In the December quarter, Marico reported a low single-digit decline in consolidated revenue on a year-on-year basis, while its operating profit saw low double-digit growth, according to a quarterly update. The maker of Parachute oil anticipates a low single-digit increase in domestic volumes for the same quarter, driven by improved demand for its flagship products, particularly in urban areas.
Marico noted that the fast-moving consumer goods (FMCG) sector exhibited similar demand trends on a sequential basis during the quarter, with urban markets remaining steady and rural markets offering little cheer. Constraints on liquidity and profitability in the general trade channel continued to be a concern for the sector, while alternate channels performed well.
Despite challenges, Marico expressed optimism about gradual growth in consumption trends in the coming year due to improved macroeconomic factors and continued government spending. Towards the end of the December quarter, the company took steps to enhance returns on investment across general trade distribution.
Marico mentioned that it undertook a primary stock correction for its channel partners, resulting in low single-digit volume growth for Parachute Coconut Oil. Saffola oils faced challenges due to a high base and cautious trade sentiment, while value-added hair oils posted low single-digit value growth. The company remained focused on its diversification journey, with foods and premium personal care scaling up well in line with aspirations.
In terms of raw materials, copra and edible oil prices remained low, while crude derivatives saw rates drop, leading to an improvement in gross margin. Marico’s international business delivered mid-single digit constant currency growth.
This update follows Dabur India’s announcement that it had experienced a sequential improvement in demand trends in the December quarter, with expectations of mid-to-high single-digit growth in consolidated revenue.
