Marico, one of India’s leading consumer goods companies, announced a 20% growth in reported profit after tax (PAT) for the fourth quarter ended March 31, 2023. The company reported a PAT of Rs 302 crore compared to Rs 251 crore in the same quarter last year. The growth was largely due to a higher ‘other income’, which included a one-time gain of Rs 28 crore on the sale of land in one of the overseas locations. The recurring PAT for the quarter was up 12%, the company said.
The company’s India business delivered a turnover of Rs 1,683 crore, which was up 2% on a year-on-year (YoY) basis. The revenue from operations grew by 4% YoY to Rs 2,240 crores with underlying volume growth of 5% in the domestic business and constant currency growth of 16% in the international business. The company also reported that the prospects for a sustained recovery in consumption trends strengthened during the quarter as the sector recorded low single-digit volume growth in Q4 after five consecutive quarters of volume decline. In this context, the India business continued to better the performance of the preceding quarter with an underlying volume growth of 5%.
The company’s volume growth on a 4-year CAGR basis stood at 6%. Marico’s consistent focus on strengthening brand equity across portfolios and execution translated into approximately 90% of the portfolio either gaining or sustaining market shares and approximately 85% of the portfolio either gaining or sustaining penetration, both on MAT basis. Among the sales channels, General trade declined in low single digits, while modern trade and e-commerce grew in double digits. Given the recurring trend, MT and E-com contribution to domestic sales went up to approximately 29% in FY23.
Marico’s gross margin expanded 294 basis points YoY and 247 basis points sequentially. The company’s A&P spends at 9.4% of sales were up 3% sequentially. EBITDA margin stood at 17.5%, up 153 bps YoY. EBITDA was up 14% YoY.
Saugata Gupta, the MD & CEO of Marico, expressed satisfaction with the company’s performance and the improving trends across all performance parameters. He said, “FY23 ended on a reassuring note with improving trends across all performance parameters, accompanied by indications of a gradual sectoral recovery. The domestic business delivered a far more broad-based growth with visibly positive results in the portfolio diversification journey, while the international business continued to reinforce its underlying strength amidst a challenging operating environment.”
Gupta also expressed confidence that Marico’s next year’s growth in volumes, revenues, and earnings would move in the right direction, aided by an evolving portfolio of entrenched and budding franchises, distribution expansion, and adequate investments in market development and brand building.
Marico’s Q4 results are in line with the expectations of analysts, who were bullish about the company’s prospects due to its strong brand portfolio, distribution network, and robust financials. The company’s share price has been on an upward trajectory for the past few months, and these results are expected to provide further impetus to the stock.
Overall, Marico’s Q4 results are a testament to the company’s resilience and ability to weather the challenges posed by the pandemic. With the Indian economy slowly recovering and consumer demand showing signs of revival, the company is well-positioned to capitalize on the opportunities presented by the market.
The Indian consumer goods company, Marico, reported a 20% growth in its profit after tax (PAT) at Rs 302 crore in the fourth quarter ended March 31, 2023, as compared to Rs 251 crore in the corresponding quarter last year. The company attributed this growth to higher ‘other income’, including a one-time gain of Rs 28 crore from the sale of land in one of its overseas locations.
