Emami rises after strong Q1 results

Emami gained 2.97% to Rs 317 at 12:45 IST on the BSE after consolidated net profit jumped 47% to Rs 39.12 crore on 5.57% rise in net sales to Rs 648.64 crore in Q1 June 2019 over Q1 June 2018.

The result was announced during the market hours today, 8 August 2019.

Meanwhile, the S&P BSE Sensex was up by 133.74 points or 0.37% at 36,825.69.

On the BSE, 44000 shares were traded in the counter so far compared with average daily volumes of 12000 shares in the past two weeks. The stock had hit an intraday high of Rs 319.2 and an intraday low of Rs 300.45 so far during the day. The stock hit a 52-week high of Rs 586.05 on 8 August 2018 and a 52-week low of Rs 246 on 24 June 2019.

Earnings before interest tax depreciation and amortization (EBITDA) grew 11% to Rs 134 crore in Q1 June 2019 as compared to Rs 120.4 crore in Q1 June 2018. The EBITDA margin stood at 20.7% in Q1 June 2019.

The June quarter witnessed challenges in terms of adverse economic conditions such as channel liquidity issues and muted rural incomes which coupled with a high base in Q1 June 2018 impacted growth levels in the domestic business.

During the quarter, both Kesh King and 7 Oils continued to post robust growth, while Navratna grew satisfactorily. However, muted performance of pain management, male grooming, BoroPlus and healthcare range led to lower growth in the domestic business. While, key brands like Navratna, Zandu & MenthoPlus balms, Kesh King and BoroPlus continued to gain market shares, Fair and Handsome maintained its leadership.

International Business grew by 34% during the quarter led by a strong performance in SAARC and MENAP regions.

Commenting on Q1 performance Mohan Goenka, Director, Emami said, We are happy to report a healthy profit-led growth this quarter with revenues growing by 6% and PAT growing by 47%. Despite input cost pressure, EBIDTA margins expanded by 110 bps. However, the macroeconomic environment continues to be challenging, with a distinct slowdown in the consumer demand curve particularly for discretionary products. Despite such challenges, we are satisfied with the performance of Kesh King, Navratna, 7 Oils in One and international business this quarter. With the stabilization of raw material prices and the government impetus to put rural growth on the fast track, we expect business to bounce back in the coming quarters.

Emami is one of India's leading FMCG companies engaged in manufacturing & marketing of personal care & healthcare products.

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