Dabur India Q2FY23 Preview: Revenue may grow in single digits; margins likely to see pressure – check expectations

Fast-moving consumer goods company Dabur India is expected to post mute July-September quarter earnings for the financial year 2022-23 (Q2FY23) on Tuesday, October 25, 2022, according to Zee Business channel research. 

The FMCG major’s top line may show year-on-year (YoY) growth, while the bottom line may fall marginally YoY, similarly, even margins are expected to come under pressure,

Dabur India’s revenue may surge by 6 per cent to Rs 2997 crore (estimate) in Q2FY23 as compared to Rs 2818 crore reported in the corresponding quarter of the previous fiscal. While its profit may dip by 3 per cent to Rs 491 crore (estimate) in the September-end quarter against Rs 505 crore YoY. 

Even, Dabur’s EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortisation) is seen declining YoY by 3 per cent to Rs 605 crore (estimate) as compared to Rs 620 crore in Q2FY22. And, margins may be slipped by 200 points to 20 per cent (estimate) from 22 per cent YoY. 

The muted performance by the FMCG company is expected due to the high base in healthcare and weak demand across categories due to inflation.

Almost in line with Zee Business expectations, Street believes Dabur is likely to report 7.6 per cent revenue growth during the quarter. However, the high cost of raw material inventory would continue to adversely impact gross margin and estimate 226 basis points contraction in gross margins.  

Shares of Dabur India on Monday (Muhurat Trading) closed flat with a negative bias, down around 0.5 per cent to Rs 535 per share on the BSE as compared to a 0.88 per cent rise in the S&P BSE Sensex.