Dabur India net profit up 2% in December quarter

Manufacturer of Real Fruit Drinks and Vatika Hair Oil reports 7.8% growth in consolidated revenue from operations 2,941.75 crore, up from 2,728.84 crore in the year-ago period.

Dabur’s net profit was overestimated by Bloomberg estimates 503.75 crore with consolidated sales of 2,948.47 crores.

Expenses rose 7.6% to Rs 2,388.53 crore during the quarter, the company said in a filing to the exchanges.

Dabur India Chief Executive Officer Mohit Malhotra said the overall operating environment remained challenging throughout the quarter with unprecedented inflation of 13% and weak consumer sentiments.

The company partially mitigated the effects of inflation through calibrated price increases and cost-savings initiatives.

“Despite these macro-economic headwinds, we remain focused on driving our consumer-centric innovation, which has expanded our total addressable market, in addition to achieving market share in 100% of our product portfolio, which is unprecedented. Our investments in distribution footprint expansion in rural India helped accelerate growth even in a challenging environment, with rural demand exceeding Dabur’s urban demand by 500 bps,” Malhotra said.

Malhotra pointed to a “marked revival” in discretionary spending by consumers. This helped the company’s home and personal care business, which grew 8.4% year-over-year during the quarter. Shampoos grew 21.2% during the quarter, while oral care brands reported 6.7. % Development.

However, lackluster demand for health supplements, which grew in the months following COVID, dragged down growth for the company’s healthcare portfolio. Dabur Chyawanprash and Dabur Honey posted sluggish growth in the December quarter, the company said in its earnings presentation. The overall health supplement business was down 8.3% during the quarter.

Meanwhile, the company’s food and beverage business grew 38% year-over-year.

Dabur’s food business under the Homemade brand with a range of ready-to-eat and ready-to-cook products will become 100 crore business by the end of the 2021-22 financial year,” Malhotra said.

Dabur’s stake in the Chyawanprash category rose 200 bps to 63.6%. In Honey Bazaar, Dabur reported a market share of 180 bps.

During the quarter, the company’s advertising and promotional spend was down 16% year-over-year. The company’s EBITDA grew 10.6% year-over-year, while operating revenue grew 9.3%.

Dabur’s international business grew 8.7% year-on-year in constant currency terms.

Analysts tracking the company say Dabur India has reported good results. “The company has hiked prices to pass on the increased commodity inflation. We believe the bulk of the growth is contributed by pricing. It is also important to note that the base quarter sales growth was higher due to higher growth in natural, health supplements and ayurveda products, analysts at ICICI Securities said in a note on Wednesday.

However, gross margin for the company has come down by 200 bps and crude-based packaging costs remain high. However, unlike other FMCG companies, Dabur is least affected by commodity inflation, as the bulk of its raw materials are herbs and agro-based commodities, where inflation is not as high as in crude or palm oil, analysts said. he said.

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