Companies

Marico net dips 6% in Q1 at ₹365 crore

Ayushi Kar Mumbai | Updated on July 30, 2021

Saugata Gupta, Managing Director and CEO   -  Businessline

Higher number of Covid caseloads in South, West hits growth in key portfolios

Consumer goods company Marico reported a 6 per cent decline in consolidated profit at ₹365 crore in the first quarter ended June 30 compared to ₹388 crore in the corresponding quarter last year.

Revenue from operations was up 31 per cent to ₹2,525 crore compared to ₹1,925 crore during the period.

Sequentially, Marico reported a 60 per cent jump in consolidated profit compared to ₹227 crore in the March quarter.

EBITDA for the June quarter rose 3 per cent to ₹481 crore (₹467 crore).

Marico began to see the impact of the second wave after late April. However, it did not disrupt its business as much as last year, due to localised lockdowns. Rural growth outpaced urban, albeit it being moderate. Marico remains optimistic that a normal monsoon and continued government stimulus will help. Higher number of caseloads in the South and West also impacted growth in key portfolios, where they enjoy higher salience.

Market share, growth gains

Core portfolios continued to clock market share and growth gains such as Parachute Rigids (up by 80 bps in market share, up by 12 per cent in volumes), value-added hair products (up by 70 bps in market share and 34 per cent in volumes) and the Saffola franchise delivered 24 per cent in volume growth. Marico is confident that its food portfolio still remains on track to achieve ₹500-crore turnover in FY22. Traditional trade grew, with both urban and rural growing 17 per cent in volume terms, e-commerce grew 61 percent and modern trade by 10 per cent. Premium personal care brands recovered from a low base but are still below pre-Covid revenues, due to the discretionary nature of the product. International business saw growth, with Bangladesh clocking 9 per cent constant currency growth, South-East Asia delivering 16 per cent constant currency growth and MENA and South Africa recovering from a low base.

Long term strategies for Marico include premiumisation of the core portfolio, expansion of the food portfolio, accelerating digital transformation and rejuvenating discretionary portfolio.

Saugata Gupta, MD & CEO, said, “We started the year with a healthy quarterly performance especially under the challenging circumstances arising due to the severe second Covid wave in India. We will continue to prioritise volume-driven growth and franchise expansion in the medium term, by focusing on growing and premiumising the core, aggressively scaling up foods, building a portfolio of strong digital-first brands and investing in distribution expansion.”

Published on July 30, 2021

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