Godrej Consumer, Dabur, Marico post healthy Q4 profits
NEW DELHI: Homebred packaged consumer products makers Godrej Consumer Products, Dabur and MaricoBSE 1.12 % on Tuesday reported healthy results for the quarter ended March despite a slowdown in consumer spending on non-essential items, and said they expected strong growth this quarter on predictions of a normal monsoon. Analysts expressed surprise that there was no sign of slowdown in the company results.
"What's been surprising in the fourth quarter is that numbers reflect no visible signs of slowdown as far as consumption of essential items is concerned, as consumer goods companies have focused on volumes,"Shirish Pardeshi, co-head, research, at brokerage firm Anand Rathi Financial Services, said. "With a normal monsoon prediction, volume growth should continue with momentum," he added. Boosted by doubling of its rural reach over the past 18 months, Dabur India reported its highest volume growth in 11 quarters at 12%.
The maker of Fem bleach and Vatika shampoo posted 17.6% year-on-year increase in its net profit at Rs200.55 crore for the fourth quarter, up from Rs170.51 crore a year earlier. Net sales of the company rose to Rs1,531.09 crore for the fourth quarter, 12% more thanRs1,363.58 crore a year earlier, Dabur India said in a statement.
Company CEO Sunil Duggal partly attributed the rise in profits to higher advertising spends at 13%, about 1.5% higher than the previous year. Rival Godrej Consumer Products reported 73.5% jump in its consolidated net profit for the fourth quarter at Rs334 crore, largely helped by a one-time exceptional gain of Rs129 crore from the sale of its Indonesian arm's foods business. Excluding the gain, the net profit stood at Rs205 crore, just about 6% more than the yearago net profit of Rs192.64 crore. This despite a 29% jump in net sales at Rs1,715.51 crore, against Rs1,323.04 crore a year earlier. The firm's spends shot up 48% during the quarter toRs162.5 crore from Rs109.6 crore in the same period a year ago. The maker of Cinthol soap and Aer air-fresheners said there are early signs of strong growth in the first quarter of the current fiscal.
"The macroeconomic and socio-political environment continues to be challenging in some countries which the company operates in. But we remain optimistic of growth momentum and expect our profit performance to improve on new launches and favourable input prices,"Adi Godrej, chairman of Godrej Consumer Products, said in a statement.
Hair oil and cooking oil maker Marico too reported a 20% jump in its net profit for the fourth quarter ended March atRs84 crore, helped by an exceptional gain of Rs33.2 crore. The maker of Parachute hair oil failed to match street expectations in its net sales, which stood at Rs997.25 crore in the March quarter against Rs909.36 crore in the last quarter on 2011-12. It had reported a net profit of Rs69.69 crore then.