Dabur India, a leading FMCG player, reported a sequential improvement in demand during the December quarter, signalling early signs of a consumption revival. Despite rural growth trailing urban growth, the company observed encouraging trends in volumes.
Emphasizing large volume-led growth as pricing growth remains subdued, Dabur India, known for brands like Dabur Chyawanprash, Dabur Honey, and Real, expects to achieve “mid to high single-digit growth” in revenue for Q3 FY24.
In the domestic market, the food & beverages segment is projected to grow in the high single-digit range, while the home & personal care (HPC) segment is expected to record mid-single-digit growth. The health care business is anticipated to grow in the low to mid-single digits due to the delayed onset of the winter season.
Highlighting the strong performance of Badshah Masala, in which Dabur acquired a 51% stake last year, the company foresees substantial volume-led growth in the high twenties in the branded spices and seasoning market.
Internationally, Dabur expects double-digit growth in constant currency terms, driven by momentum in the MENA region. The company anticipates expanding gross margins, led by moderating inflation and cost-saving initiatives. A significant portion of this margin expansion will be directed towards enhancing advertising and promotion (A&P) spends, resulting in operating profit growth ahead of revenue on a year-over-year basis.
Dabur is optimistic about consumption recovery in both urban and rural markets in India, citing improving macro indicators, increased government expenditure, and positive consumer sentiment. The company remains committed to outperforming in various business segments, gaining market shares, and sustaining brand building initiatives, digital capability enhancement, distribution footprint expansion, and efficiency improvement.
While providing an overall summary of performance and demand trends for the quarter ending December 31, 2023, Dabur India announced that detailed financial results and earnings presentations would be shared post-board approval of consolidated and standalone financial results for the same period.