Marico Ltd Management Discussions

ECONOMIC SCENARIO

Global

At the turn of the calendar year, the global economy appeared to have stabilized after enduring a prolonged and unprecedented series of shocks, with steady yet underwhelming growth rates. However, the landscape has dramatically changed over the last couple of months as governments around the world reorder policy priorities and uncertainties have climbed to new highs.

Expressing concern over the shockwaves unleashed by Donald Trumps trade policies, the IMF trimmed its forecasts for almost every economy, besides paring global growth projections by 50 basis points to 2.8 percent (from 3.3% earlier) for 2025, after growing at 2.7% in 2024. It also estimates that US will witness a sharp deceleration from 2.7 percent in 2024 to 1.8 percent, while many emerging economies may face significant slowdowns. Tariffs are contributing to a broader increase in global prices, with the IMF raising its forecast for world consumer inflation to 4.3% in 2025. The tariff-driven uncertainty and tighter financial conditions have also heightened risks to global financial stability

According to the IMF, the USs effective tariff rate has surged past levels last seen during the Great Depression, and the ‘resulting epistemic uncertainty and policy unpredictability drove the revisions. If abrupt tariff changes persist beyond Trumps 90-day pause, it will further drag down global growth. More than its change in estimates, the IMFs take on global trade confirms that the world order, under which countries have been operating for the last 80 years, is decidedly undergoing a reset. More countries are recognising that the decades of deepening trade ties fostered a rapid, but uneven, growth.

Growth in China is forecasted to decline from 5.0% in 2024 to 4.0% in 2025, reflecting the impact of US tariffs, retaliatory measures by China, and heightened trade tensions. Increased government spending is unlikely to fully counteract these effects.

The IMF suggests that monetary policies will need to remain ahead of the curve in the face of multiple challenges. Faced with tariffs and supply-chain disruptions, some countries may have to contend with steeper trade-offs between inflation and output. Inflation expectations may also turn out less well anchored due to the impact of tariffs. In addition, currency markets may experience strong volatility. This may be difficult to navigate, especially for emerging market economies.

India

Indias economic trajectory remains resilient amid global headwinds, supported by strong domestic demand and structural reforms. Indias GDP is projected to have grown between 6.3% and 6.8% in the fiscal year 2024-25. Services, contributing half of GDP, remained robust at 7.3%, led by financial, real estate, and professional services, as well as public administration. Manufacturing growth slowed to 4.3% from 12.3% amid weak demand for industrial and mining products. Improved rural consumption, driven by strong farm output, lifted private consumption growth to 7.6%, contributing 4.3 percentage points to GDP, even as high-frequency data showed urban consumption growth slowing. Gross capital formation growth eased to 5.8% due to slower public investment. Net exports added 1.8 percentage points to growth, aided by strong exports and muted imports. Food inflation rose to 7.1% in the first 11 months of FY2025 (year ended March 31, 2025), driven primarily by a 21.8% increase in vegetable prices and a 7.3% rise in cereal prices.

RBI had cut policy rates by 50 basis points collectively in February and April 2025 MPC meetings, bringing the repo rate to 6.00% as of April 2025. The central bank shifted its policy stance to "accommodative" from "neutral" in April, citing rising global uncertainty due to tariff changes and other policy headwinds. The MPC highlighted global trade tensions, particularly those arising from the Trump-era tariff regime, as one of the key reasons for adopting a more supportive monetary stance. Despite challenging global conditions, the RBI observed that Indias growth trajectory appeared to be on a recovery path.

Indias urban labor market showed signs of strengthening, with urban unemployment marginally falling to 6.5% in April–December 2024, compared to 6.6% in the corresponding period of FY2024. The worker-to-population ratio improved to 50.3% from 49.3%, indicating job creation. However, wages paid by listed corporations declined in the first three quarters of FY2025, reflecting a slowdown in corporate sales growth following a period of rapid expansion. This moderation was particularly pronounced in the white-collar IT services sector, where hiring slowed after significant post-pandemic expansion. Robust rural consumption: agricultural growth hit a five-quarter high of 3.5%, aided by a strong monsoon season. Indicators like rising sales of FMCG and declining numbers of jobs demanded through MGNREGA confirm strength in rural demand. With healthy kharif harvests and improved rabi sowing, rural consumption is expected to remain strong, further boosted by festive season spending Indias economic expansion across key sectors remained robust, with manufacturing and services leading the charge. According to ADB, this momentum is expected to continue, supported by anticipated declines in crude oil prices in FY2026 and FY2027, which will ease input costs. Services will remain a primary driver of growth, bolstered by rising demand for professional services, education, health services, and continued strength in business services exports, where India maintains a competitive advantage. Manufacturings contribution to GDP growth is also projected to rise. However, construction sector growth is likely to moderate, due to softening housing demand following years of high growth. The agriculture sector is set for continued strong performance in FY2026, helped by robust winter crop sowing, especially of wheat and pulses, and adequate water reservoir levels—assuming weather patterns remain stable.

As per ADBs forecasts, Indias GDP growth is expected to rise to 6.7% in FY2026 and 6.8% in FY2027. This acceleration will be supported by accommodative monetary and fiscal policies, rising rural incomes, and moderating inflation, which should help restore consumer confidence. Consumption is expected to play a central role in driving growth, especially in rural areas, where terms of trade remain favourable, with food prices remaining higher than prices of other commodities. Middle-class and affluent households are also set to benefit from recent personal income tax cuts, estimated at 0.3 percentage points of GDP, providing a further consumption boost over the next two fiscal years. Inflation is forecast to fall to 4.3% in FY2026 and 4.0% in FY2027, in line with declining inflation in major advanced economies and easing crude oil prices. However, rupee depreciation, potentially triggered by volatile capital flows due to global policy uncertainties, could exert upward pressure on inflation. This is expected to be offset to some extent by falling crude oil prices, a major import for India.

A key downside risk to the growth forecasts, as per ADB, comes from the possibility of additional US tariffs on India and other exporting countries, which could dampen trade and investment flows and increase volatility in domestic financial markets. However, the impact of such tariffs on India is expected to be lower than for other export-oriented Asian economies, given that Indias merchandise exports to the US account for only around 2% of GDP. Furthermore, ongoing India–US trade negotiations may help mitigate some of these risks in the near term.

