Shares of Godrej Consumer Products Ltd slumped as much as 7% today after the FMCG player reported an 8.7% decline in the consolidated net profit for the April-June quarter of the FY 2018. The company attributed the weak profit to low sales after GST and higher expenses. Yesterday also the shares fell 2% just after the company announced its first quarter earnings.
The stock of Godrej Consumer Products tumbled 7.79% to the day’s low of Rs 956.4 while the shares have lost over 9% from the Friday’s close of Rs 1,053.6 on NSE. The FMCG market player yesterday reported an 8.7% decline in consolidated net profit at Rs 225.17 crore for the quarter to June due to tepid sales post-GST and higher expenses. The company had posted a net profit of Rs 246.65 crore in April-June a year ago.
Net sales during the period under review were up 3.42% at Rs 2,266.69 crore as against Rs 2,191.64 crore of the corresponding quarter of the previous fiscal, the company said in a BSE filing. Total expenses during the period was at Rs 1,998.88 crore, up 6.53%, as against Rs 1,876.23 crore. For the June quarter, the company’s revenue from the domestic market grew 5.35% to Rs 1,196.16 crore, from Rs 1,135.39 crore a year earlier in the same period.
“While sales in April and May were strong, June sales growth dipped due to channel destocking in the run-up to the implementation of the transformative Goods and Services Tax,” PTI reported citing Godrej Consumer Products Ltd’s Executive Chairperson Nisaba Godrej.