Marico sees Q3 margins under pressure as input costs rise

Marico sees Q3 margins under pressure as input costs rise

Kolkata: Consumer products maker Marico Ltd sees pressure from rising input costs impacting the firm’s margins in the third quarter of the current fiscal, a top official said.

“The increase in raw material prices varies across categories. For example, for coconut oil, the raw material prices have gone up by 60% (in the current quarter)," Harsh Mariwala, chairman and managing director, told reporters.

The company has increased prices of its flagship hair oil brand ‘Parachute’ by 5% and edible oils prices by 2-3% during the second quarter. It also hiked prices of ‘Parachute´ for the second time by 7-8% at the end of the second quarter.

Copra is a key raw material, accounting for 40% of Marico’s input costs.

Marico, however, expects its revenue growth to pick up during the second half of the fiscal.

“In H1 revenue growth was 13% so in the second half it will definitely be higher than that," Mariwala said.

The firm is also looking for growth, both via organic and inorganic means, and is scouting for acquisitions in geographies such as Indonesia, Vietnam, Kenya and Nigeria, in the personal care space.

At 3.15 p.m., shares of the firm were up 1.55% at 124.35 in a firm Mumbai market.