During the quarter, underlying volume growth in the India business remained in high single digits, while marking a slight improvement on a sequential basis
Emphasising that the sector witnessed steady demand trends during the quarter, consumer products firm Marico is expecting operating profit growth to touch double digits on a year-on-year basis in the third quarter of the current financial year.
Sharing the business update in a regulatory filing, the company noted that consolidated revenue growth on a year-on-year basis stood in the high twenties, poised to achieve its full year aspiration. During the quarter, underlying volume growth in the India business remained in high single digits, while marking a slight improvement on a sequential basis. Parachute continued to demonstrate stellar resilience amid elevated input cost and pricing conditions.
The brand recorded a marginal volume decline but was in positive territory. Saffola oils had a muted quarter, while value added hair oils grew in the twenties, reinforcing sustained traction in the franchise.
“We expect to maintain the double-digit growth momentum in this franchise over the near and medium term, supported by the strategic focus in the mid and premium segments of the portfolio, enhanced direct reach driven by project Setu and the recent goods and services tax (GST) rate rationalisation,” the company pointed out.
The company noted that foods category had a benign quarter and is expected to revert to accelerated growth over the next two quarters, while premium personal care (including digital-first brands) continued to scale ahead of aspirations. The international business maintained its robust momentum with constant currency growth in the early twenties, as Bangladesh led from the front, while Vietnam and South Africa bounced back to double-digit growth on the back of targeted initiatives.
“We expect an uptick in gross margin on a sequential basis, after bottoming out in the preceding quarter. We anticipate further gross margin improvement in the coming quarters, driven by the lagged pass-through of lower copra costs. We sustained brand-building investments to continually strengthen the long-term equity of our franchises and drive accelerated portfolio diversification,” it emphasised.
Among key inputs, copra prices have corrected around 30 per cent from the highs and are expected to exhibit a downward bias in the months ahead, followed by the flush season. Vegetable oil prices remained at elevated levels, while crude oil derivatives were benign, the official statement added.