Bangladesh

Bangladeshs economy has demonstrated resilience despite facing both external and domestic headwinds. Although, GDP growth decelerated to 4.2% in FY2024 (year ended 30 June 2024), down from 5.8% in FY2023. This slowdown was primarily driven by a sharp moderation in industrial growth to 3.5%, compared to 8.4% the previous year, largely due to reduced export demand and persistent energy shortages. Additionally, foreign exchange reserves continued to decline, adding pressure on the exchange rate. According to the Asian Development Bank (ADB), GDP growth is projected at 3.9% in FY2025 (year ended 30 June 2025), before improving to 5.1% in FY2026 (year ended 30 June 2026). While the garments sector continues to support export growth, the near-term economic outlook faces some uncertainty due to moderated domestic demand, ongoing political transitions, potential natural disruptions, labour market challenges and inflationary pressures. Consumption and investment are expected to grow at a moderate pace, buoyed by strong remittance inflows. However, this will be partly offset by tight monetary and fiscal policies and investor caution. Over time, rising global tariffs could also weigh on Bangladeshs export performance and overall economic momentum. Improving the investment climate and restoring macroeconomic stability are critical to sustain higher growth.

Vietnam

Vietnams economy rebounded in the 2024 (fiscal year coincides with the calendar year), with GDP growth accelerating to 7.1% from 5.1% in 2023, despite disruptions from Typhoon Yagi. The recovery was driven by robust export-led manufacturing (industrial output up 8.2%), a rebound in tourism (services up 7.4%), and domestic consumption (up 6.6%). FDI disbursements hit a record $25.4 billion, up 9.4% year-on-year, reflecting investor confidence. The State Bank of Vietnam maintained an accommodative monetary stance to support growth. Looking ahead, the ADB projects GDP to grow 6.6% in 2025 and 6.5% in 2026. Vietnams government has set a GDP growth target of at least 8 per cent for 2025, with plans to reach double-digit growth in the following years, contingent on effective implementation of institutional reforms to boost governance and private sector development. However, risks remain. Rising global trade tensions and protectionist policies—especially from the US—could impact Vietnams export-driven sectors, given its large trade surplus.

Middle East and North Africa

Economic growth in the MENA region remained subdued at an estimated 1.8% in 2024, primarily due to extended voluntary oil production cuts by OPEC+ members, which curbed oil output among major exporters.

In the Gulf Cooperation Council (GCC) economies including Saudi Arabia, growth picked up modestly to 1.6%, supported by strong non-oil activity, robust labor markets, and a recovery in capital inflows. Inflation remained moderate across the GCC, largely due to exchange rate pegs to the US dollar, with core inflation hovering near zero since mid-2024. In Egypt, GDP growth slowed to 2.4% in FY2024 (ending June 2024), reflecting a decline in shipping through Suez Canal, reduced natural gas production, contracting non-oil manufacturing sector mainly due to higher input costs and lingering supply bottlenecks, and past foreign exchange shortages. However, the exchange rate liberalization in March 2024 restored investor confidence, boosting private sector activity in the latter half of the year. While headline inflation remains elevated across oil importers, it has eased gradually, particularly in Egypt, due to currency stabilization.

According to World Bank, MENAs growth is projected to rise to 3.4% in 2025 and 4.1% in 2026, driven by a gradual recovery in oil output. However, the outlook remains highly uncertain amid ongoing regional conflicts. Growth in the GCC is forecast at 3.3% in 2025 and 4.6% in 2026. In Saudi Arabia, growth is expected to strengthen, underpinned by robust non-oil sector expansion—particularly in services—and higher oil production and exports. In Egypt, growth is projected to accelerate to 3.5% in FY2025 and 4.2% in FY2026, supported by improving private consumption, strong remittance inflows, and enhanced investor sentiment.

South Africa

South Africas economy grew by 0.6% in 2024 and the National Treasury expects medium-term GDP growth to average 1.6 per cent from 2025 to 2027, underpinned by further progress in infrastructure reform and investment. However, structural constraints, particularly logistics bottlenecks and inefficiencies in state-owned enterprises (SOE), continue to weigh on overall economic performance. On the demand side, household consumption is set to rebound, driven by easing inflation and lower interest rates. Private investment is also expected to gather momentum, supported by rising business confidence and a more stable macroeconomic environment. Fiscal policy is likely to remain cautious, with a focus on stabilizing the public debt-to-GDP ratio by 2026. Achieving this goal will require disciplined spending and careful management of rising fiscal pressures, especially those related to the government wage bill, SOE support, and unfunded healthcare commitments.

FAST MOVING CONSUMER GOODS (FMCG) SECTOR IN INDIA

IMF expects India to become the third-largest economy by 2028, with consumption continuing to drive more than 50% of its GDP. With Indias per-capita FMCG consumption at c.US$ 49 being less than a quarter of its regional peers - many subcategories of FMCG having very low penetration levels. Within the FMCG sector, there seems to be substantial headroom for growth. The sector is poised for significant growth driven by rural resurgence, digital transformation, and a shift towards premium and sustainable products. However, navigating this transforming landscape requires addressing the slowdown in urban demand, rising raw material costs, and an increasingly competitive market. Key macro growth enablers are already in place, such as rising urbanization, growing aspiration of Indias middle class, better distribution infrastructure, deep digital penetration, and the rise of female participation in the workforce.

Key opportunities and Trends Shaping the FMCG Industry:

1. Indias Youth Is Redefining the FMCG Playbook

Millennials and Gen Z—projected to make up nearly 50% of Indias population by 2030—are shaping the next wave of consumer trends. Their preferences are rooted in convenience, digital-first behaviour, and wellness. They expect seamless deliveries, are highly engaged online, and value clean-label, and nutrition-focussed products. This cohort is also harder to reach through traditional marketing channels. They are research-driven, comparison-oriented, and demand transparency—prompting a surge in "know before you buy" behaviour. Packaging now serves not just as a branding tool, but as a critical information source. Furthermore, branded products continue to enjoy preference over unbranded alternatives, being viewed as more reliable, safe, and aligned with health-conscious lifestyles.

2. Premiumization on the Rise: Aspirations Fuel Consumption

Indias socio-economic landscape is undergoing a profound transformation. A burgeoning middle class now represents the largest segment of the population, as the low-income cohort shrinks and affluence rises. This shift is catalysing greater consumer spending, driving demand for premium and aspiration-led products across categories such as personal care, home care, nutrition, and wellness. McKinsey projects India will be home to the worlds third-largest high-income household base by 2030. In cities, consumers are spending more on skincare, wellness, and lifestyle enhancements. Health foods, once niche, are now mainstream—urban households increasingly include fortified staples and supplements in their daily diets. This aligns with the broader shift towards preventive healthcare, lifestyle-driven choices, and holistic well-being—making premiumization not just a status symbol, but a functional preference.

