Amid one-off investment value impairment, Dabur Q2 net up 7% at Rs 404 cr

Homegrown FMCG major Dabur India on Tuesday reported 6.91 per cent increase in consolidated net profit at Rs 403.64 crore for the quarter ended September 30.

The company had posted a consolidated net profit of Rs 377.55 crore in the same quarter last fiscal, Dabur India said in a regulatory filing.

The net profit was impacted by one-time impairment in value of investments to the tune of Rs 40 crore, the firm said.

Revenue from operations stood at Rs 2,211.97 crore as against Rs 2,124.97 crore in the year-ago period, a growth of 4.09 per cent, it added.

Commenting on the financial performance, Dabur India Chief Executive Officer Mohit Malhotra said the domestic business continued to face heavy headwinds in the form of a sustained slowdown in demand, aggravated by the liquidity crunch in the market.

"While we continue to face macroeconomic headwinds, Dabur has efficiently managed the risks and challenges to deliver a steady performance," he said.

The increased investment behind brands and in innovation is clearly paying off with Dabur brands growing ahead of the categories and gaining market share, despite the tough operating conditions, Malhotra claimed.

Dabur continues to focus on brand-building across key categories while leveraging on its strong herbal and Ayurvedic heritage, he said, adding the company also continued to expand its distribution expansion strategy in rural India.

"During the second quarter of 2019-20, we have expanded our rural footprint to over 51,000 villages, up from 48,000 villages in June 2019. Riding on this expansion, rural demand continues to grow ahead of urban demand for Dabur," Malhotra said.

The company said its Board of Directors of has declared an interim dividend of 140 per cent for 2019-20.

"Continuing with our payout policy, the Board has declared an interim dividend of Rs 1.40 per share, aggregating to a total payout of Rs 298.25 crore, including tax," Dabur India Ltd Chairman Amit Burman said.