Godrej Consumer Q1 Results: Beat Estimates, Volume Growth at 15%
Godrej Consumer Products Ltd.’s profit rose sequentially beating estimates as revenue rose compared to the quarter ended March and margin remained largely stable.
Net profit attributable to shareholders of the Mumbai-headquartered company rose 13.1% sequentially to Rs 413.66 crore in the quarter ended June, according to an exchange filing. That compares with the Rs 395.5-crore consensus estimate of analysts tracked by Bloomberg.
Godrej Consumer Products volumes rose 15% year-on-year in the April-June quarter.
Revenue rose 6% to Rs 2894.4 crore, compared with the estimated Rs 2,801.4 crore.
Operating profit rose 9.3% to Rs 599.7 crore, against the Rs 565.7-crore forecast.
Margin stood at 20.7% against 20.1%. Analysts had pegged the metric at 20.2%.
“Going forward, we will continue to focus our efforts where the demand is in home care and personal care – in household insecticides, personal wash, hygiene, and hair care,” Nisaba Godrej was quoted as saying in the results release. She added, that the company has a pipeline of innovations and is building its portfolios across price points.
“We will focus on our strategy that is to drive volume growth and drive market share, even with high cost pressures and commodity inflation. We are being very calibrated with price increases,” Godrej told BloombergQuint in an interview.
The company hiked prices across its portfolio to the tune of 9%.
The maker of Cinthol soaps is also strengthening its supply chain operations and distribution networks. It is also ramping up digital capabilities and new channels like e-commerce and chemists.
Godrej Consumer sees a lot of opportunities in e-commerce and modern trade with its premium consumers and has also witnessed high double-digit growth in the chemist channel, it said. Contribution of e-commerce to Godrej Consumer’s India revenue stands at 5%.
Among the consumer goods makers that have so far announced results for the April-June quarter, Nestle India Ltd. and Hindustan Unilever Ltd. saw their margin narrow over the preceding three months as commodity costs rose. Britannia Industries Ltd.’s margin was stable, while Marico Ltd.’s expanded. Dabur India Ltd. saw its revenue rise 11.8% sequentially and its margins expanded despite higher raw material costs.
The company announced that Adi Godrej has stepped down from the board of directors of the company effective Sept. 30 and will continue as chairman emeritus.
“The foundations of our company are very strong, and I am very confident that Nisa and our leadership team will continue to build forward and create even more sustainable, long-term value for all our stakeholders,” Adi Godrej was quoted as saying in the release.
Also, effective Sept. 1, V Srinivasan, the company’s chief financial officer and company secretary, has resigned to pursue opportunities outside Godrej, the company said. It also said that Sameer Shah, Godrej Consumer’s current head of finance and investor relations, will take over as the chief financial officer of the company.
Shares of Godrej Consumer Products declined 3.1% after the results were announced compared with a 0.8% rise in the Nifty 50.
Watch the full interview here: