Emami turns volatile post June quarter results

The stock was trading flat at Rs 1,073, bouncing back 5% from intra-day low of Rs 1,020 on the NSE

Emami was trading flat at Rs 1,073, bouncing back 5% from intra-day low on National Stock Exchange (NSE), after the company said the June quarter performance was impacted due to Goods & Service Tax (GST)-led destocking and inventory correction in the international markets.

Going forward, the company expects to regain the momentum in the balance period of the fiscal.

The stock of the personal products company dipped 5% to Rs 1,020 after the company reported a consolidated net profit at Rs 1 crore against an average analysts estimate of Rs 69 crore in June quarter (Q1FY18). The stock opened nearly 1% higher at Rs 1,080 on NSE.

Net sales during the quarter under review declined 16% to Rs 541 crore against Rs 645 crore in the corresponding quarter of previous fiscal.

Emami said that the quarter is not the representative of the business outlook of the company as it invested aggressively in promotions of new launches, which further impacted the bottomline during the quarter.

The quarter witnessed significant destocking in the domestic market due to implementation of GST and also sizable inventory correction in the international markets. Further, geopolitical conditions in international markets also impacted the business, it added.

Due to such challenges, the consolidated revenues declined by 16%, consequently the profits also reduced. Going forward, the company expects to regain the momentum in the balance period of the fiscal.

The trading volumes on the counter more than doubled with a combined 846,800 shares changed hands on BSE and NSE.