Marico, the consumer goods company known best for its Parachute hair oil, reported a lower than expected quarterly net profit on Wednesday, bogged down by rising cost of raw materials like copra.
The company’s net profit of Rs 183.2 crore for the quarter ending March 31, albeit an increase of 7.2% from last year, was below the Reuters consensus estimate of Rs 200 crore.
“The year was marked by reformed disruptions in a challenging input cost environment. We had a mixed year as we faced short-term headwinds in some of the portfolios due to a combination of internal and external factors,” said Saugata Gupta, MD & CEO, Marico.
Marico’s quarterly revenue saw an 11.7 % increase to Rs 1,502.97 crore from Rs 1,344.43 crore recorded in the same period last year. The company’s India sales, which account for bulk of its business, grew by a modest 1% in volume.
Forecast for a regular monsoon this year and an expected increase in rural government spending, Marico says, could, however, revive its India sales, especially in the rural market. Gupta cites its “bias for franchise expansion” as another reason for optimism.
Marico’s international business though was a silver lining, recording a constant currency growth of 16% for the quarter.
The company’s net profit for the full financial year was Rs 827.45 crore, as against Rs 810.97 crore the year before. The company recorded a total revenue of Rs 6,417.72 crore for the year.
Marico’s shares were trading at Rs 316.9 at closure at the Bombay Stock Exchange, down by more than 4%. The company was founded by Harsh Mariwala in 1990 after breaking away from the family business of Bombay Oil Industries.
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