Marico, a leading Indian consumer firm, has announced that it expects its consolidated quarterly revenue to grow by approximately 30% year-on-year. This growth is driven by price hikes and increased sales of its premium hair oils. The company’s domestic business has seen underlying volume growth in the high-single-digit percentage range, with its Saffola brand of cooking oils and Parachute brand of coconut hair oils contributing to about half of its revenue in India.
Despite a slowdown in urban demand, Marico’s packaged cooking oils segment has performed well, with sales growing in the high-teens percentage range. However, the company’s core hair oils segment has seen a decline in volumes due to a 60% price hike, which was necessary to offset surging input costs. On the other hand, premium hair oils have seen growth in the high-teens percentage range.
The company believes that India’s recent tax cuts will have a positive impact on consumer sentiment, with about 30% of its domestic business expected to benefit. Additionally, festive season sales are expected to further improve consumer sentiment. Marico also expects pressure on its gross margin to ease in the October-March period.
The company’s performance is notable, given the current slowdown in urban demand that has affected other consumer conglomerates. Marico’s ability to navigate this challenging environment and deliver growth is a testament to its strong brand portfolio and pricing power. As the company looks ahead, it is well-positioned to capitalize on the expected improvement in consumer sentiment and deliver continued growth and profitability.
Overall, Marico’s quarterly revenue growth of 30% is a positive indicator of the company’s performance, driven by its premium hair oils and packaged cooking oils segments. With the expected easing of pressure on its gross margin and the positive impact of tax cuts and festive season sales, Marico is well-placed to deliver continued growth and success in the future. The company’s strong brand portfolio and pricing power will be key factors in its ability to navigate the competitive consumer goods market and deliver value to its shareholders.