With copra prices having relatively eased during the quarter, gross margin expanded by 230 bps sequentially and was marginally down YoY.
FMCG major Marico expects volume growth to be around 8-10 percent for FY19 and beyond, the company said in its statement. It also expects healthy market share gains in the India business.
The Mumbai-based company reported 12 percent year-on-year (YoY) growth in the net profit to Rs 251.7 crore for the third quarter ended December 2018 on the back of higher tax expense.
In the corresponding quarter last year, it posted net profit of Rs 223.28 crore.
In Q3FY19, revenue from operations grew 15 percent YoY to Rs 1,861 crore, with underlying domestic volume growth of 5 percent and constant currency growth of 11 percent in the international business.
With copra prices having relatively eased during the quarter, gross margin expanded 230 basis points (bps) sequentially and was marginally down YoY.
“Rural led the growth in the traditional channel, while the new-age channels of Modern Trade and e-commerce continued to surge ahead,” the company said.
Advertising and sales promotion spends rose 12 percent YoY. The company said investments towards brand building will be further ramped up to support market growth initiatives in core categories, expansion into adjacent categories and a visibly strong innovation pipeline for the next 2-3 years.
The company aims to build healthy foods, premium hair nourishment and male grooming into growth engines and expects to deliver value growth at 20 percent plus compounded annual growth rate (CAGR) over the medium term in these portfolios.
In the international business, the company expect to clock organic broad-based double-digit constant currency growth in the medium term.
The company’s parachute rigids posted robust volume growth of 9 percent, despite a high base.
Further strengthening of the brand equity and healthy traction in non-core markets contributed to the accelerated growth.
Its portfolio grew 19 percent in value terms on price hike taken at the beginning of the calendar year.
The coconut oil franchise that includes Nihar Naturals and Oil of Malabar held its volume market share at 59 percent.
Saugata Gupta, MD & CEO said, “In Q3, we have delivered a reasonably good performance. We have further consolidated the core portfolio in India and have now stabilized the international businesses. Having reinvigorated the new product development and go-to-market processes.”
