Marico posts 19% YoY increase in Q3 ad spends

Marico Ltd has recently released its financial results for the quarter ended 31 December, 2024 and recorded its revenue from operations at Rs 2794 crore, marking a 4.8% QoQ increase corresponding to the quarter ended 30 September 2024.

The advertising and sales promotion expense for the quarter marginally increased by 1% from Rs 290 crore in Q2 FY25 to Rs 293 crore in Q3 FY25. The same figure stood at Rs 246 crore in Q3 of the preceding fiscal, marking a 19% jump.

The international revenue for the conglomerate stood at Rs 693 crore which increased by a slight 1.16%. Similarly, its Indian revenue marked a 6.1% QoQ growth from Rs 1979 crore in Q3 FY24 to Rs 2101 crore in Q3 of the current fiscal.

The Parachute coconut oil, which took up 33% of domestic revenues, saw a 3% volume growth and 15% value growth. Similarly, Saffola Edible Oils with 18% share of domestic revenues saw a low single-digit volume growth but 24% value growth. Value Added Hair Oils (19% of Domestic Revenues) saw a decline of 2% in value growth.

Saffola's range of products like oats, soya chunks, and peanut butter experienced an annualized run rate (ARR) in Q3 close to Rs 1000 crore and a value growth of 31%.

The personal care segment which includes Set Wet, Livon and more recorded an annualised run rate of less than rs 325 crore in Q3. Their digital-first brands like Beardo, Plix, Just Herbs, and Just Herbs had an ARR of Rs 600 crore in the aforementioned quarter. 

The company said, “The FMCG sector continued to exhibit a steady demand sentiment during the quarter. While urban sentiment was stable, rural maintained its relatively stronger momentum. Pricing growth for the sector visibly picked up given the backdrop of rising commodity prices.” 

The conglomerate also revealed the Coconut Oil Franchise holds a 63% market share, out of which Parachute within Coconut Oil holds 55% volume market share. Saffola Oats has 41% and Value Added Hair Oils holds 28% value market share. The post wash Leave-on Serums took up 47% and Hair Gels/Waxes/Creams held 52% volume market share. 

Furthermore, the company expects to maintain double-digit growth momentum in India revenue growth; Aggressive diversification to continue. Bangladesh will maintain double-digit momentum; MENA & South Africa will be scaling up, as per Marico, where broad basing of the business is in progress.

Saugata Gupta, MD & CEO, Marico commented, “We have delivered a considerably resilient performance in this quarter with the highest underlying volume and revenue growth in 13 quarters. The core domestic portfolios have held firm amidst inflationary conditions and witnessed market share and penetration gains, with the accelerated scale-up in Foods and Digital-first brands visibly advancing the diversification agenda. The robust momentum in the overseas business, despite challenging operating conditions in select markets, reinforces our medium-term growth algorithm. While the sharper-than anticipated rise in input costs will have some transient impact on margins in the near term, we remain biased towards driving top quartile volume growth and double-digit revenue growth in the near and medium term.”