India's Marico beats Q1 profit estimates on cooking, hair oil demand
05/08/2024 (Reuters), Chennai/Bengaluru - India's Marico (MRCO.NS), opens new tab, which owns the Saffola and Parachute packaged oil brands, reported a slightly bigger-than-expected increase in first-quarter profit on Monday, helped by steady demand and said its earnings would grow this year.
The company's consolidated net profit rose 8.7% to 4.64 billion rupees ($55.4 million) in the April-June quarter, just above analysts' average estimate of 4.63 billion rupees, according to LSEG data.
Total revenue from operations increased 6.7% to 26.43 billion rupees, marking its biggest growth in more than two years. Revenue from India, which made up three-fourths of total revenue, climbed 7.4%.
For Marico, sales volumes for both cooking and hair oils increased in the quarter. While the Parachute hair oil business was helped by higher prices, its Saffola cooking oil business benefitted from price cuts.
Revenue growth will "trend upwards" on higher sales volumes, including in the international business, with earnings also increasing this financial year, Marico said in an investor update.
The company's shares were up 2.1% at 676.6 rupees at 14:05 IST, taking their gains for the year to more than 23%.
Branded cooking oil sellers in India, including Fortune-owner Adani Wilmar (ADAW.NS), opens new tab and Ruchi Gold-owner Patanjali Foods (PAFO.NS), opens new tab, typically book higher profits when edible oil prices are stable, according to industry executives.
Last month, both companies posted solid profits, also citing a stability in edible oil prices.
Overall, though, consumer goods makers have posted mixed results.
Dove soap-maker Hindustan Unilever (HLL.NS), opens new tab reported higher earnings as price cuts boosted demand, while KitKat-maker Nestle India (NEST.NS), opens new tab reported its slowest growth in eight years as price hikes drove consumers away. ($1 = 83.8220 Indian rupees)