Godrej Consumer Products (GCPL) posted its fiscal first quarter profit at Rs 318.82 crore, down 7.6 per cent in comparison to Rs 345.12 crore during the corresponding quarter of FY23, missing estimates. It posted revenue from operations at Rs 3,448.91 crore, up 10.4 per cent as against Rs 3,124.97 crore during the same period last year. According to CNBC TV18 estimates, GCPL was expected to post a Q1 profit of Rs 428 crore and revenue at Rs 3,600 crore during Q1FY24. The company EBITDA stood at Rs 642.8 crore.
While the company posted a total income during the quarter at Rs 3,518.02 crore, the total expenses during the period stood at Rs 2,956.36 crore. The company sales rose 10 per cent to Rs 3,418 crore from Rs 3,094 crore, led by a volume growth of 10 per cent. “We started the year on a positive note and achieved healthy volume-led sales growth. In organic terms, our consolidated sales increased by 9 per cent year-on-year driven by healthy volume growth of 8 per cent. Sales in constant currency terms increased by 13 per cent,” said Sudhir Sitapati, Managing Director and CEO, GCPL.
Godrej Consumer Products’ Q1 performance across key markets
GCPL’s India business sales grew by 9 per cent to Rs 1,971 crore during Q1FY24, led by volume growth of 12 per cent. While the home care segment grew by 14 per cent, the personal care segment witnessed a growth of 2 per cent. In terms of home care segment performance, household insecticides posted a double-digit volume and value growth and the performance was led by growth in premium brands. Also, air fresheners have been delivering double-digit growth with strong growth in Aer Pocket, Aer Matic and the Car Range. For personal care segment, personal wash maintained its growth momentum, delivering high single-digit volume growth. Magic hand wash delivered strong double- digit volume growth. Hair colour grew in mid-single digits, off a high base with 2-year CAGR in teens, wherein growth was led by steady performance across formats.
“In India, we continued to stay course on our strategy of volume-driven category development and delivered double-digit volume growth of 10 per cent. This performance was broad based with Home Care delivering double-digit volume growth and Personal Care in mid-single digits. Our value growth was lower than volume growth as we passed on the benefits of lower input costs to our consumers,” said Sudhir Sitapati.
GCPL’s Indonesia sales grew by 15 per cent in constant currency terms on the back of structural initiatives taken last year. The EBITDA margins were at 19.5 per cent, up 420 bps year-on-year led by reduction in trade promotions and scale leverage. “We continue to focus on category development initiatives, increase media investments and launch access packs to augment GT distribution,” the company said.
Meanwhile, the company’s Africa, USA and Middle East cluster delivered sales growth of 16 per cent in constant currency terms with healthy double-digit sales growth in the FMCG category.
“Our quality of profits has been improving consistently over the last few quarters with reported consolidated gross margin seeing sharp improvement of 730 bps year-on-year and 80 bps quarter-on-quarter. We remain focused on driving volume-led growth along with healthy investments in our brands and improvement in profitability. We continue to have a strong balance sheet. We are on track in our journey to reduce wasted cost and are deploying this to drive profitable and sustainable volume growth across our portfolio through category development,” said Sudhir Sitapati.
Furthermore, the company board also approved a capital expenditure of Rs 900 crore for setting up a new manufacturing site at Tamil Nadu and Madya Pradesh, in order to cater to the “growing demand of the customers and to consolidate the manufacturing footprint”. The manufacturing sites are expected to come on stream approximately in 18-36 months, the company said in a regulatory filing.