Marico reports positive revenue growth in Q4 after three quarters; stock jumps

Consolidated revenue grew in low single digits, Marico said, which moved back into positive territory after three quarters, due to incremental anniversarizaton of pricing cuts in key domestic portfolios.

The company expects consolidated revenue growth to trend upwards from here on, with domestic revenue growth outpacing volume growth in the quarters ahead.

In Q4, the domestic business posted a marginal volume uptick on a sequential basis owing to steadying trends in the majority of the portfolios.

Parachute Coconut Oil registered low single-digit volume growth as the company witnessed a continuing revival in loose to branded conversions amidst firming up of copra prices, which was along expected lines.

Meanwhile, Saffola Oils delivered mid-single-digit volume growth as trade-led headwinds subsided with input and consumer pricing exhibiting stability.

Value added hair oils, on the other hand, had an optically weak quarter, declining on a high base amidst persistent sluggishness in the bottom of the pyramid segment.

Foods continued its steady run to close the year at 4x of its scale in FY20 and digital-first brands also sustained its strong growth trajectory, thereby meeting Marico's stated portfolio diversification objective for the year.

"Amidst the backdrop of improving macro-indicators, we expect a gradual uptick in the growth of our core categories through the ongoing initiatives to enhance the profitability of our general trade (GT) channel partners and focused investments towards a transformative expansion in our direct reach footprint across urban and rural outlets over the next couple of years," the company said in a statement.

Marico said it will continue to focus on driving differential growth in the urban-centric and premium portfolios through organised retail and e-commerce channels.

It will also seek to aggressively diversify the portfolio through the scale up of foods and digital-first brands and improve profitability parameters in line with our medium-term strategic priorities.

In the March quarter, the international business reverted to clocking double-digit constant currency growth, led by Bangladesh bouncing back from transient headwinds and the rest of the markets maintaining their positive momentum.

Marico also expects a strong gross margin expansion on a year-on-year basis.

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