Emami Ltd. reported consolidated net profit at Rs 179.99 crore for the July-September quarter of FY24 on November 6, registering a decline of 0.07 percent from Rs 180.13 crore in the same quarter of the previous financial year.
Total revenue of the company came at Rs 864.47 crore, rising 6.23 percent from Rs 813.75crore in the year-ago quarter, the company said in a regulatory filing.
Emami, despite a recent decline in net profit, anticipates improved margins due to moderating inflation. The company's strategy involves building new brands and enhancing core brand equity through multiple channels, including modern trade, e-commerce, and general trade.
Earnings before interest, tax, depreciation and amortization (EBIDTA) for the quarter was at Rs 234 crore growing by 20 percent. EBIDTA margin improved by 300 basis points YoY. One basis point is one-hundredth of percentage point.
The company has invested in a 26 percent equity stake of Axiom Ayurveda Pvt Ltd on September 29. Additionally, Emami has revealed its entry into the juice segment with the brand 'AloFrut,' which is currently marketed by Axiom and offers beverage products. The partnership is expected to enhance its market presence across various trade channels.
“In this dynamic and challenging environment, our results exemplify our dedication to growth and innovation, marked by a good increase in both volumes and revenues. Strong performance by both Modern Trade and e-commerce has led to a decent revenue growth of 6 percent and an impressive constant currency growth of 16 percent in our international business during this quarter." said Harsha V Agarwal, Vice Chairman and Managing Director.
In the reviewed quarter, the company's Domestic Business showed commendable 4 percent growth, primarily driven by a 2 percent increase in volume. This growth was particularly prominent in urban markets, including Modern Trade and E-commerce. The International business expanded impressively by 12 percent, translating to a constant currency growth of 16 percent, largely due to strong performances in the SAARC and MENAP regions.
During the quarter, the company introduced several innovative digital-first products in the Domestic business, such as Glycerine bathing bars in the BoroPlus range, an Organic Onion hair mask under the Kesh King brand, and 10 new products on the Zanducare portal. In the international markets, the company launched three new products under the Creme 21 brand. Additionally, the company ventured into the juice category with its investment in Axiom Ayurveda Pvt Ltd, acquiring a 26 percent equity stake. Axiom markets "AloFrut," which offers refreshing and healthy combinations of aloe vera pulp and fruit blends.
The company's prudent approach to managing raw material costs, combined with judicious price adjustments, resulted in a remarkable 350 basis point expansion in Gross margins, reaching 70.1 percent. EBIDTA for the quarter increased significantly to Rs 234 crore, reflecting an impressive 20 percent growth, with margins at 27.0 percent, an increase of 300 basis points.
Recognizing the Company's strong performance, the Board of Directors declared an interim dividend of 400 percent, amounting to Rs 4 per share for FY24. This decision rewards the shareholders for their support and trust. The company's ability to navigate challenges and achieve significant growth and profitability underscores a promising trajectory, highlighting its commitment to innovation, strategic partnerships, and value creation for stakeholders.
"With the Government's support creating favorable conditions in
rural markets, we're poised for a strong second half, amplifying our market presence.” said Mohan Goenka, Vice Chairman and Whole-Time Director.
Shares of Emami closed at 2.34 percent higher at Rs 520.70 on NSE.
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