Dabur Q4 Results: Profit Up 16.5%, Margin Expands On Lower Costs
The Ayurvedic product maker's net profit rose 17% over the previous year to Rs 341 crore during the quarter-ended March 2024.
Dabur India Ltd.’s fourth-quarter profit rose, meeting analysts' estimates.
The Ayurvedic product maker's net profit increased 16.5% over the previous year to Rs 341.2 crore in January-March, according to an exchange filing. That compares with the Rs 342.67-crore consensus estimate of analysts tracked by Bloomberg.
Domestic volume growth came at 4.2% versus 6% in the preceding quarter.
Dabur Q4 FY24 Highlights (Consolidated, YoY)
Revenue up 5.1% at Rs 2,815 crore (Bloomberg estimate: Rs 2,834.81 crore).
Operating profit up 14% at Rs 467 crore (Bloomberg estimate: Rs 458.62 crore).
Margin expanded to 16.6% vs 15.3% (Bloomberg estimate: 16.2%).
Advertising expenses up 21.4% at Rs 183.6 crore.
Cost of raw materials fell 16% to Rs 1,220 crore, aiding the bottom line.
Strong execution of power brand strategy, increased premiumisation and distribution footprint expansion coupled with the benefits of cost cuts helped Dabur report a steady performance during the March quarter.
Premium products account for 18% of the portfolio, the company said.
"We have been investing heavily behind our brands, which increased by 33%, to drive demand and also sustain the growth momentum," Chief Executive Officer Mohit Malhotra said. During the quarter, Dabur's rural growth stood at 8%, ahead of urban at 4%, aided by distribution expansion.
During the year, Dabur expanded to cover 22,000 more villages. It now reaches 1.22 lakh villages. "Our rural distribution has, in fact, been the highest in the industry, giving us a distinct advantage and helping us drive growth. These ahead-of-curve investments have resulted in our rural business growing 400 bps ahead of urban," according to Malhotra.
Dabur's home and personal care division saw an 8.7% year-on-year growth to Rs 892 crore during the March quarter, while the healthcare segment declined 1.5% to Rs 562 crore impacted due to delayed winter. The growth in food and beverages segment remained flat at Rs 420 crore.
Dabur's international business grew by 12% in constant currency terms, driven by Egypt (63%), Turkey (39%) and Sub-Saharan Africa (23.8%).
Category Growth
Oral care grew 22%, with the toothpaste business reporting a 23% jump. Effectively, every second household in India now uses Dabur.
Hair oils growth contracted 2.5%, but gained market share.
Shampoo grew 6.1%, led by the Vatika franchise.
Home care grew 7.5%, driven by Odomos.
Skincare and over-the-counter business grew 0.6% each.
Delayed winter impacted health supplements, which fell 9.1%.
Digestives grew 16%.
Beverage sales dropped 1.5%, due to last year's high base.
Badshah spices aided Dabur's food business, which grew 20.7%.
The board recommended a final dividend of Rs 2.75 per equity share for the financial year 2024.
Shares of Dabur closed 4.1% higher on Thursday, after the results were declared, as compared with a 0.19% gain in the benchmark Nifty 50.
