22 hours Ago
Packaged daily essentials maker Dabur said it expects flat consolidated revenue growth in the January-March ’25 period in its quarter update, amid delayed winters, the continued urban slowdown and weakness in general trade. The maker of Vatika hair-care and Red toothpaste added that the India FMCG business is likely to decline in mid-single digits in the fourth quarter. The company said it expects 150-175 bps contraction in margins in the quarter.
“Due to the impact of inflation coupled with operating deleverage, we anticipate Q4 operating profit margins to contract by around 150-175 basis points year-on-year,” Dabur said.Rival Marico, in contrast, said the consumer sector experienced stable demand trends amidst the improving trajectory in rural markets and mixed trends across mass and premium urban segments.Both companies, which rely heavily on rural markets for overall demand, reported quarter updates in exchange filings Thursday.
The FMCG sector saw a combination of consumption and pricing-led growth for the first time in four quarters in the months of October-December last year, research company NielsenIQ had said in its previous quarter update. Rural markets have been outpacing demand in cities, as inflation-hit consumers cut back on discretionary spending or downtraded to lower-priced packs.Noting that overall FMCG volume trends continued to be subdued during the quarter, Dabur said in its management commentary that during the quarter, rural demand continued to be resilient and grew ahead of urban markets.
“In terms of channels, organised trade including modern trade, e-commerce and quick commerce maintained their growth momentum, while general trade continued to be under pressure,” the company said.In contrast, it flagged international markets including the MENA region, Egypt and Bangladesh as likely to post strong performance, leading to robust double-digit growth in constant currency terms for the international business.Marico, on the other hand, said it expects volumes to pick up as the stress on the consumer wallet eases, driven by the seasonal moderation in copra prices from their current unprecedented highs.
“We expect gradual improvement in overall consumption sentiment on the back of moderating retail and food inflation as well as forecasts of a normal monsoon,” said the maker of Parachute and Saffola adding that its the India business posted a sequential uptick in underlying volume growth with improving market shares across key franchises. Among key inputs, copra and vegetable oil prices remained firm at peak levels, while crude oil derivatives remained rangebound. The contraction in gross margin is expected to be largely in line with the preceding quarter, Marico said.
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