Marico expected to post low single-digit Q3 consolidated revenue
2 min read 04 Jan 2023, 06:47 PM ISTMarico noted that FMCG sector witnessed some improvement in demand in the quarter which was more visible in specific categories due to festive fervor and oncoming winter season
PremiumFMCG major Marico on Wednesday said that the firm's consolidated revenue will be in low single digit in the December quarter on a year-on-year basis due to a muted recovery in rural demand amid elevated inflation.
Marico noted that FMCG sector witnessed some improvement in demand in the quarter which was more visible in specific categories due to festive fervour and oncoming winter season.
"Urban and premium categories maintained their steady pace of growth. However, recovery in rural demand was not as discernible as retail inflation stayed at elevated levels," said Marico in its regulatory filing.
In terms of India business, firm said that the Parachute Coconut Oil would post low single-digit volume growth after a visible recovery in December as consumer pricing stabilised with copra prices firming up in the off-season.
"Going forward, we expect the brand to deliver growth in line with medium term aspiration," it said.
Meanwhile, Saffola franchise grew in double digits in value terms with Saffola Oils posting low teen volume growth and Foods continuing its strong run towards the stated revenue aspiration.
The firm said that the value added hair oils had a subdued quarter, which was mainly a reflection of tepid sentiment in rural and mass personal care categories while the premium personal care, on the other hand, witnessed double-digit growth in line with sectoral trends.
"India business marked a slight improvement over the preceding quarter to post a mid-single-digit volume growth," said Marico in filing.
In terms of international business for the quarter continued its healthy growth momentum.
"International business continued its healthy growth momentum with high single-digit constant currency growth, even while contending with implications of currency depreciation and high inflation in key markets," company said.
It added that Bangladesh held steady despite challenging macros, while the other markets performed well and acquisition of female personal care brands, Purité de Prôvence and Ôliv, will provide a fillip to the Vietnam business.
"As we witnessed some semblance of stability in key input prices and consumer pricing across key franchises, gross and operating margins are expected to improve both on a sequential and year-on year basis. In view of the lower revenue growth, we expect a modest growth in operating profit," it said.
"The Company maintains its aspiration of delivering sustainable and profitable volume-led growth over the medium term, enabled by the strengthening brand equity of its core franchises and scaling up new engines of growth," Marico added.
Marico Q2 net profit declined by 3 per cent to ₹301 crore for the three months ended 30 September from ₹309 crore a year earlier.
On Wednesday, the company's scrip was down by 1.03 per cent at ₹505.45 on BSE.
