Marico sees double volume growth in India biz, posts 9% revenue growth YoY in Q2FY21
The company saw an 8% revenue contribution from E-Commerce alone in the quarter
Marico has released its earnings report for Q2FY21. The company reported a 9% YOY revenue growth to Rs 1,989 crores (USD 270 million) from Operations in this quarter, with underlying domestic volume growth of 11% and a constant currency growth of 7% in the international business. With improving consumer sentiment and supply chain operations at near pre-COVID levels, the majority of the Company’s portfolio came back to healthy growth on a year-on-year basis.
Here is the full statement:
Input costs witnessed inflationary trend, however, the impact was contained through aggressive cost-saving initiatives thereby enabling an improvement of EBITDA margins to 19.6%. As a result, EBITDA and like-to-like PAT grew by 10% and 15% respectively. Reported PAT was up 7% after accounting for a one-time exceptional item (post tax impact of INR 21 crores).
Overall, Advertising & Sales Promotion spend was back to pre-COVID levels at 9.5% of sales, as the Company remained invested behind brand building in relevant categories. Traditional channels continued to outperform with rural growing ahead of urban, while in the newage channels, strong acceleration continued in E-Commerce. Modern Trade remained subdued and CSD continued to witness steep decline. Saffola Honey, launched in the previous quarter, garnered 8% market share in Modern Trade within three months of its launch.
The Company launched proprietary Ayurvedic recipes inspired by the traditional recipe of “Kadha” and “Haldi Doodh” with the launch of the Saffola ImmuniVeda range in select channels of Modern Trade and E-Commerce. To further strengthen its play in immunity-boosting products category, the Company forayed into the chyawanprash segment with the launch of Saffola Arogyam Chyawan Amrut – an enhanced version of traditional chyawanprash with added ingredients of Ayush Kwath herbs, Ashwagandha, Turmeric, Giloy and Amla.
The product will be gradually scaled up across channels. With lockdown restrictions having significantly eased across the country, the Company will strive to sustain the momentum and aim to deliver an 8-10% volume growth in the balance part of the year. The Company expects operating margins to be 20% plus for FY21.
Over the medium term, the Company shall endeavor to deliver an 8-10% growth, growing the core franchises and scaling up the Foods business. With focus on gaining and defending market share, we expect to maintain threshold operating margin of 19% over the medium term.
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