Dabur India Limited, a leading FMCG company in India, said its consolidated revenue is likely to register mid-single digit growth during Q4 FY24, amidst sluggish demand trends and a high base from the previous year. It will see varied performance across its business segments.
While the Home and Personal Care segment is expected to lead growth, the Healthcare and Food & Beverages segments may face challenges due to delayed winter and high base effects, respectively. The company's international business is expected to perform well in constant currency terms, and its focus on strategic investments is likely to support growth in the coming quarters.
In the previous, third quarter, Dabur reported a 7% revenue growth, with revenue standing at ₹3,255 crore, driven by steady performance in both the Home and Personal Care and Food and Beverages businesses. The third quarter revenue growth was 10% on a constant currency basis.
Margins and Profitability: The company said gross margins are likely to continue to witness expansion in the fourth quarter on account of deflation in input cost and cost- saving initiatives. "In line with the strategy to invest behind our brands we will see higher advertising and promotional spends. The operating profit is expected to grow slightly ahead of the revenue and post an improvement in Y-o-Y," it said.
Home and Personal Care (HPC): The HPC segment is expected to grow in high-single digits in Q4 FY24. In comparison, during the third quarter, Dabur's Shampoo and Post-Wash category reported an over 11% growth, while the Toothpaste business ended the quarter with an industry-leading over 8% jump, backed by Toothpaste Volume growth of 5%. The Home Care business reported a 7% growth in Q3.
Healthcare: The Healthcare segment is expected to register low single digit growth in Q4 FY24, impacted by a delayed winter. In the third quarter, Dabur's digestives business ended with an over 15% growth, while the Ayurvedic Ethicals business grew by nearly 7%.
Food & Beverages (F&B): The F&B segment is expected to register low single digit growth in Q4 FY24, due to a high base from the previous year. However, Badshah Masala, which Dabur acquired, continued to perform well and is expected to post strong volume-led growth in the high teens. In the third quarter, the Beverages business returned to the growth trajectory and ended with a 7% growth, while the Foods business, including Badshah, ended with a 22% growth.
International Business: Dabur's international business is expected to register double-digit growth in constant currency terms in Q4 FY24, led by good momentum in the MENA region, Egypt, and Turkey. However, due to currency depreciation in Turkey and Egypt, the translated revenue in INR terms will show growth in the mid-single digits. In the third quarter, Dabur's international business reported a growth of 11.7% in constant currency terms, with the Nigeria business growing by 52%, Turkey business up by 44%, and Egypt business ending with a 43% growth.