3. D2C Brands are Reshaping the FMCG Ecosystem

The traditional FMCG model—marked by time-consuming consumer research, broad-based product development, and reliance on fragmented distribution networks—is being redefined. The rise of digital technology, a more experimental consumer mindset, and an entrepreneurial start-up ecosystem have given birth to a new breed of FMCG players: Direct-to-Consumer (D2C) brands. These brands leverage digital channels to go straight to the consumer, skipping intermediaries. With sharp value propositions, targeted digital marketing, and deep consumer insights, theyve scaled rapidly. Their agility allows them to innovate faster, build emotional resonance, and form tight-knit communities of brand loyalists. D2C brands are also masters of retention and re-engagement—often using social media, influencer tie-ups, and subscription models to maintain direct and repeat touchpoints with their consumers. As they continue to mature, many are exploring hybrid models and offline expansion, further strengthening their presence.

4. Rapid growth of E-commerce Channel Driven by Quick-Commerce

The pandemic changed how Indians shop, pushing more people online—and this shift is here to stay. E-commerce is now a key part of FMCG sales. As per Nielsen, online FMCG sales could reach 11% by 2030—an eightfold increase from the current level. This evolution is not just about online sales displacing modern trade. Its also transforming traditional kiranas—many of which are upgrading their storefronts, adopting digital payments, and ordering directly from FMCG brands. This blurring of offline and online models is expanding product availability, enhancing convenience, and enabling better coverage through platform partnerships.

A big trend in this space is the rapid rise of Quick-Commerce —a model that promises deliveries in minutes. Indias dense urban clusters, coupled with low-rent dark store networks, make it an ideal market for this hyper-fast format. Over two-thirds of all online grocery orders and nearly 10% of total e-retail spending in 2024 occurred via Q-commerce platforms. These platforms now include personal care, medicines, drinks, and snacks. Bain & Company expects it to grow over 40% annually through 2030, driven by expansion into new categories, beyond metro cities, and growing consumer comfort with app-based instant shopping.

5. The New Digital India

In a post-COVID world, digital transformation is no longer optional—its central to FMCG competitiveness. Predictive analytics and machine learning now guide everything from product development to distribution strategy. Real-time data enables brands to tailor offerings, forecast demand, and fine-tune pricing. Simultaneously, rising smartphone penetration and 5G rollout have turned search results, reviews, and influencer opinions into pivotal touchpoints in the consumer journey. Companies that understand this digital ecosystem and can deliver value seamlessly—whether online or offline—will be the ones that lead. Digital platforms are growing in relevance, especially social media which is extremely critical for engagement and conversion. Unlike traditional media, digital ads are bite-sized, visual, and interactive, allowing brands to insert themselves effectively into consumer decision moments. Whether through influencer marketing, short-form videos, or contextual ads, companies are increasingly leveraging digital touchpoints to sway choices and drive purchases in real-time.

6. Sustainability – a natural part of Indias consumer journey

According to Bain & Company, while Indian consumers do consider sustainability a buying factor, its less of a conscious decision and more of an intuitive one, shaped by culture and values. Around 80% of Indians express strong concern about climate change and sustainability. "Natural" is preferred across food and non-food categories, with packaging waste emerging as a key issue. Brands must embed sustainability across the value chain—using recyclable or reusable packaging, minimizing waste, and offering transparency in product sourcing. Collaborations with retailers can further promote eco-friendly behaviors through refill programs and green promotions. The sweet spot? Delivering health, quality, and affordability—while gently nudging consumers toward greener choices.

7. Rural Consumption – A Structural Tailwind for FMCG

Rural India presents a compelling growth opportunity for the FMCG sector, driven by rising consumption, improved infrastructure, and digital penetration. The average rural FMCG basket size has surged ~60% between 2022 and 2024 (Kantar), with a clear shift towards premium products. Increasing internet access and smartphone adoption are enabling deeper engagement through e-commerce and digital marketing. Distribution networks continue to expand, aided by low unit packs and tailored rural strategies. Advanced analytics and targeted interventions are also improving demand forecasting and marketing efficiency in these regions. With rural per capita income rising and the share of population remaining dominant (~65%), FMCG companies are well-positioned to capture long-term value. Strategic investments focused on local innovation, last-mile reach, and digital integration will be key to unlocking this potential.

PERFORMANCE OVERVIEW

In FY25, Marico Limited posted a consolidated turnover of H10,831 Crores, up 12% from the previous year. The underlying volume growth in the India business was 5% and constant currency growth in the international business was 14%. The business delivered operating profit of H2,139 Crores up 6% over the last year. The operating margin stood at 19.7%, down ~125 bps from the previous year. Recurring consolidated net profit after tax was at H1,593 Crores, up 8% over the last year. Reported consolidated net profit after tax was at H1,629 Crores, up 10% over the last year.

India Business (75% of Consolidated Revenues)

The India business delivered a turnover of H8,110 crore in FY25, reflecting a 14% year-on-year growth, aided by price interventions in core categories in response to a sharp rise in input costs. Underlying volume growth stood at 5%, underscoring a resilient performance across key portfolios and the accelerated scale-up of new businesses. The operating margin for the India segment was 20.2% in FY25, compared to 22.4% in the previous year. The margin moderation was attributed to elevated copra and vegetable oil prices, which was partially mitigated through pricing actions in key portfolios.

Coconut Oil (~38% of Domestic Business)

Parachute Rigids (blue bottle packs) delivered a volume growth of 2% in FY25. Reported volume growth was impacted by consumption titration (typical during hyper-inflationary cycles) amidst sharply elevated copra and consumer prices, especially during the second half of the year, in addition to ml-age reduction undertaken to effect price hikes in select packs. The brand delivered 13% revenue growth, aided by pricing interventions during the year. Despite the challenging environment, the brand demonstrated resilience, gaining approximately ~70 bps in volume market share on a MAT basis. Separately, the flanker Coconut Oil portfolio (including Nihar Naturals and Oil of Malabar) recorded mid-single digit volume growth in FY25. Overall, the volume market share of the Coconut Oil franchise was at 63%.

