Companies

Marico clocks 14% rise in Q4 net profit at ₹227 crore

Our Bureau Mumbai | Updated on April 30, 2021

Saugata Gupta, MD and CEO   -  Businessline

India business delivers highest-ever quarterly volume growth of 25%

Marico Limited on Friday posted a consolidated net profit of ₹227 crore in the fourth quarter ended March 31, a 14.07 per cent increase over the fourth quarter of FY20. It had posted a consolidated net profit of ₹199 crore in the corresponding quarter of the previous fiscal.

Marico’s India business delivered its highest-ever quarterly volume growth of 25 per cent, the company said in a statement.

The total income during the fourth quarter stood at ₹2,041 crore, a 33.57 per cent increase compared to the year-ago quarter’s ₹1,528 crore.

Revenue from operations grew 34 per cent to ₹2,012 crore backed by robust volume growth of 25 per cent in the domestic business and constant currency growth of 23 per cent in the international business, the company said.

Biz to remain resilient

“With the pandemic in India taking a severe turn, the year has ended on a rather sombre note… It is the tremendous grit and fighting spirit of our people that has allowed both the domestic and international businesses to rebound impactfully on a year-on year basis. We expect the India business to remain resilient amidst uncertainty in the near term and see through the transient spike in input costs, while the stability in the international business is also reassuring,” said Saugata Gupta, MD & CEO, Marico.

“Over the medium term, the company will continue to prioritise maintaining volume-driven growth momentum and franchise expansion even in times of temporary cost pressures by focusing on growing the core, aggressive foods diversification, executional excellence and investment behind capability and brand building,” Gupta added.

Marico’s international business posted broad-based growth of 23 per cent in the fourth quarter in constant currency terms.

Marico witnessed strong momentum in each of the core portfolios of the India business while steadily strengthening its play in foods through innovation, the company said. “Rural continued to lead the way in traditional trade, growing at 1.8x of urban. Ecom (now eight per cent of domestic business) and CSD also fared well, while modern trade dipped due to pantry loading in the base quarter,” it added.

Input cost pressure

Gross margin was down 517 bps owing to the severe input cost pressure, as pricing interventions in the core portfolios were not commensurate to the inflation, it said.

Advertising and sales promotion grew 35 per cent YoY as the company invested aggressively mainly on core franchises and the foods innovations, the company further stated.

Marico holds its medium-term aspiration of delivering 8-10 per cent domestic volume growth and 13-15 per cent revenue growth. The company would be comfortable maintaining its threshold operating margin of 19 per cent plus over the medium term, it added.

Published on April 30, 2021

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