Despite an above-average monsoon, near-term factors like declining rural wages and unemployment pose challenges to rural demand, said Gautam Kamath, Chief Financial Officer, Gillette India. But other than these, he sees positive trends in consumption finally emerging, with both rural and urban demand showing improvement.
"Rural demand is expected to be up, thanks to positive trends. However, we need to watch out for declining rural wages and rising unemployment, though they should stabilise due to the recently-announced interventions of the government. But in the near term, we anticipate the challenges will continue," said Kamath in an investor call on August 18, post its Q4FY24 results. The company follows a July-June financial year.
The company continues to lead in market share and growth in the blade and razor segment. Its grooming category, responsible for 80 percent of the company's sales, grew in mid-single digits in FY24 and currently stands at approximately Rs 3,300 crore, said Kamath.
Grooming and oral care leading growth
Gillette expects the grooming category in India to continue growing in mid-single digits — in line with the overall FMCG market — despite increased competition. “We expect oral care category to grow in mid-single digits, in line with the FMCG market,” Kamath added.
The company sees an opportunity in male grooming, with more men preferring beards. Gillette plans to position its premium systems, appliances, and razors to cater to this new set of consumer needs and provide extraordinary grooming experiences. Currently, appliances comprise 2 percent of the category's business in India.
In the female grooming segment, Gillette's Venus brand has grown rapidly, doubling its business over the past five years. The company is confident in growing this category further.
The company reported net sales of Rs 645.3 crore in June 2024 (Q4FY24), up 4.18 percent from Rs 619.4 crore in June 2023. Its net profit was Rs 115.97 crore, up 26.4 percent from Rs 91.75 crore in June 2023, while its EBITDA was Rs 179.11 crore in June 2024, up 20.66 percent from Rs. 148.44 crore in the year-ago period.
Additionally, the company’s productivity interventions have saved over Rs 45 crore last year, which have been ploughed into product improvement.
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