Parachute continues to maintain its stronghold in the branded coconut oil segment, while 25-30% of the market remains unbranded - presenting a compelling opportunity to convert loose oil users and further expand share. The brand will remain proactive in its pricing strategies, particularly in core markets, to effectively balance premium against the unorganised segment. Efforts to enhance brand salience will continue, with a focus on communicating the impeccable purity and quality of the offering through targeted campaigns, especially in regions where unbranded usage remains high. We remain committed to reinforcing Parachutes equity across markets by driving awareness around the ‘Goodness of Pure Coconut Oil and intensifying micro-marketing efforts to deepen household penetration.

Saffola Edible Oils (~19% of Domestic Business)

Saffola Edible Oils recording low single-digit volume growth in FY25, holding steady despite a sharp rise in vegetable oil prices. Revenues grew 13%, supported by price hikes implemented in response to increase in vegetable oils prices triggered by the hike in import duties in September 2024. We expect the brand to remain competitive as long as there is no significant volatility in vegetable oil prices during the course of FY26.

The brands high-impact ‘Step Up for Your Heart campaign reached 26 million people across Indias top 15 cities in India. Drawing on research that shows daily stair climbing can reduce heart disease risk by 20%, the initiative promoted simple lifestyle changes for heart health. The campaign integrated digital outreach, celebrity endorsements, and science-based messaging, reinforced through a robust mix of traditional and new-age media. An innovative AI-enabled website feature allowed users to track stair-climbing progress and receive personalized insights and dietary tips based on the results.

Saffola also launched the ‘Power of 3 campaign, spotlighting the health benefits of Saffola Golds scientifically designed blend of MUFA & PUFA, antioxidants, and essential vitamins. The campaign advocated proactive health management, urging consumers to take a "Roz Ka Healthy Step" to prevent lifestyle diseases increasingly emerging by age 40—once common only at 60. The brand continues to position diet as a critical enabler of long-term health and wellness.

The brand also continued to champion mindful consumption by upholding the "Less Oil, But The Right Oil" ideology, in line with its commitment to helping consumers make healthier lifestyle choices.

Foods (~11% of Domestic Business)

The Foods portfolio delivered robust 33% growth in FY25, surpassing the H900 crore mark. Growth was fuelled by healthy momentum in core franchises as well as accelerated scale up of the nutraceuticals portfolio of Plix and True Elements, along with encouraging traction across recent innovations. The business continued to scale on the back of sustained investments in market development, enhanced cost efficiency, and improvements in supply chain and go-to-market strategies.

Saffola Oats retained its position as the #1 brand in the oats category, delivering healthy double-digit growth while continuing to gain volume market share. Both the plain Oats and Saffola Maasla Oats franchises delivered strong double digit growth. During the year, we launched Saffola Cuppa Oats, a convenient, 4-minute ready snack available in Magic Masala and Spicy Mexicana variants. With a unique blend of oats, millets, and crunchy multigrain bites, the offering is tailored for modern consumers—working professionals, young adults, and students—seeking taste and nutrition with minimal effort. To accelerate growth, we are expanding reach through deeper outlet penetration, increasing shelf visibility in both General Trade, Modern Trade, and driving e-commerce adoption.

Saffola Soya Chunks: Our plant-based protein proposition, Saffola Soya Chunks, continued its strong trajectory and is on track to becoming a H100+ crore brand in the medium term. The product resonated across core markets, supported by the proposition of being "Indias softest & tastiest soya."

Saffola Honey continued to strengthen its presence, holding close to double-digit market share in Modern Trade and 20%+ market share in E-Commerce. Backed by consistent media investments and activations in core markets, the brand has witnessed strong penetration and sustained growth. We aim to fast-track this momentum by expanding distribution and building its category presence.

During the year, the brand relaunched its offering in the ready-to-eat snacks category with Saffola Crunchiez Ragi Chips. Ragi chips have 50% less saturated fat than chips fried in palm oil. Currently launched in two mouth-watering flavours - Masala Twist and Takatak Tomato, the offering is available in small and family packs.

The brand also entered the fastest growing segment within breakfast cereals with Saffola Muesli in three exciting variants — Berry Crunch, Kesar Crunch, and Choco Crunch — inspired by flavours traditionally enjoyed with milk. Whether its the rich aroma of kesar, the fruity burst of berries, or the indulgence of chocolate, each variant is designed to make breakfast both nourishing and delightful. Crafted with a natural blend of multigrain and millets, the product retains its crunch till the last bite, offering a satisfying texture and taste experience. The offering is tailored for health-conscious consumers looking to add variety and excitement to their morning routine, without compromising on quality or taste - reinforcing its position as a smart breakfast choice for urban, on-the-go consumers.

Furthering our millet-focused innovation agenda, we launched Saffola Masala Millets in two flavourful variants — Masala Delight and Tomato Delight. These ready-to-cook products are designed to bring together the nutritional richness of millets with the bold appeal of Indian spices, offering consumers a wholesome meal that doesnt compromise on taste. The product is aligned with our vision to democratize healthier food options by ensuring affordability, accessibility, and convenience for a wide consumer base. It also strengthens our position in the fast-growing millet-based ready meals segment, in sync with Indias rising interest in traditional grains and their modern-day versatility.

True Elements scaled up impressively in FY25, remaining steadfast in its commitment to innovation and clean nutrition. The brand is well-positioned to accelerate growth by strengthening its presence across channels, especially through deeper penetration in Offline Trade and further leveraging the fast-evolving Quick Commerce ecosystem. In FY25, the brand launched a new campaign with Indian cricketer Rohit Sharma, unveiling the co-owned sub-brand — RS by True Elements. The campaign highlights Rohit Sharma endorsing the brands commitment to healthy, 100% natural ingredients and clean-label food. Plix, our digital-first, plant-based brand in nutraceuticals and personal care, sustained its rapid growth trajectory in FY25. Plix holds the potential to scale to H1,000 Cr. in revenues in the medium term. The brand continues to gain popularity for its innovative effervescents, functional nutrition, and fruit-infused personal care solutions. Its diverse portfolio—spanning weight management, skin wellness, and more—caters to the lifestyle and wellness needs of Gen Z and Millennials, supported by a strong digital-first community and a focus on quality and effectiveness.

