Marico Reports High Single-Digit Revenue Growth in Q2

New Delhi, Oct 2 (PTI) FMCG firm Marico Ltd on Wednesday said its consolidated revenue growth in the July-September quarter remained in high single-digits, as higher realisations in the domestic business was offset by incremental currency headwinds in some overseas markets during the second quarter of the ongoing fiscal.

In its update for the second quarter filed on bourses, Marico said the sector witnessed stable demand trends with rural outperforming urban on a year-on-year basis for the third quarter in a row.

"Consolidated revenue growth remained in high single-digits, as higher realisations in the domestic business was offset by incremental currency headwinds in some overseas markets. We expect consolidated revenue growth to move into double-digits in the second half of the year," the company said.

Marico said it expects to "deliver double-digit revenue growth in this year".

"In view of the higher-than anticipated degree of inflation in copra prices, sharp import duty hike in vegetable oils and potential uncertainty in crude oil prices in the wake of recent geo-political tensions, the company will focus on its stated revenue growth aspiration while remaining watchful on the margin front during the second half of the year," it added.

In the second quarter, the domestic business posted mid-single digit volume growth, exhibiting improvement on a sequential basis, it added.

The company's 'Parachute' coconut oil posted close to mid-single digit volume growth, partially impacted by 'ml-age' (volume) reduction in one of the key price-point packs in lieu of a price increase, it said.

"The brand recorded double-digit revenue growth, aided by pricing interventions made at the start of the year," it said, adding Parachute coconut oil took another round of price increase at the end of the quarter given the sequential rise in copra prices.

Saffola oils posted low single digit revenue growth, while the pricing cycle for the brand turned slightly favourable after eight quarters, Marico said, adding value-added hair oils were subdued amidst competitive headwinds in the bottom of the pyramid segment.

"We expect gradually improving demand trends ahead on the back of visible ATL (above the line) investments and brand activations across key franchises," it added.

Foods and digital-first brands sustained their visibly strong momentum and scaled up well ahead of aspirations, thereby maintaining the pace of diversification as envisaged, the company said.

The international business delivered robust low-teen constant currency growth in the second quarter with each of the markets contributing positively.

"Bangladesh posted high-single digit growth, demonstrating the strong resilience of our business model amidst a challenging operating environment which has now largely stabilised," Marico said.

The company further added that Vietnam also grew in high single digits, while Middle East and North Africa (MENA) and South Africa maintained their robust double-digit growth trajectory.