The firm expects moderation in commodity prices to help improve margins in the second half of the year
The firm expects moderation in commodity prices to help improve margins in the second half of the year
Consumer goods major Dabur India on Thursday warned that its operating margin could shrink by about 150-200 basis points year-on-year due to rising inflation during the second quarter, while revenues are likely to grow in the mid-single digits.
“During the quarter, inflation was at peak levels, which impacted gross margins,” Dabur said in a regulatory filing. The toothpaste and packaged juice maker, however, expects margins to improve in the second half of the year on softening commodity prices.
India’s retail inflation rose to 7% in August, following an increase in food prices after a fall of 6.71% in July. Consumer price inflation data for September is expected next Wednesday.
Urban markets were driven by modern trade and e-commerce, which saw double-digit growth, while rural markets saw some liquidity pressure.
India’s revenue is expected to grow in the mid-single digits, but international trade is growing in the double digits.
Dabur’s consolidated revenue grew 8.1% in the June-quarter, with an operating margin of 19.62%.
The company is due to report earnings for the second quarter ended September 26 on October 26.