Value-Added Hair Oils (~19% of Domestic Business)

The Value-Added Hair Oils (VAHO) portfolio declined by ~4% in value terms, dragged by irrational competition intensity in the bottom-of-the-pyramid segment. Within the category, mid and premium segments continued to perform relatively better. The franchise maintained its leadership position with 28% value market share, up 120 bps on MAT basis. We expect the franchise to witness a gradual recovery through FY26, supported by improving rural consumption trends, sharper focus on portfolio premiumization, fuelled by product innovation, and targeted interventions aimed at reviving the bottom of the pyramid portfolio.

Nihar Shanti Badam Amla

The brand had challenging year amidst persistently irrational competition. However, we are confident of a gradual turnaround driven by focused interventions. Our rural micromarketing strategy continued to deliver incremental media reach in deep rural, media-dark regions, aimed at enhancing brand awareness and driving penetration through consumer upgrades.

Parachute Advansed Jasmine

The brand delivered a resilient performance, maintaining its momentum despite intensifying competition, and continued to gain market share during the year. Strategic focus remained on maximizing spontaneous awareness and driving festive-led activation. The launch of the #ShineBejhijak campaign, featuring track and field athlete Jyothi Yarraji, brought alive the incredible power of the human spirit. The campaign highlighted not just her sporting achievements but also her identity as a devoted daughter, loyal friend, and passionate artist, celebrating her multifaceted persona.

Hair & Care

With its refreshed damage repair proposition, Hair & Care continued to drive brand penetration. The brand reinforced its association with damage repair through festive occasion relevance, such as the ‘Holi Hair Damage Repair campaign. During the year, the brand launched a new digital campaign addressing the downsides of DIY hair hacks, presenting a smarter solution to repair hair damage — Hair & Care Triple Blend. The campaign emphasized the brands core message: "Hair & Care – an easy solution to repair hair damage."

Parachute Advansed Ayurvedic Hair Oil

The brand maintained its strong presence in the anti-hair fall segment in the South. It launched a compelling new campaign — #RecommendedbyRealSufferers: built on the pillars of efficacy and trust. The campaign emphasizes authentic recommendations from real users who have experienced and overcome the challenge of hair fall, enhancing the brands credibility and resonance. Over the medium term, our growth agenda for the Value-Added Hair Oils franchise is anchored in a three-pronged strategy:

Drive deeper engagement at the bottom of the pyramid, by capitalizing on growing value-consciousness and consumer preference for trusted brands.

Accelerate growth in the mid-segment through strategic pricing decisions and brand renovation.

Expand market share in the premium segment, where we currently have a relatively lower presence, by investing in brand-building efforts and innovations that offer superior sensorial experiences and functional benefits.

Premium Personal Care and Digital First Portfolio (~11% of Domestic Business)

The Premium Personal Care portfolio had a remarkable year led by strong scale-up in the Digital-First portfolio. The Male Grooming, Premium Hair Nourishment and Skin-care segments closed the year on a flattish note at ~ 300 Cr. in revenues.

Set Wet continued to maintain its market leadership in hair styling, supported by sustained investments in marketing and distribution, ensuring a strong and consistent presence among its target audience.

Livon launched a digital campaign titled Uncut with Livon – #ExpressInStyle. The campaign featured a social experiment where four panellists from diverse backgrounds were asked to guess the professions of four women solely based on their hairstyles. The initiative aimed to empower women to express themselves unapologetically through their unique styles—an ethos deeply embedded in Livons brand DNA.

The Digital-First portfolio—comprising Beardo, Just Herbs, and the personal care segment of Plix scaled well ahead of aspirations.

Beardo

Beardo continued its impressive growth journey, evolving from a beard-centric startup in 2015 into a comprehensive male grooming powerhouse. Today, more than two-thirds of its revenue comes from non-beard grooming products, reflecting its successful transformation into a full-stack grooming brand. The brand posted 20%+ growth in FY25 and closed in on double-digit EBITDA margin.

The brand has the potential to reach L 500 cr. mark in the medium term.

Beardos brand essence lies in celebrating masculinity, with the beard symbolizing its timeless core identity. This archetype-led approach differentiates Beardo in the male grooming space. Its innovation-first mindset was evident in product launches like the Hair Styling Spray, Hair Growth Vitalizer, Rosemary Essential Oil, and Hair Removal Spray. The brand launched its campaign The Bearded Boss featuring Hrithik Roshan, titled "Evolution Ends with the Bearded Boss". Through this, Beardo reinforced its philosophy of challenging stereotypes and championing self-expression. The campaign positioned a well-groomed beard not merely as a style statement, but as a symbol of confidence, leadership, and authenticity. Additionally, Beardo amplified its brand reach through another impactful campaign featuring Aditya Roy Kapoor.

Just Herbs

Just Herbs seamlessly blends traditional Ayurvedic wisdom with modern science to offer beauty solutions that are safe, honest, and effective. In FY25, the brand crossed H100 crore in sales, supported by portfolio expansion into natural makeup and pure fragrances. A standout campaign during the year featured the legendary Zeenat Aman and glamorous Rakul Preet Singh in a fun and heartwarming dialogue on the meaning of beauty. Looking ahead, Just Herbs aims to enter the luxury makeup segment, strengthen its skincare and haircare lines with herb-based ingredients, and explore new channels such as organized retail and exports, while continuing to scale its online presence and partnerships with leading beauty retailers.

Pure Sense

Pure Sense is a fruit-led personal care brand offering skincare, mood-elevating fragrances, and bath & body products. The brand champions the philosophy that beauty is rooted in well-being and seeks to create a joyful self-care experience that is both nourishing for consumers and respectful to the environment. To strengthen its positioning, the brand partnered with Bollywood actress Soha Ali Khan to launch the Watermelon Burst Glow Face Serum.

With a strategic focus on building brand equity through influencer marketing and educational content,

Pure Sense is well-positioned to strengthen their relevance in the haircare and skincare markets and enhance their share of voice.

Sales and Distribution in India

Maricos Sales & Distribution network witnessed significant advancements in FY25, building on the Sales 3.0 framework introduced two years ago. This framework has sharpened our micro-market focus, enabled agile decision-making on the ground, and leveraged technology and analytics to drive superior execution. A key thrust this year was on improving efficiency and productivity through initiatives like the Sales Control Tower and the Every Day Great Execution (EDGE) programme. Focus areas included expanding retail presence, increasing direct distribution, and enhancing range selling in rural markets. Our network now reaches nearly 5.8 million outlets, spanning over 60,000 villages and nearly all towns with a population above 5,000.

