Marico Limited , a leading Indian FMCG company, has reported a 7% volume growth in its India business for the second quarter, despite facing disruptions due to the implementation of revised GST rates in September. The company also witnessed an unprecedented 60% pricing growth in its Parachute brand, driven by copra inflation.

Key Highlights

• 7% volume growth in India business
• 60% pricing growth in Parachute due to copra inflation
• Revenue growth hit multi-quarter highs
• Double-digit EBITDA growth expected in the second half
• Copra prices declined 15% from July peaks
• Maintains Rs. 20,000 crore revenue target by 2030

Financial Performance

Marico's performance in Q2 was marked by steady demand trends in July and August, followed by transitionary disruptions in trade channels due to GST rate revisions in September. Despite these challenges, the company managed to deliver a 7% volume growth in its India business.

The company's flagship brand, Parachute, experienced an unprecedented 60% pricing growth year-on-year, primarily due to significant inflation in copra prices. Despite this substantial price increase, Parachute managed to maintain its market share, demonstrating remarkable pricing power and consumer loyalty.

GST Impact and Strategy

Approximately 30% of Marico's India business benefited from the recent GST rate rationalization. In line with the government's objectives, the company has passed on the benefits of reduced GST rates to consumers across relevant categories, either through price cuts or grammage increases in price point packs. This strategy aims to enhance product affordability and accessibility.

Outlook and Expectations

Marico remains optimistic about its future performance, citing several favorable factors:

1. Easing inflation
2. Supportive government policies
3. Transformative GST reforms
4. Favorable monsoons
5. Healthy crop outlook

These factors are expected to boost disposable incomes and aid consumption across urban and rural markets.

Copra Prices and Margin Outlook

The company reported that copra prices have declined by 15% from their July peaks. Marico anticipates further correction in copra prices by March, which is expected to positively impact margins. As a result, the company expects to deliver double-digit EBITDA growth in the second half of the fiscal year.

Long-term Target

Marico remains confident in its trajectory and expects to make meaningful progress towards its ambitious goal of reaching Rs. 20,000 crore in revenue by 2030.

Saugata Gupta, MD & CEO of Marico Limited, commented on the company's performance, stating, "We have delivered an encouraging performance in the first half with both the Indian and international business progressing in tandem. We remain focused on executing our strategic priorities for the year and expect to sustain the positive growth momentum across India and overseas business in the quarters ahead."

As Marico navigates through the evolving market dynamics, investors and industry observers will be keenly watching the company's ability to maintain its growth momentum while managing input cost pressures in the coming quarters.

Marico , a leading Indian consumer goods company, has announced an ambitious growth strategy that aims to significantly expand its business over the next several years. The company has set forth a comprehensive plan that includes specific revenue targets and margin improvements.

Key Growth Targets

Revenue Ambitions

Marico has set its sights on achieving a revenue of INR 20,000 crores by the year 2030. This target underscores the company's confidence in its growth potential and its ability to expand its market presence over the long term.

Near-Term Objectives

For the current fiscal year, Marico aims for a substantial 25% growth in consolidated revenue. This aggressive target suggests that the company expects significant expansion across its various product lines and markets.

Profitability Focus

Marico is not just focusing on top-line growth but also on improving its profitability. The company plans to enhance its operating margin by at least 200 basis points in the next financial year. This improvement in operational efficiency could potentially lead to better returns for shareholders.

Digital and International Expansion

The company has outlined specific goals for its digital and international segments:

1. Digital Brands: Marico aims to achieve double-digit EBITDA margins for its digital brands business by FY27. This target highlights the company's commitment to its e-commerce and digital-first brands, recognizing the growing importance of online channels.

2. Overseas Operations: The plan includes maintaining robust double-digit constant currency growth in international markets. This suggests that Marico sees significant opportunities for expansion beyond its home market of India.

Domestic Market Focus

While pushing for international growth, Marico has not lost sight of its domestic market. The company expects to see an improvement in India volume growth in the second half of the current fiscal year. This indicates a strategic focus on increasing market share and penetration within India.

Marico's comprehensive growth strategy demonstrates its ambition to significantly scale up its operations across various dimensions - revenue, profitability, digital presence, and geographical reach. The success of this plan will depend on the company's execution capabilities, market conditions, and its ability to innovate and adapt to changing consumer preferences.

Investors and market observers will likely keep a close watch on Marico's progress towards these targets in the coming years, as they could have significant implications for the company's market position and financial performance.