Marico reports 13% yoy growth in Q3 revenue aided by robust growth in domestic and international biz, PAT inches up to Rs317cr

31 Jan 2022 , 08:36 AM

FMCG company, Marico reported a consolidated net profit of Rs317cr for the quarter ending December 2021 (Q3FY22) slightly higher from Rs312cr of Q3 of last year and Rs316cr of the preceding quarter. Consolidated revenue from operations stood at Rs2,407cr in Q3FY22 rising from Rs2,122cr in December last year quarter, however, it dropped compared to Rs2,419cr of Q2FY22. On Monday, Marico stock will be in focus following result announcements.

In Q3FY22, Revenue from Operations grew by 13% YoY with both the domestic and international businesses posting healthy double-digit revenue growth.

On the domestic front, Marico stated that in India, unabated inflation across the consumer basket led to moderation in consumption patterns and the share of wallet of staples, while discretionary and out-of-home categories fared better owing to some degree of pent-up demand. As a result, overall FMCG market volumes witnessed a drop in Q3, with rural visibly lagging urban.

Further, Marico said that amidst the challenging operating environment, our domestic business put up a resilient performance with 12% revenue growth, while volumes remained flat YoY on a very strong base of 15%. Volume growth on a 2-year CAGR basis was 7.3%, much ahead of low single-digit growth for the FMCG market, exhibiting the inherent strength of our trusted brands and market position, backed by a sharp focus on execution and investment in brand building. This is also reflected in 94% of the portfolio logging market share gains and 95% of the portfolio gaining penetration on a MAT basis. Within traditional trade, performance in rural lagged urban during the quarter, in keeping with market trends. Alternate channels and CSD stayed on the growth path.

In the International business, Marico posted another stellar quarter with sustained profitable growth. The business delivered 18% constant currency growth with each of the Bangladesh, South East Asia and MENA businesses clocking high double-digit.

Meanwhile, Marico's gross margin improved sequentially by ~125 bps but was down ~329 bps YoY. With copra prices moderating further since late Dec’21 and edible oil prices off their highs, gross margins should maintain an upward trajectory sequentially. A&P spending was up 14%, as the Company chose to continue to invest in the brand building despite significant inflationary pressures and compression on profitability. EBITDA margin stood at 17.9%, down 155 bps YoY. EBITDA was up 4% YoY and PAT was up 1% YoY growth.