2026-07-08 00:30:06
Latest Post
Innovision Ltd receives LoA worth Rs. 9.23 crores
Actian Expands Data Management Portfolio with Jaspersoft Embedded Analytics and Reporting
Jayant Infratech Ltd receives order worth Rs. 13.31 crores
Uno Minda announces Greenfield Plant in Chhatrapati Sambhaiinagar with Rs. 320 Crore Investment
Siyaram Recycling Industries Ltd secures order worth Rs. 36.95 lakhs
Research
Marico - Domestic volumes sluggish; IBD EBIT declines 74% - Prabhudas Lilladher
Posted On : 2013-05-05 21:19:34( TIMEZONE : IST )
Marico reported flattish adj. PAT on a consolidated basis in Q4FY13 due to subdued performance in International business and Kaya even as domestic consumer business reported 16.5% EBIT growth. MRCO has undertaken price corrections in Parachute and Saffola which should increase volume growth in the coming quarters. IBD is expected to perform better in FY14 on account of improved performance in Bangladesh and Vietnam; we expect GCC region recovery to be back-ended. We estimate 22.5% PAT CAGR over FY13-15 backed by growth momentum in domestic FMCG business and demerger of Kaya. The stock trades at 28.3x FY14 EPS of Rs7.9 and 23.1xFY15 EPS of Rs9.8 (excl. Kaya business, which we value at Rs8/share of MRCO). Maintain 'Accumulate'.
- Domestic FMCG volumes remain subdued; EBIT expands 16.5%: Domestic FMCG sales increased 12.4% and EBIT grew 16.5% in Q4 as margins expanded by 60bps. Parachute and Saffola reported 5% volume growth due to higher premium over loose oils. Value-added hair oils reported 25% volume growth. MRCO gained 410bps market share in coconut oil, 340bps in hair oils and 200bps in premium edible oils during FY13. MRCO has reduced prices of select SKUs of Parachute by 6-8% and Saffola by 4% which should boost volumes from Q1FY14. We expect moderate margin expansion in FY14 post 180bps margin expansion in FY13. Management expects 25% sales growth in Youth brands; we keenly watch for trends in this business as there has been some market share loss in Deodorants.
- International business; EBIT declines 74% as GCC continues to languish: IBD sales declined 1.1% and EBIT declined 74% as margins crashed 440bps to 1.6%. Bangladesh reported smart margin gains due to lower copra prices. Sales growth picked up in Parachute, while value-added hair oils and hair dye continued to post encouraging results. GCC region recovery is expected to be delayed and near-term growth would be a driven by Bangladesh and Vietnam only.