General Trade - Our current GTM strategy is centred around stabilizing and enhancing execution across People, Infrastructure, and Processes. To unlock profitable growth and long-term competitiveness, we launched Project SETU — a three-year roadmap to build a future-ready GTM model. Project SETU aims to expand Maricos direct reach from approximately 1 million outlets to 1.5 million by FY27. This expansion is expected to deliver three key benefits: enhanced in-store assortment, by driving distribution of key brands and promoting mid-to-large packs to support consumer upgrades; infrastructure optimization, through modernization of the distribution model and organizational structure, including adoption of Cloud DMS for greater operational efficiency and data security; and improved distributor ROI, by strengthening sales capabilities via tech tools and training, adopting smarter investment models, and enabling real-time KPI tracking. These investments will be cost-neutral, funded through resource reallocation—optimized trade spends, reduced inefficiencies in organized trade and wholesale channels, and improved process discipline.

Project SETU was kicked off in 11 states during the year. We continue to drive efficient coverage across all geographies to deliver business growth and investments in infrastructure across all town classes. In addition, the initiative will now focus on expanding rural coverage at a pan-India level.

We progressed on our 3-Year Sales IT Roadmap aimed at building best-in-class systems. The highlights are as follows:

Piloting an AI/ML-powered product recommendation engine to improve in-store assortment and outlet productivity.

Introducing system-led hygiene controls for stronger process compliance and proactive interventions.

Enhancing the digital experience for channel partners with improved usability and seamless interactions.

Modern Trade delivered strong performance across key categories, driven by deep partnerships with channel partners and a focus on in-store execution excellence. Backend technology interventions like AI-powered order processing and control tower mechanisms—boosted fill rates, improved on-shelf availability (OSA), and reduced out-of-stock (OOS) situations.

E-Commerce posted double-digit growth, led by healthy performance in priority categories and tremendous scale of the Quick Commerce sub-channel. Growth was powered by distribution expansion across e-grocers, category activations in personal care, and pack innovations for strategic accounts. We continue to partner closely with platforms to ensure portfolio availability, input compliance, and best-in-class media execution to deliver superior value to consumers.

International Business (25% of Consolidated Revenues)

The International business recorded a turnover of Rs. 2,721 Crores in FY25, registering 8% growth year-on-year in INR terms. Constant currency growth stood at 14%, underscoring the businesss strong resilience amidst currency depreciation and macroeconomic headwinds in select markets. Operating margin improved to 27.9% in FY25, up from 26.8% in the previous year, driven by premiumisation of portfolios across markets and operating leverage from accelerated scale-up in the MENA and South African regions.

Bangladesh (~42% of International Business)

Bangladesh continued to demonstrate visible resilience despite early operational headwinds, which eased in the latter half of the year. The business delivered constant currency growth of 12% in FY25, supported by strong brand equity, a well-entrenched distribution network and effective leadership. Strategic focus remains on strengthening the core portfolio while expanding newer categories such as Hair Care, Baby Care, and Shampoos. The business has steadily reduced its dependence on the Coconut Oil portfolio, which now contributes ~60%. Leveraging its strong distribution backbone and learnings from India, the Company remains focused on scaling these growth engines and enhancing its brand presence. The medium-term outlook for Bangladesh remains strong.

Vietnam (~20% of International Business)

Vietnam posted 4% CCG in FY25, impacted by transient sluggishness in core categories. The business has seen strong traction in shower gel segment, while Purit? de Pr?vence and ?liv strengthened presence in the female personal care segments.

Middle East and North Africa (MENA) (~18% of International Business)

The MENA region posted constant currency growth of 36% in FY25, led by strong traction across markets. The Middle

East and Egypt businesses grew 26% and 73% respectively in constant currency terms, driven by a well-rounded performance across portfolios and successful new product launches in both geographies.

South Africa (~9% of International Business)

The South Africa business delivered constant currency growth of 19% in FY25, led by strong performance in the Health Care and Hair Care segments.

New Country Development & Exports (~9% of International Business)

The New Country Development and Exports segment grew 16% in FY25. The Company continues to remain optimistic about the long-term prospects of this business as it incubates new geographies to broaden its global footprint.

OVERVIEW OF CONSOLIDATED RESULTS OF OPERATIONS

Total Income

Our total income consists of the following:

1. Revenue from operations comprises sales from ‘Consumer Products, including coconut oil, premium refined edible oils, value-added hair oils, anti-lice treatments, fabric care, functional and other processed foods, hair creams and gels, hair serums, shampoos, shower gels, hair relaxers and straighteners, deodorants and other similar consumer products, by-products, scrap sales and certain other operating income.

2. Other income primarily includes profits on sale of investments, dividends, interest, GST budgetary support and miscellaneous income. The following table states the details of income from sales and services for FY24 and FY25:

Particulars (Rs. Crore)	FY24	FY25
Revenue from operations	9,653	10,831
Other income	142	208
Total Income	9,795	11,039

Expenses

The following table sets the key profit and loss account line items for FY24 and FY25:

Consolidated P&L (Rs. Crore)	FY24	% of Revenue	FY25	% of Revenue
Revenue from operations	9,653		10,831
Cost of materials	4,748	49.2%	5,388	49.7%
Employee Cost	743	7.7%	831	7.7%
Advertisement and Sales Promotion	952	9.9%	1,128	10.4%
Other Expenditure	1,184	12.3%	1,345	12.4%
EBITDA	2,026	21.0%	2,139	19.7%
Depreciation and Amortization	158	1.6%	178	1.6%
Finance Charges	73	0.8%	53	0.5%
Profit before tax	1,937	20.1%	2,116	19.5%
Tax	435	4.5%	458	4.2%
Reported Profit after tax and MI	1,481	15.3%	1,629	15.0%
Recurring profit after tax and MI*	1,470	15.2%	1,593	14.7%

*For FY25, Recurring profit after tax (after minority interests) excludes one-off gains on the sale of fixed assets and favourable settlement of a past litigative claim (both classified under ‘Other Income), amounting to ~H42 cr. pre-tax For FY24, Recurring profit after tax (after minority interests) excludes the one-time gain from the sale of fixed assets (classified under ‘Other Income), amounting to ~H14 cr. pre-tax.

