Marico Q3 Preview: Margins expected to grow 300 bps; PAT seen rising 9% YoY

Marico Q3 Preview: Marico, the Mumbai-headquartered FMCG company, is set to report its December quarter (Q3 FY24) results today (January 29). The company's stock ended the session 1.74 per cent lower at Rs 516 on the BSE.

According to Zee Business Research desk, Marico's consolidated net profit is expected to rise 9 per cent year-on-year (YoY) to Rs 362 crore against Rs 333 crore registered in the year-ago period.

Revenue, however, is expected to remain flat at Rs 2,465 crore as compared to Rs 2,470 crore logged in the corresponding quarter of the previous fiscal. EBITDA, or earnings before interest, taxes, depreciation, and amortisation, is seen rising 11 per cent YoY to Rs 506 crore, while margins are estimated to grow by 300 basis points to 21 per cent during the quarter under review.

Marico Q3 business update

During the quarter, the FMCG sector exhibited similar demand trends on a sequential basis, with urban markets staying steady and rural markets offering little to cheer about.

In addition, constraints on liquidity and profitability in the general trade (GT) channel remained an overhang for the sector, while alternative channels continued to fare well.

"We remain optimistic of a gradual uptick in consumption trends over the next calendar year on the back of improving macro-economic indicators, continued government spending, and conducive consumer pricing across categories in response to a benign input cost environment," the company said in its business update for the third quarter.

Domestic volumes grew in low single digits on a year-on-year basis, with a slight sequential improvement in our core portfolio. Parachute Coconut Oil registered low single-digit volume growth, with loose-to-branded conversions trending positively. Saffola Oils had an optically weak quarter owing to a high base and persistently cautious trade sentiment, even while offtakes remained healthy.

Value-added hair oils posted low single-digit value growth amid sluggishness at the bottom of the pyramid segments of the portfolio. "We stayed on course in our diversification journey as Foods and Premium Personal Care scaled up well in line with aspirations," the company added.