strong.
  • Another strength of the Givaudan group is its international presence. The group has a strong presence in more than 45 countries around the world and currently employs more than 9,000 people.
  • In addition to its core business, the Givaudan group is still one of the largest industrial players worldwide.
  • In the near future, Givaudan can benefit from a presence in emerging markets such as India and China. These two markets represent an important demand for fragrances due to their large population and disposable income.
  • Finally, Givaudan's strategy of acquiring businesses in diversified sectors, most recently Quest International and Nestlé's flavour division IFS, may allow the company to gain global leadership in the fine fragrance and consumer products industry.
Negative factors for Givaudan shares
The factors in favour of a drop in the Givaudan share price:

Let's now review the main weaknesses of this stock with the elements that could hinder Givaudan's future growth and thus decrease its market share.

  • First of all, it is important to recall that the company has recently been subject to a number of lawsuits and litigation related to air pollution problems in its production facilities. These problems have damaged the company's brand image.
  • The group also has other environmental problems such as explosions and spills at the company's Seveso facility, which have led to widespread criticism.
  • Another major weakness of the company is that consumers are changing their habits and taking time to study the market before buying. Their preferences change more often than before, which means that the company's products may be subject to a temporary fashion effect.
  • This also includes counterfeit products offered by some market participants that compete with Givaudan's most popular products.
  • Finally, despite its leading position, Givaudan still faces some large competitors that threaten its market share and may eventually cause the company to lose positions in some strategic markets and segments.

As you can see, the Givaudan group has many strengths to increase its growth in the coming years, but it also faces some major weaknesses that may hold it back and negatively influence its share price. It is therefore essential that you take these elements into account when performing a fundamental analysis of this stock and how they influence the way the company may react to certain events.

The information supplied here is only for indicative purposes and should not be used without the completion of a comprehensive and complete fundamental analysis of this asset notably taking into account exterior data, future publications and announcements and all fundamental events and news that could influence the strengths and weaknesses or make them more or less significant. This information does not in any way constitute recommendations relating to the completion of transactions or a solicitation to buy or sell an asset.

Frequently Asked Questions

Where can I find Givaudan's financial results?

If you want to perform a detailed financial analysis of the Givaudan Group to understand what its future movements in the stock market may be, you can visit the website of this company in the investors' section. Note that as far as the latest balance sheet published by this company is concerned, that is, the balance sheet for the financial year 2019, the group's revenue was CHF 6,203 million and the company's net income was CHF 702 million.

Who owns Givaudan's capital?

The Givaudan Group is 13.9% owned by the Bill & Melinda Gates Foundation Trust, 5.15% by Harris Associates, 5.04% by MFS International, 3.22% by Thornburg Investment Management, 2.78% by The Vanguard Group, 2% by Janus Capital Management, 1.97% by Fidelity Management & Research, 1.90% by Franklin Mutual Advisers, 1.77% by BlackRock Investment Management and 1.72% by UBS Asset Management Switzerland.

How do I make a successful technical analysis of Givaudan?

To perform your technical analysis of the Givaudan share, you must first of all choose your stock chart carefully, favouring customisable charts such as those on online trading platforms. Then use as many trend and volatility indicators as possible in order to detect reliable movements and don't forget to cross-check the signals obtained with those of the fundamental analysis.

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