Marico's Stock Dips Over 4% as Q2 Volume Growth Slows

5 Oct 2023 , 01:40 PM

Marico’s stock price dropped over 4% in early trading due to reported low-single digit volume growth in Q2 2023. In Q2 FY24, domestic volumes showed low-single digit year-on-year growth, with similar figures for Parachute Coconut Oil and Saffola Edible Oils, and low single-digit value growth in Value Added Hair Oils.

Marico attributed these trends to factors like rising food prices and irregular rainfall distribution affecting rural demand, but expects improvement in H2. The International business maintained double-digit constant currency growth despite a volatile global operating environment.

On a consolidated basis, revenue saw a marginal YoY decline in Q2FY24 due to pricing corrections and currency depreciation. Key inputs such as copra and edible oil prices remained favorable, and the company anticipates robust gross margin expansion.

Marico increased advertising and promotion spending for brand building and expects healthy operating profit margin expansion. The company aims to maintain performance improvement in H2, with the full-year margin guidance unchanged. Marico remains committed to sustainable, volume-led growth driven by core franchises and new growth engines.

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