NEW DELHI: FMCG major Colgate-Palmolive India on Wednesday reported a 10.1% decline in net profit at Rs 209.67 crore for the quarter ended June 30 as compared to Rs 233.23 crore in the same period a year ago. This is owing to the inflationary pressures and rural slowdown, Colgate-Palmolive India (CPIL) said in a regulatory filing. The company’s revenue for the June quarter stood at Rs 1,196.8 crore, moving up 2.6% from Rs 1,166 crore in the same period last year.
CPIL’s total expenses also rose 6.95% to Rs 916.60 crore in the quarter under review, as against Rs 856.99 crore in the same quarter a year ago. Mukul Deoras, Chairman of Colgate-Palmolive (India), said, “The current quarter continued to witness challenging trends that we saw in the previous quarter. While we remain cautiously optimistic that the trends will improve in the coming quarters, the current quarter was impacted by overall rural slowdown and inflationary pressures.”
“Our overall pricing strategy and strong funding of the growth programs delivered consistent margins while we continue to maintain our strong investment in innovation and brand building activities.” High raw material inflation has not only adversely impacted margins for FMCG companies but it has also slowed down demand conditions in rural & semi-urban regions as consumers are down trading towards smaller SKUs & economy brands, say analysts at brokerage firm ICICI Securities.