Even while the Fast Moving Consumer Goods industry is reeling under agrarian distress and resulting consumer slowdown, Dabur’s domestic FMCG business reported volume growth of 9.6% during the Q1.
Dabur India has recorded double-digit profit growth in Q1 volumes despite slowdown and stiff competition, Dabur announced in a press release. While the macroeconomic environment continues to be challenging amid overall demand slowdown in India and high competitive intensity, Dabur has executed well on distribution expansion strategy in rural India, Dabur CEO Mohit Malhotra said, adding that the same has resulted in consistent improvement of its performance. The company has also witnessed higher rural demand than urban. Dabur’s consolidated net profit spiked by 10.3% to Rs 363 crore, up from Rs 329 crore in the same quarter last year.
The leading FMCG brand has gained market share across categories like Health Supplements, Hair Care, Oral Care and Foods, it said. The company’s chief executive officer said that the focus on the Consumer Health space and disproportionately higher investments behind Dabur’s Power Brands have started paying dividends. Even while the Fast Moving Consumer Goods industry is reeling under agrarian distress and resulting consumer slowdown, Dabur’s domestic FMCG business reported a volume growth of 9.6% during the Q1. Rural India contributes to 37% of overall FMCG spends, according to Nielsen FMCG snapshot for April-June 2019 quarter.
Meanwhile, the company has also rejigged its management and Amit Burman has been appointed Chairman of Dabur India Ltd. His former position as Vice Chairman of the company has been handed over to Mohit Burman. Aditya Burman will now serve as a non-executive additional director on the board. Dabur’s former Chief Executive Officer Sunil Duggal has stepped down from the board with effect from Friday.
Key takeaways from Q1 results
Dabur’s total expenses have risen by 7.50%. While the current expenses stand at Rs 1,883.65 crore, the same were Rs 1,752.17 crore previously. Dabur has also recorded consumer care business growth by 11.38%. During the quarter under review, it posted the same at Rs 1,844.60 crore as against Rs 1,656.08 crore of the corresponding quarter. However, Dabur did not show considerable growth in its food business with a marginal growth of 0.77% to Rs 366.32 crore.