 "Dabur")
Dabur’s business update for Q3FY26 indicated mid-single digit consolidated revenue growth. The guidance is that growth in operating and net profits will beat revenue growth.
In the domestic business, home and personal care (HPC) revenue grew in double digits, while healthcare is likely to post a sequential growth in low-single digits.
International business is expected to post near double-digit growth in rupee terms.
The update is on the lower side of earlier guidance of mid-to-high single digit revenue growth in H2FY26.
At a category level, HPC growth has done better while healthcare and beverages are below consensus.
The HPC growth may be driven by hair oils and oral care. Much of the portfolio outpaced category growth so there should be market share gains.
Healthcare growth will be driven by Dabur Honey, Honitus and health juices, which are estimated to have grown 15 per cent year-on-year (Y-o-Y).
Hajmola and Ethicals could see mid-single digit growth.
While primary sales growth for Chyawanprash is muted, secondary sales are positive and a pickup is expected in Q4FY26.
There was volume-led growth of the Dabur Amla franchise, Dabur Almond, Dabur Anmol, Dabur Red Toothpaste and Meswak.
In foods & beverages (F&B), the culinary business will record double-digit growth. In beverages, nectars and drinks, it will be a muted performance due to adverse seasonality. But the brand’s focus on the premium ‘Real Activ’ range is working with this portfolio to report growth of over 30 per cent in most products.
“Real” beverages may have seen market share gains.
In terms of distribution, organised trade channels maintained growth momentum while ecommerce and quick commerce (clubbed together) are expected to grow in double digits.
Dabur did not comment on modern trade growth, as it may have been impacted.
Overseas, key markets like the Middle East and North Africa (MENA), Turkey, and Bangladesh have performed well.
US-based Namaste hair care brand, which Dabur acquired in 2010, also did well.
Overall, overseas business is expected to post low double-digit growth in rupee terms.
In October 2025, there was extensive inventory liquidation as GST 2.0 kicked in.
Since then, consumer sentiment has improved in both urban and rural but rural rebound is stronger.
The management expects favourable macroeconomic conditions and tax reforms to support demand recovery.
The diversified portfolio of HPC and food, offers leadership, especially in the natural and ayurveda ranges.
Around 74 per cent of its sales were domestic in FY25.
In India, F&B accounted for 13 per cent of sales in FY25. And, it has been growing fast with 16 per cent revenue growth in the last five financial years (FY20-25).
Healthcare saw strong revenue growth during the pandemic, but since then it has had a flat 4-year annual growth.
Healthcare contributed 29 per cent of domestic and 21 per cent of consolidated sales in FY25.
Weak growth here must be seen in the context of low Street expectations, but it is also despite a low base Y-o-Y and a cold winter and that may disappoint some investors.
Dabur highlighted that it expects HPC to have grown in double-digits – slightly better than Street expectations.
In oral care, Dabur has gained market share.
The company has faced growth challenges in the last 4-6 quarters. Guidance has been cut, and it has missed consensus estimates, leading to derating of valuation multiples.
A strong rural rebound and a pick-up in flatter categories like beverages could generate an upside.
A favorable resolution of running Namaste litigation would also be a positive.
But sustained weakness in hair-oil, health supplements and beverages categories could be a concern. Analyst reaction seems to be positive.
