Marico Q2 Result: Revenue grows 22% to Rs 2,419 crore, PAT up 8% to Rs 309 crore

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Marico Ltd, #Marico Q2 results, #Results

EBITDA margins for the quarter came in at 17.5 percent, down 210 bps y-o-y while EBITDA was up 9 percent y-o-y.

Marico Ltd, the FMCG player that owns iconic brands like Parachute and Saffola, on October 28 declared its September quarter results (Q2FY22). It reported a y-o-y growth of 22 percent in its consolidated revenue at Rs 2,419 crore from Rs 1,989 crore reported last year.

On a sequential basis, revenue declined 4 percent from Rs 2,525 crore reported in the previous quarter.

The company also witnessed a growth of 8 percent in profit after tax (PAT) at Rs 309 crore during the period against Rs 285 crore (excluding extraordinary items) logged in the year-ago quarter.

Its India business witnessed a volume growth of 8 percent from last year while the y-o-y growth in international markets on a constant currency basis came in at 13 percent.

Commenting on the growth, the company in its statement said, with the ease in COVID restrictions, macro indicators were supported by rising mobility, healthy demand trends were witnessed across majority of its product portfolio which comprises 90 percent of daily-use items. The company witnessed a pick-up in demand in discretionary and out-of-home consumption segments as well. Traditional trade stayed firm on a high base. The growth in rural markets exceeded the y-o-y urban growth but it slowed down sequentially. Alternate channels grew in double digits and CSD recovered smartly on a low base.

The company was able to improve its gross margins sequentially by ~140 bps, but the margins declined ~560 bps on a y-o-y basis due to the rise in edible and crude oil prices. The cost of materials consumed as a percentage of sales, grew 500 bps from 51 percent last year to 56 percent this quarter which led to margin erosion for the company.

EBITDA margins for the quarter came in at 17.5 percent, down 210 bps y-o-y while EBITDA was up 9 percent y-o-y.

Business Performance

FMCG business witnessed an overall y-o-y growth of 22 percent with India business growing by 24 percent and International business by 14 percent. Within India business, Parachute Coconut Oil business grew by 18 percent in terms of value. Saffola brand comprising edible oils and foods grew smartly by 46 percent in value terms. The third segment, Value Added Hair Oils, grew by 16 percent during this quarter compared to last year.

Parachute brand market share grew by 1.8 percent in terms of volumes in this quarter.

The growth in Saffola refined edible oils was subdued mainly due to lower pick-ups by stockists and partly due to lower in-home consumption. On the other hand, Saffola foods witnessed robust y-o-y growth of ~70 percent in value terms with all products in the portfolio (Oats, Honey Soya Chunks, etc) contributing strongly.

Value-added hair oils business grew with the increase in volumes and gained 40 bps market share during the quarter.

The Premium Personal Care portfolio, comprising Premium Hair Nourishment and Male Grooming, had its best quarter since the onset of the pandemic and the Beardo franchise will cross Rs 100 crore turnover by this financial year-end.

International business

The turnover of this business came in at Rs 549 crore (USD 74 million) which works out to a y-o-y growth of 14 percent and constant currency growth of 13 percent. The operating margin improved by 80 bps this quarter to 24.1 percent compared to last year.

The Bangladesh business grew by 16 percent on an annualised basis. The Middle East and North Africa (MENA) grew by 20 percent in a constant currency y-o-y basis, though it was on a relatively low base. South Africa and South East Asia grew by 8 percent and 2 percent respectively in constant currency.

Outlook on input costs and near term

The company expects the inputs costs to remain firm in the near term. Rice Bran Oil was up 59 percent y-o-y and 7 percent q-o-q. Crude derivatives of Liquid Paraffin (LLP) and HDPE were also up 30 percent and 26 percent y-o-y and are expected to maintain the same levels. The company expects some correction in vegetable oil prices in the coming quarters once the benefit of reduction of import duty starts kicking in.

Commenting on outlook for the coming quarters, the company said, “we expect to deliver double-digit revenue growth in the domestic business on the back of mid-single-digit volume growth in H2. This will also translate to a healthy double-digit 2-year CAGR in volume terms. However, we believe high-single digit volume growth is possible in Q4, if consumption trends do not worsen.”

It further added that, “we expect gross margin to improve sequentially in Q3 and Q4. However, we expect an improvement in operating margins to play out only in Q4, given that ad spends will rise from Q3 itself and a large part of the benefits of the second round of cost rationalisation measures will start accruing in Q4.”


The company declared an Interim Equity Dividend for the Financial Year 2021-22 of Rs 3/- per equity share of Re 1 each. The record date for the said interim dividend shall be Tuesday, November 9, 2021, and it will be paid on or before Friday, November 26, 2021.

The stock closed at Rs 564.35, down Rs 11.1 (-1.93 percent) from its previous close. The stock is up 55 percent in the past 1 year, up 40 percent in this financial year and 6 percent up in the past 3 months. In the past 1 month, the stock is up 2 percent.

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