Dabur India’s quarterly update highlights that FMCG consumption is demonstrating year-on-year improvement, benefiting from positive macroeconomic indicators. However, the recovery has been gradual, with this quarter experiencing a mild summer and a slightly below-average monsoon.
It mentioned that the delayed festive season this year has postponed festival-related sales, which will now be carried over to the next quarter.
“We expect recovery of consumption in both urban and rural markets in India due to improving macro indicators, increase in government expenditure and positive consumer sentiment,” Dabur said.
The homegrown FMCG major is optimistic about its performance in the upcoming July-September quarter, as it foresees achieving a “mid to high single-digit growth” in its consolidated revenue.
“In India business, Healthcare and HPC segments are expected to grow in high single-digit,” it said in an update for the quarter ending on September 30, 2023.
Nonetheless, it expects the Food and Beverage (F&B) segment to register a revenue “slightly below last year’s figures” due to the influence of a mild summer and a shift in the festive season.
Regarding its international operations, Dabur expressed confidence in a robust performance, with the expectation of achieving double-digit growth in constant currency. This growth is expected to be driven by markets such as the Middle East, Egypt, and Turkey.
Furthermore, it anticipates a “greater expansion in gross margins compared to Q1 FY24,” supported by the easing of inflationary pressures and the implementation of cost-saving measures.
A substantial portion of the gross margin expansion will be allocated towards increasing expenditure on advertising and promotions (A&P).
“Consequently, operating profit is expected to grow in line with revenue and remain steady compared to the same quarter last year,” Dabur said.
Additionally, the company affirmed its dedication to outperforming the industry benchmarks within its business segments and capturing greater market share across its product portfolio.
“We will continue to invest strongly behind our brands, distribution expansion, manufacturing footprint and digitisation initiatives,” it said.
In its quarterly update, Dabur India has offered a comprehensive overview of the performance and demand patterns observed during the period ending on September 30, 2023.
“This will be followed by detailed financial results and earnings presentation once the board of directors of the company approves the consolidated and standalone financial results for the quarter ended September 30, 2023,” it added.