Demand, consumer sentiment weak in Q2, impacted category growth: Marico

FMCG firm Marico on Tuesday said demand and consumer sentiment during the July-September quarter was weak, resulting in slower growth in its categories.

During the quarter, traditional channels both in rural and urban markets faced distress, said Marico, which has brands like Parachute, Saffola and Hair & Care.

In a statement to the bourses, the Mumbai-based company said "soft consumption trends and tight liquidity conditions"' has led to a "much subdued quarter" for its core and some of the new categories of its domestic business.

"The demand and consumer sentiments weakened progressively during the quarter, which manifested in slowing category growths," it said in an overall summary of the operating performance and demand trends witnessed in the quarter ended September 30, 2019.

"Further, liquidity challenges led to some correction in trade inventories and exerted pressure on channel partners investments and returns," it added.

However, the alternate channels, which include modern trade and e-commerce, stayed on course, it said.

Marico would provide detailed information update once its board approves the financial results for second quarter of FY20.

"Despite the uninspiring narrative around the economy prevailing, we hope for some recovery in overall sentiment in the second half (of the fiscal) on the back of good monsoons and government-led stimulus," the company said.

Marico had reported a revenue of Rs 5,971 crore in FY 2018-19.

In the June quarter, the company had reported a revenue of Rs 1,777 crore along with a net profit of Rs 251 crore.