Marico Q3 Results: Profit rises 4% YoY to ₹399 crore, revenue up 15%; interim dividend declared | Stock Market News

Marico Q3 Results: Marico, a leading player in India’s consumer products sector with a focus on hair and wellness, announced its December quarter results today, January 31, reporting figures in line with street estimates. The healthy performance was primarily driven by strong growth in the domestic business, fueled by both price hikes and increased volumes.

The company reported volume growth of 6% in its India business, which was higher than the analyst estimates of 5%. It also reported a constant currency growth of 16% in the international business.

Consolidated and domestic revenue growth, as well as underlying volume growth in the India business, reached a 13-quarter high. Domestic revenue was ₹2,101 crore in Q3, up 17% year-on-year (YoY), led by price hikes in core portfolios in response to the sharp rise in input costs.

Overall, the company reported a double-digit revenue growth, which stood at ₹2,794 crore in Q3, compared to ₹2,422 crore posted in the same period last year, marking a 15% improvement.

Among channels, MT and E-commerce (including Quick Commerce) continued to lead with high double-digit volume growth, while GT remained flat, according to the company’s earnings filing.

However, gross margin contracted by 180 basis points YoY, primarily impacted by the rising trend in copra and vegetable oil prices, which was only partly offset by pricing interventions in key portfolios.

Its advertising and promotion (A&P) expenditures increased by 19% YoY, aligning with the company’s strategic focus to strengthen its franchises and drive diversification. As a result, despite a 4% increase in EBITDA, the EBITDA margin stood at 19.1%, down 210 basis points compared to the previous year.

On the other hand, the volume for Parachute Coconut Oil, which contributes 33% to the company’s domestic revenue, grew by 3% in Q3. The brand recorded a 15% revenue growth, driven by pricing hikes implemented earlier this year. Another price increase of approximately 5% was introduced towards the end of this quarter, as per the company’s Q3 earnings filing.

The net profit for the reporting quarter came in at ₹399 crore, an increase of 4% compared to a net profit of ₹383 crore in Q3FY24.

Meanwhile, the company declared an interim dividend of ₹3.50 per share on its paid-up equity share capital of ₹129.5 crore.

Strategic focus on core categories

The FMCG sector has exhibited steady demand trends over the course of this year, supported by a recovery in rural sentiment and stable urban consumption. Retail inflation eased in December due to moderating food prices but remains at relatively elevated levels. The company expects supportive government schemes and a healthy crop season to aid consumption in the coming quarters. Measures to stimulate consumption are anticipated in the forthcoming Union Budget

Amidst the stable macro backdrop, Marico anticipates gradually improving growth trends in the core categories of its domestic business through ongoing initiatives to support select General Trade (GT) channel partners and transformative expansion of its direct reach footprint under Project SETU.

In the medium term, the company aims to deliver double-digit revenue growth through consistent outperformance vis-a-vis the category and market share gains in the domestic core portfolios, accelerated growth in the Foods and Premium. Personal Care and double-digit constant currency growth in the international business.

The company is also expecting operating margin to inch up over the medium term with leverage benefits as well as premiumisation of the portfolios across both the domestic and international businesses.

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