Marico sees second quarter revenue growth in his 20s

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The FMCG company said it expects modest growth in its second quarter results.

Marico said that during the quarter ended September 2021, the FMCG sector saw improving demand trends as mobility levels increased with the reduction in COVID infections and the acceleration of vaccination campaigns. Discretionary categories and out-of-home consumption have also visibly recovered.

Revenue growth in the quarter was in its twenties, with volume growth close to double digits on a 2-year CAGR basis, he added.

International business saw double-digit growth in constant currencies as the company saw positive trends in all markets except Vietnam which was plagued by a severe COVID surge and lockdown restrictions strict.

Among the main inputs, copra prices corrected further, crude remained firm, while edible oil prices hovered at higher levels. Gross margin is expected to improve slightly from the previous quarter, but will be under pressure year over year due to much higher input costs over the past year.

“The operating margin is also expected to contract year over year given the arithmetic effect of significant price growth in revenue,” said Marico. As a result, the company expects modest earnings growth in the quarter.

The company said it maintains its aspiration to generate sustainable and profitable volume-driven growth over the medium term, enabled by strengthening the brand value of its core franchises and new growth drivers reaching critical mass.

On a consolidated basis, Marico’s net profit decreased 6.56% to Rs 356 crore on a 31.17% increase in net sales to Rs 2,525 crore in the first quarter of June 2021 compared to the first quarter of June 2020 .

Marico is one of India’s leading consumer product companies in the global beauty and wellness space.

Marico shares rose 1.85% to Rs 568.20. The stock has reached a high of Rs 568.75 and a low of Rs 560.80 so far.

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(This story was not edited by Business Standard staff and is auto-generated from a syndicated feed.)

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