Patanjali Foods on Friday posted its fiscal first quarter profit at Rs 87.75 crore, down 63.6 per cent as against Rs 241.26 crore during the corresponding quarter of FY23. It posted revenue from operations at Rs 7767.10 crore, up 7.7 per cent in comparison to Rs 7210.97 crore during the first quarter of FY23. The company EBITDA stood at Rs 168.6 crore, down 57 per cent on-year. Patanjali posted a total income of Rs 7810.50 crore during the quarter in review, up 6 per cent from Rs 7370.08 crore during Q1FY23. However, the total expenses posted by the company during the quarter ended June 2023 was at Rs 7691 crore, up 9.3 per cent as against Rs 7037.60 crore during the year-ago quarter.
Patanjali Foods reported a profit decline due to a fall in prices of edible oils, higher expenses and fall in other expenses. The company said that the edible oil industry was impacted by significantly lower prices than the previous quarter due to a sudden fall in prices and this left the industry with high price inventory in hand, as well as stock in transit. It further added that the government intervention for lowering prices in spite of holding high priced inventory impacted the profitability negatively during the quarter.
Patanjali’s edible oil segment recorded sales of Rs 5890.73 crore contributing 74.94 per cent of revenue. It said that despite edible oil revenue degrowth, the sales volume increased by 1.4 lakh mt, registering a growth of 35.80 per cent year-on-year.
“The edible oil industry is known for its inherent volatility which we are counterbalancing by increasing our emphasis on FMCG offerings. The pricing dynamics of edible oil are significantly influenced by a range of macro factors, such as geopolitical situations, wars, and seasonal behaviour,” said Sanjeev Asthana, CEO, Patanjali Foods Limited.
He further added that the impact of the softening of prices has had an impact on the company’s edible oil businesses. “However, by leveraging our supply chain distribution network, we were able to generate large volume turnover for our edible oil business and maintain our share,” he said.
Meanwhile the food and FMCG segment recorded a sales of Rs 1952.46 crore contributing to 24.84 per cent of revenue of the company. The segment recorded an EBITDA of Rs 360.80 crore with an EBITDA margin of 18.48 per cent despite rising inflation levels and macro challenges by managing the costs proactively.The Nutrela premium oil sales growth was at 5738 mt, up 93 per cent on-year. Under biscuits and confectionery, revenue growth percentage was recorded in the mid-thirties. Its marquee brand, Doodh biscuit, recorded ~Rs 225 crore in sales. Further, as part of its premiumization drive, Patanjali launched premium dry fruits under
‘Nutrela MaxxNuts’ brand. Under the nutraceuticals category, it launched ‘Nutrela Sports’ brand for its sports nutrition category with 6 products and 18 new SKUs. The firm also revamped and launched its new D2C website.
“In recent market developments, we have been responding to moderating commodity inflation by implementing price cuts. With the monsoon onset, the demand from rural India is seeing green shoots. Despite the challenges, the growth in the Food & FMCG industry can be attributed to urbanisation, premiumisation and changing lifestyle. Our Food & FMCG segment is performing in line with our targets. We see the Food & FMCG segment to be a major contributor to our revenue as well as margins.” said Sanjeev Asthana.
Patanjali is aiming to gain a position amongst the top three FMCG players in the country within next five years with a turnover of Rs 45,000- Rs 50,000 crore.