Q3 Results Of FMCG Companies Are a Mix Bag In the third quarter, FMCG companies show resilience in navigating the complexities of the sector
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According to market research firm Nielsen IQ, in the December quarter, the FMCG industry garnered a 6 per cent value on the back of 6.4 per cent volume growth (6.1 per cent higher y-o-y). The Q3 results of FMCG companies in FY24 indicate resilience in navigating the complexities in the industry. Muted growth on the back of a high base, some price cuts, high competition and low volume growth are the current challenges.
Britannia Industries reported a 40 percent fall in its consolidated net profit at INR 556 crore for the quarter ended December 31, 2023. The company had reported a net profit of INR 932 crore in the year-ago period. Sequentially too, Britannia's profit slipped 5 percent from INR 587 crore.
Revenue from operations rose marginally to INR 4,256 crore from INR 4,196 crore in the same quarter last fiscal. Commenting on the performance, Varun Berry, Vice Chairman & MD, said, "In a progressively recovering demand environment with heightened competition, our performance this quarter reflects our resilience and competitiveness. On the cost & profitability front, we will stay vigilant of the commodity prices and evolving geopolitical situation. We will continue to invest behind our brands and stay price competitive with a clear objective of driving market share while sustaining profitability. We remain committed to the ESG framework of people, growth, governance and resources to build a sustainable and profitable business."
Godrej Consumer Products Ltd
Godrej Consumer Products Ltd (GCPL) reported a consolidated profit after tax of INR 581 crore in the third quarter ended December 31, 2023. The company had posted a consolidated profit after tax of INR 546 crore in the same period last fiscal. "We continue to deliver steady performance in Q3FY24 despite challenging market conditions. We are on track in our journey to reduce wasted cost and are deploying this to drive profitable and sustainable volume growth across our portfolio through category development," said Sudhir Sitapati, Managing Director, and CEO at GCPL.
Riding on the strength of its consumer-focused product portfolio, brand communication and excellence in go-to-market execution, Dabur continued to build and sustain its growth momentum, posting category-leading growths with market share gains across the portfolio. Despite the delay in onset of winters slightly impacting the Healthcare and Winter portfolio, Dabur's India Business ended the third quarter with a Volume Growth of 6 per cent. The company reported a consolidated net profit INR 514.2 crore compared with INR 476.7 cr (YoY) during the quarter under review, recording a growth of 8 per cent. Its revenue from operations was up 7 per cent at INR 3,255.06 crore, it was at INR 3,043.17 crore in the corresponding quarter of the previous fiscal.
"Moderating inflation coupled with buoyant consumer sentiments and our focussed investment in distribution footprint expansion in rural India helped demand from the hinterland bounce back for Dabur," said Mohit Malhotra, CEO, Dabur India.
Nestle India reported a net profit of INR 655.61 crore for the quarter ended December 31, 2023, up 4 per cent compared with INR 628.06 crore recorded in the year-ago period. The company's revenue from operations stood at INR 4,600.42 crore, up 8.07 per cent against INR 4,256.79 crore registered in the corresponding quarter of the previous fiscal. The quarter was marked by an increase in brand investments across all product groups and all key brands, product groups have contributed to Nestlé India's consistent growth trajectory.
Commenting on the results, Suresh Narayanan, Chairman and Managing Director of Nestlé India said, "I am pleased to share that, despite external challenges, we have once again delivered a strong performance this quarter. Domestic sales grew by 8.9 per cent on the back of pricing and mix growth, with strong growth momentum in e-commerce and out-of-home channels. I am also pleased to note that during the year 2023, our total sales grew by over 13.3 per cent and we crossed the INR 19,000 crore mark."
However, as challenges persist, the FMCG sector can witness a growth rate ranging between 4.5 per cent and 6.5 per cent in 2024, signifying a significant deceleration from the robust 9.3 per cent growth in 2023, Nielsen IQ added in its report.