FMCG company Dabur has said that the competition from Baba Ramdev’s rival Patanjali Ayurveda has slackened. However, the company still continues to face the headwinds of demand slowdown and expects the situation to persist for a while.
FMCG company Dabur has said that the competition from Baba Ramdev’s rival Patanjali Ayurveda has slackened. Releasing its quarterly results, Dabur said that the competitive intensity of Patanjali has abated, CNBC TV-18 reported. However, the company still continues to face the headwinds of demand slowdown and expects the situation to persist for a while. “The near-term outlook for demand growth remains challenging with most key categories reporting a steady decline in Value and Volume growth,” Mohit Malhotra, Chief Executive Officer, Dabur, said in a statement on Thursday. Dabur reported a single-digit 7% jump in revenue and double-digit 10.7% growth in operating margin during 3QFY20.
While Patanjali brought stiff competition to both global and desi fast-moving consumer goods companies with its Ayurveda and swadeshi pitch in 2009, the Haridwar-based company has not launched new products in quite some time now. However, Patanjali Ayurveda recently said that it looks to replace current market leader HUL as the biggest FMCG company in India in the coming years, PTI reported. Patanjali is also eyeing a turnover of Rs 35,000-Rs 40,000 crore by the next financial year, Yoga Guru Ramdev said earlier this week. By comparison, HUL had posted revenues of Rs 38,224 crore in FY19.
Key takeaways from Dabur Q3 results
- Dabur’s consolidated revenue stood at Rs 2,353 crore in Q3FY20, witnessing an increase from Rs 2,199 crore a year earlier.
- The company’s consolidated net profit increased 8.7% and stood at Rs 397.7 crore, up from Rs 366.1 crore during the comparable period in FY19.
- However, Dabur’s net profit was impacted by one-time impairment of Rs 20 crore in value of investments.
- Excluding the impairment, Dabur’s net profit witnessed a 12.8% growth on-year.
- The domestic business witnessed an underlying volume growth of 5.6% during Q3.
- The international business expanded by 11.7% during quarter three of 2019-20.
- Dabur’s Chyawanprash range drove the company’s Health Supplements business, which increased by 12.2% during the quarter.