Dabur Q2 results: Net profit rises 5.1% to Rs 515 cr, ad spends grow 42.6%

Indian FMCG major Dabur on Thursday reported a 5.1 per cent increase in net profit from the year-ago period to Rs 515.1 crore in the second quarter ended September 30, on the back of category-leading growth from its key brands.

Analysts, on average, had expected a profit of Rs 513 crore, according to LSEG data.

It had reported a net profit of Rs 490.1 crore in the same period last year. The company recorded a volume growth of 3 per cent.

The maker of Hajmola and Real fruit juice reported a 7.3 per cent increase in net sales at Rs 3,203.84 crore from Rs 2,986.49 crore in the same period last year.

“This was driven by steady performance of both the Home & Personal Care and Healthcare business,” the company stated in a release.

The company’s Digestive business, riding on steady performance of its flagship brand Hajmola, grew by 18.1 per cent, while the Home Care business reported a 15.1 per cent growth.

“While unseasonal rains in our key North Indian markets impacted the beverage business during the quarter, the Foods business ended with a 40.4 per cent surge. The recently acquired Badshah brand reported a 16.4 per cent growth during the quarter,” stated the release.

Its PBIDT (profit before interest, depreciation, and tax) was up 7.5 per cent to Rs 778 cr from 723.7 crore from the year ago period. Meanwhile, ad spends in the quarter marked a 42.6 per cent growth in the consolidated business.
 

“We have delivered steady revenue and double-digit operating profit growth with improvement in gross margins led by moderating inflation. We believe we are on the right path with our strategic playbook. We remain focused on managing our business with agility, leveraging our strong distribution footprint while enhancing our margins, quarter after quarter,” said Mohit Malhotra, chief executive officer, Dabur India, in the earnings release.

“We have witnessed a marked sequential improvement in urban demand, led by new-age channels,” he further said, while adding, “While the rural growth still lags urban demand, the gap has reduced. We are increasingly optimistic of the future as we are seeing green shoots of recovery in rural sentiments. We will continue to invest behind our brands, distribution infrastructure and innovation to deliver volume-led profitable growth.”

Dabur's international business continued its growth momentum with a 23.6 per cent jump in constant currency terms in the July-September quarter.

The company also declared an interim dividend of Rs 2.75 per share, aggregating to a total payout of Rs 487.31 crore.