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- 05 May 2025
- ICICIdirect Research
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MARICO REGISTERED MIXED PERFORMANCE IN Q4FY25 WITH CONSOLIDATED REVENUES GROWING BY ~20%
MARICO - 728 Change: -10.50 (-1.42 %)News: Marico registered mixed performance in Q4FY25 with consolidated revenues growing by ~20% (3% higher compared to street expectation) while 300bps decline in the gross margins resulted in lower than expected EBIDTA margins at 16.8% (vs. our and street expectation of 17.2-17.5%). Its consolidated revenues grew by 20%yoy to Rs2,730crore. Domestic business grew by 14%yoy and subsidiaries (including international business) grew by 34%yoy during the quarter. Parachute and Saffola edible oil grew by 22% and 26% driven by price increase while VAHO revenues grew by 1% (return to positive growth). Domestic volume growth improved to 7% (4th consecutive quarter of 100bps improvement in the volume growth) led by foods and premium personal care business. Higher copra prices and vegetable oil prices led to 301bos decline in the gross margins yoy to 48.6%. EBIDTA margins decreased by 263bps yoy to 16.8%. EBIDTA grew by 4%yoy to Rs458crore and PAT grew by 8%yoy to Rs345crore (lower than our as well as expectation).
View: Marico registered Mixed performance in Q4FY25. Its revenues grew by 12% and EBIDTA grew by 6% in FY25. Management has guided for double digit revenue and EBIDTA growth in FY26. Domestic volume growth with remain at 6-7%, Foods and premium personal care (together contributes 22% of domestic revenues) biz will grow at CAGR of 25% and international biz will grow in double digits. Gross margins will remain under pressure in Q1FY26. However copra prices are expected to correct by Q2FY26 and benefit of same will flow in from H2FY26. The company has already undertaken 30% price increase in the Parachute rigid packs. Medium to long term focus is to reduce mix of Parachute in the consolidated revenues by increasing contribution of foods and premium personal care. Project Setu will help to remain competitive in the rural markets by increasing reach in the coming years.
Impact: Neutral