Cost of Materials

Cost of materials comprises consumption of raw material, packing material and semi-finished goods, purchase of finished goods for re-sale and increase or decrease in the stocks of finished and work-in-progress goods and by-products. In FY25, prices of domestic copra were up by 48%, rice bran oil increased by 25%, LLP was down 8% and HDPE was down 4%.

Direct Tax

The effective tax rate (ETR) was 21.7% in FY25 and is expected to be ~22% in FY26.

Capital Utilisation

Given below is a snapshot of various capital efficiency ratios for Marico:

Particulars	FY25	FY24
Return on Capital Employed (ROCE, %)1,2	47.2	44.7
Return on Net Worth (RONW, %)	41.7	38.8
Debt Equity Ratio (X)	0.09	0.11
Current Ratio (X)	2.05	1.64
Interest Coverage Ratio (X)	37.0	25.6
Working Capital Ratios (Group)
Debtor Turnover (Days)	40	40
Inventory Turnover (Days)	44	49
Net Working Capital (Days)3,4	35	32

The Company has maintained healthy working capital and return ratios through the year.

Return on Net Worth (RONW) improved to 41.7%, owing to healthy growth in net profits coupled with operational efficiencies. Current ratio has improved from 1.64 to 2.05 as a result of increased current investments funded by cash flow from operations. Interest Coverage Ratio expanded to 37x in FY25 as against 25.6x in the previous year primarily on account of lower finance cost given the fall in interest rates.

Shareholder Value

Your Companys wealth distribution philosophy aims at sharing its prosperity with its shareholders, through a formal earmarking/disbursement of profits to its shareholders, while retaining sufficient profits in the business for various purposes. The dividend pay-out ratio in FY25 was ~85% of the recurring consolidated net profit after tax as compared to ~83% on a similar basis in the previous year. Your Company is committed to maintaining a strong dividend pay-out, in accordance with its Dividend Distribution Policy.

Outlook

In FY25, the FMCG sector witnessed steady demand trends, supported by gradual recovery in rural sentiment and stable urban consumption. The year was also marked by rising commodity prices, which drove pricing growth across categories. The uptrend in rural growth was supported by a healthy monsoon season, higher MSPs and continued government spending. Urban consumption trends were a mixed bag, with healthy sentiment prevailing among upper-middle and affluent segments, while bouts of elevated retail and food inflation during the year weighed on mass urban consumption. Alternate channels such as Modern Trade and E-commerce continued gaining traction, even as General Trade remained under pressure.

In the given context, the India business delivered strong double-digit revenue growth in line with aspirations as the core portfolios posted a resilient and competitive performance amidst sharp input cost inflation, while the new businesses maintained their strong scale up momentum.

We expect gradually improving growth trends in the core categories on the back of moderating trends in retail and food inflation as well as promise of a healthy monsoon season. This will be further aided by our ongoing initiatives to support select General Trade (GT) channel partners and transformative expansion in our direct reach footprint under Project SETU. We also continue to draw confidence from healthy offtakes, penetration and market share gains in our key portfolios. We will continue our focus on driving differential growth in our urban-centric and premium portfolios through the organized retail and E-Commerce channels. Therefore, we expect to deliver consistent and competitive growth in the medium term through a much sharper and targeted portfolio and SKU strategy in each channel.

Sustained investment towards the accelerated scale up of our Foods and Premium Personal Care portfolios has not only resulted in a visible shift in the revenue construct of the India business, but also enabled differential growth outcomes amidst relatively slower demand in mass consumption-led franchises over the past few quarters. We will continue to aggressively diversify the portfolio through these portfolios in line with our medium-term strategic priorities. Foods stood at 5x of FY20 revenues in FY25, surpassing the H900 crore mark. We aim to grow Foods at 25%+ CAGR to ~8x of FY20 revenues (~2x of FY24 revenues) in FY27. The Digital-first portfolio clocked ARR of H750 crore on exit basis in FY25, surpassing aspirations for the year. We expect to scale this portfolio to ~2.5x of FY24 ARR (earlier ~2x of FY24 ARR) in FY27. Consequently, we expect the India revenue share of the Foods and Premium Personal Care portfolios to expand to ~25% by FY27.

The rapid scale up of these portfolios has been accompanied by significant improvement in their profitability, resulting in their share of India Net Contribution (NC) moving to double digits (~5x of FY22 levels). This underscores the profitable and sustainable growth focus of the diversification strategy. We will continue to focus on driving consistent improvements in profitability as constituent franchises of the Foods and Digital-First portfolios attain critical mass. We have effected structural GM expansion of ~1000 bps in Foods over FY24 and FY25. We expect gradual improvement in gross and operating margins of the Foods portfolio as we scale up over the medium term. Among Digital-first brands, Beardo closed in on double-digit EBITDA margin this year. Plix delivered low single digit EBITDA margin this year. We aim to replicate this playbook and achieve double-digit EBITDA margin in the portfolio in FY27.

The International business has navigated headwinds, including macroeconomic volatility and currency devaluation in select markets. While the Bangladesh and Vietnam businesses remain strong anchors, the robust momentum in the MENA and South Africa businesses has visibly strengthened the revenue construct of the overall international business. This also reflects in the steadily reducing topline and bottomline dependence on the Bangladesh business. We have also made visible strides towards premiumisation of our portfolios across markets through innovation and expansion into premium personal care categories such as shampoos, skin care, hair styling/ care (ex-hair oils) and baby care. These portfolios have scaled at 24% CAGR over FY21-25 period and we aim to deliver 25%+ growth in the medium term. As a result, their revenue share in the International business rose from ~20% in FY21 to ~29% in FY25. We will continue to invest aggressively towards diversifying the portfolio, expanding the total addressable market and driving market share gains in each of the markets. We aim to maintain the double-digit constant currency growth momentum in the International business over the medium term.

We will also continue to scout for inorganic growth opportunities that offer meaningful potential to consolidate our competitive position in existing categories, expand the total addressable market in existing geographies or access markets of interest, thereby adding visible levers to drive long term value creation.

Pursuant to the strategic objectives set at the start of this year, we have delivered on most counts, in addition to diversification of the portfolio. The India business has posted marked improvement in underlying volume growth and double-digit revenue growth in FY25. The international business has delivered double-digit growth in constant currency terms. Looking ahead, we remain committed to investing in brand building consistently in line with our strategic vision to strengthen the core and accelerate differentiated growth across new franchises. The business delivered ~20% operating margin in FY25, amid escalating input cost inflation in the second half of the year. Despite transient input cost headwinds in the near term, we expect to sustain the double-digit revenue growth momentum and will strive to deliver double-digit operating profit growth in FY26.

