Homegrown FMCG major Dabur India Ltd on Wednesday reported a 2.85 per cent decline in its consolidated net profit to Rs 490.86 crore for the second quarter ended September 30. The company had posted a net profit of Rs 505.31 crore in the July-September quarter a year ago, Dabur India said in a regulatory filing.
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However, its revenue from operations rose 6 per cent to Rs 2,986.49 crore during the quarter under review against Rs 2,817.58 crore in the corresponding quarter of the previous fiscal. Dabur India’s total expenses increased 8.94 per cent to Rs 2,471.28 crore in the latest September quarter. The same stood at Rs 2,268.47 crore last year.
Dabur India’s board has also declared an interim dividend of 250 per cent for 2022-23. “Continuing with our payout policy, the Board has declared an interim dividend of Rs 2.50 per share, aggregating to a total payout of Rs 442.94 crore,” Dabur India Chairman Mohit Burman said.
Dabur India Chief Executive Officer Mohit Malhotra said that while the challenging economic environment continued to be a concern and impacted the purchasing power, we are seeing green shoots of recovery with the onset of festive season. “The impact of inflationary pressures was more pronounced in the Rural markets with demand growth in hinterland lagging urban markets for the first time in five quarters.”
He, however, added that the company is hopeful of rural demand reporting a smart recovery in the coming quarters and we are investing ahead of the curve to ride this demand recovery by expanding our rural footprint by adding nearly 9,000 villages in Q2 of 2022-23 to take its total coverage to over 1 lakh villages.
Dabur’s brands continued to grow ahead of the market, gaining market shares across 95 per cent of the company’s product portfolio. Dabur reported a 410 bps market share gain in the Juices & Nectars category, while its share of the digestives category improved 270 basis points (bps).
“Our Chyawanprash market share increased 120 bps and our share of the Shampoo category improved 40 bps. Dabur share of the Hair Oils market increased 20 bps. Innovation continues to be the cornerstone of Dabur’s strategy with new launches contributing to around 4 per cent of sales,” Dabur said in a statement said.
Dabur’s foods & beverages business reported a strong 30 per cent growth. Its beverages business ended the quarter with a jump of over 30 per cent while the foods business reported a 21 per cent growth. The home care business was up nearly 21 per cent, while the toothpaste category, riding on strong performance of our flagship Dabur Red Paste, ended the quarter with an over 11 per cent growth.
Its shampoo and post-wash business ended the quarter up 9 per cent. Dabur’s Ayurvedic OTC business also reported a growth of over 9 per cent during the quarter.
“Dabur’s International Business reported a 12.3 per cent jump in Constant Currency terms, led by strong constant currency growths in Turkey (86 per cent), Nepal (25 per cent) and Egypt (23 per cent),” Dabur added.
Dabur India also said it has signed definitive transaction agreements to acquire 51 per cent shareholding of Badshah Masala Pvt Ltd. The strategic objective of Dabur is to grow its food business to Rs 500 crore in three years and develop into new adjacent categories, which is in line with this acquisition. This also signals Dabur’s debut into the Indian market for branded spices and seasonings, which is worth over Rs 25,000 crore.
With the Badshah company valued at ₹1,152 crore, Dabur is acquiring a 51 per cent stake in it for Rs 587.52 crore, less proportionate debt as of the closing date. According to the estimated financials for FY2022-23, this amounts to a revenue multiple of around 4.5x and an EBIDTA multiple of roughly 19.6x.
Dabur India’s shares on Wednesday fell by 0.93 per cent, or Rs 5.00, to close at Rs 532.10 apiece on the BSE.
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