Fast-Moving Consumer Goods (FMCG) maker, Marico Ltd., is targeting double-digit revenue growth in FY25.
The company is anticipating growth with an uptick in rural demand and increase in its premium personal care, food and digital-first business.
“We are seeing some green shoots in rural growth since March. This quarter, the rural growth has been slightly ahead of the urban growth. With everything in place, the demand scenario should improve. We are driving premiumisation in value-added hair oil, foods, premium personal care and digital. Foods and digital-first brands are expected to grow between 20-25 per cent. With this mix, we believe that we will be able to deliver double-digit revenue growth in FY25” said Pawan Agrawal, Chief Financial Officer of Marico Ltd. to businessline.
Strategic acquisitions
The company’s share of foods and premium personal care was 20 per cent of domestic revenues in FY24. Further, Marico is aiming to grow its food business at 20 per cent + compound annual growth rate (CAGR) and scale it to 2 times of the current scale in FY27.
“Excluding acquisitions, the core foods business has become 3 times in the last four years. This has been a strong scale and we should be able to double the food business by FY27, which is roughly around ₹700 crore at this time. We do not rule out possibilities of acquisitions, but we believe through organic and inorganic opportunities we would scale in the next few years,” said Pawan Agrawal.
To expand its direct reach in general trade, Marico will be making investments of up to ₹100 crore, “We will be investing ₹80-100 crore in the next three years to increase our direct reach from 1 million to 1.5 million outlets. This will improve growth in general trade which has been a challenge in the last few years due to significant growth in alternate channels,” he said.
Parachute Rigids prices
Marico has undertaken a 6 per cent price increase in Parachute Rigids due to the increase in copra prices.
“As of now, we have taken a six per cent increase in Parachute in response to the inflation we have seen so far. We want to maximise the volume growth and optimise the margin and will continue to follow that principle but if prices go up further,we might take another round of price increase,” added Pawan Agrawal.