Owing to the strengthening growth construct of the business, we maintain our aspiration to deliver double-digit revenue growth in the medium term through consistent outperformance vis-?-vis the category and market share gains in the India core portfolios, accelerated growth in the Foods and Premium Personal Care and double-digit constant currency growth in the International business. We also expect operating margin to inch up over the medium term with leverage benefits as well as premiumisation of the portfolios across both the India and International businesses.

Notes:

1) Net Contribution (NC) is calculated as Net Revenues less all variable costs and marketing expenses

HUMAN RESOURCES

We empower our people to unlock their full potential through collaboration, inclusion, and the ‘Marico Way—a blend of purpose, ethos, and values. Our unwavering focus on a people-first culture is anchored in trust, transparency, inclusion, integrity, and an owners mindset. As we shape Marico 3.0, we remain committed to strengthening critical pivots of organisational culture, structure, talent, leadership as well as our ways of working. Over the course of the last year, we took several initiatives in this direction, which are presented in the chapter titled ‘Members.

INFORMATION TECHNOLOGY & DIGITAL

We continue to deepen our digital and analytics capabilities to strengthen operations, enhance efficiency, and elevate consumer experience. We are actively leveraging social media, e-commerce platforms, and targeted digital marketing to boost engagement and build brand loyalty across our diverse portfolio. Advanced analytics fuel product innovation and sharpen consumer insights are helping us stay ahead of evolving needs. We are streamlining manual processes through computer vision and bots to improve speed and accuracy. We are also proactively identifying workforce risks to enable timely interventions. Further details of the latest initiatives have been provided in the chapter titled Consumers.

RISK MANAGEMENT

Risk management is being positioned as a strategic enabler across the organization, not just a reactive safeguard. Our integrated framework addresses risks arising from both the external environment and internal operations. We are continuously evolving our approach to proactively address emerging risks and uncertainties in a dynamic business environment, strengthening our ability to make informed and future-ready decisions. Details of the risks envisaged and our strategic response to the same are presented in the chapter titled ‘Risk Management.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

We have a well-established and comprehensive internal control structure across the value chain to ensure that:

Our assets are safeguarded and protected against loss from unauthorized use or disposition,

Transactions are authorized, recorded and reported correctly and operations are conducted in an efficient and cost-effective manner.

The key constituents of the internal control system are:

Establishment and periodic review of business plans

Identification of key risks and opportunities and regular reviews by top management and the Board of Directors

Policies on operational and strategic risk management

Clear and well-defined organization structure and limits of financial authority

Continuous identification of areas requiring strengthening of internal controls

Standard Operating procedures to ensure effectiveness of business processes

Systems of monitoring compliance with statutory regulations

Well-defined principles and procedures for evaluation of new business proposals/capital expenditure

Robust management information system

Comprehensive Information Security Policies and guidelines

Comprehensive internal audit and review system

Well-defined Internal Financials Controls framework

An effective whistle-blowing mechanism

Training/awareness sessions on policies and code of conduct compliance

Robust Crisis Management Framework

Enterprise Risk Management Framework

The internal control system is regularly tested and reviewed by Independent Internal Auditor. The independent internal auditor is appointed by the Audit Committee of the Board. All possible measures are taken by the Audit Committee to ensure the objectivity and independence of the Internal Auditor, including quarterly one on one discussions. The company also has a management audit team which carries out internal control reviews and follow-up audits. The team is also responsible for monitoring implementation of action points arising out of internal audits. There is robust process to drive adjacencies arising from audit to ensure proactive control across Marico group. The internal auditors and management audit team, as part of their audit process, carry out a systems and process audit to ensure that the ERP and other IT systems used for transaction processing have adequate internal controls embedded to ensure preventive and detective controls. The audit process includes validation of transactions on sample basis to check if the operations of the company are conducted in compliance to internal policies and ethical standards defined by the company. The audit report is reviewed by the management for corrective actions and the same is also presented to and reviewed by the Audit Committee of the Board. Internal audits and management reviews are undertaken on a continuous basis, covering various areas across the value chain like procurement, manufacturing, information technology, supply chain, sales, marketing, compliance, and finance with the intent to cover all material business processes and locations under internal audit at least once in every 3-4 years. The internal audit programme is reviewed by the Audit Committee at the beginning of the year to ensure that the coverage of the areas is adequate. Reports of the internal auditors are regularly reviewed by the management and corrective action is initiated to strengthen the controls and enhance the effectiveness of the existing systems. Summaries of the reports and actions taken on audit findings are presented to the Audit Committee of the Board. We have also deployed audit analytics in the domains of sales, procurement, manufacturing, supply chain and employee spends. It helps in continuous control monitoring of control effectiveness and areas where actions are required. The Internal Controls team reviews output of this tool and derives corrective action on timely basis. In order to strengthen control environment, audit analytics will be deployed in other functions of Maricos India operations as well as key international geographies. Deloitte Touche Tohmatsu India, LLP has carried out our internal audit in the year under review. The work of internal auditors is coordinated by an internal team at our end. This combination of our internal team and expertise of a professional firm ensure independence as well as effective value addition and protection.

Internal Financial Controls (IFC)

As per section 134 (5) (e) of Companies Act 2013, IFC means the policies and procedures adopted by company for ensuring:

Accuracy and completeness of accounting records

Orderly and efficient conduct of business, including adherence to policies

Safeguarding of its assets

Prevention and detection of frauds

We have implemented a robust internal financial controls framework within the company. The Internal Financial Controls have been documented and embedded in the business processes. Design and operating effectiveness of controls are tested by the management annually and later audited by statutory auditors. Statutory auditors have issued an unqualified report after checking the effectiveness of these controls.

The management believes that strengthening IFC is a continuous process and therefore it will continue its efforts to make the controls smarter with focus on preventive and automated controls as opposed to mitigating manual controls. The company has robust ERP and other supplementary IT systems which are integral part of internal control framework. The company continues to constantly leverage technology in enhancing the internal controls. On a voluntary basis, our material subsidiary, Marico Bangladesh Limited ("MBL") has also adopted this framework. Over time, we will extend this framework to our other overseas subsidiaries.