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<ul><li>Price cuts taken in mass segments will erase pricing-led growth seen in FMCG companies.</li><li>Few analysts are confident that price cuts will add to volume growth in Q2.</li><li>Without a meaningful rural recovery, volume growth will remain slow. </li></ul>It might be a slow second quarter for FMCG companies with hazy volume recovery and tapering raw material effects. The rise of new and local players have been eating into the business of top FMCG players. And, they chose to <a href="https://www.businessinsider.in/business/news/soap-opera-fmcg-players-kick-off-price-war-to-bring-back-whats-lost/articleshow/103657469.cms">take price cuts in mass categories </a> during the quarter. Analysts are divided on how much price cuts will add to volume growth. A report by Centrum said that price cuts pushing are primary volumes but off-take lags. The demand for packaged foods is rising but hair oils, toothpaste categories saw falling volumes. “Selling prices have been rationalised given the drop in commodity costs but there has not been a commensurate increase in volumes yet,” said J M Financial. The pricing-led growth in FMCG companies is now a thing of the past. Without significant volume recovery, revenues are ecpected to remain subdued this quarter. “We expect low single digit volume growth and low-to-mid single-digit value growth for most FMCG companies, with the tapering of pricing growth due to price cuts and/or anniversarization of price hikes. The underlying rural demand remains subdued. Uptick, if any, would be optical off a low base,” said a report by Kotak Institutional Equities. Analysts believe that without a meaningful recovery in rural demand which is yet to pick up, volume recovery will remain slow. Even tapering inflation during the quarter has not improved the rural consumer sentiment due to unseasonal rains. Moreso, the festive consumption of discretionary items also comes with a lag this year due to the ‘Adhik Mas’ effect. Raw material benefits slip On the other hand, the margin growth seen last quarter due to lower raw materials will also taper off. The raw material index has moved up by 8-9% over the last three months. Between July and September, crude oil prices rallied by 20%, and commodities will not be as benign as they were in Q1. On a year-on-year basis however their costs will be lower, adding to margins due a favourable basis. “A favourable base would still drive strong year on year gross profit margin expansion and earnings for September quarter, but some of the margin gains would be in the base soon especially given the recent uptick in raw material prices,” said J M Financial. The stress of rising competition will also eat into margins in more ways than price cuts. Players will continue to ‘normalise’ brand-building investments that were run down during the hyper-inflationary phase in FY23. “Most companies have indicated that a large part of gross margin savings will be invested behind brands. Hence, operating margin expansion will be lower compared to gross margin expansion,” said Sharekhan. Investors will watch out for management commentary on how volume uptick in the second half of the year. And a picture on when rural India will see a full-fledged recovery. <div type="javascript" title="Custom" contenttype="Text"><cdata><![CDATA[]]></cdata></div>

Price cuts might not bring in volume growth for FMCG majors in Q2 say analysts

Encouraged by volume growth, margin improvement and recovery in rural sales, India's top fast-moving consumer goods (FMCG) companies are now back to their normal growth cycle as they step up investments as well as spending on advertising and marketing. <keyword id="84065" type="General" weightage="20" keywordseo="fmcg-companies" source="Orion">FMCG companies</keyword> are chasing volume growth again after a gap of a few quarters, offering higher grammage and price cuts thanks to inflationary pressures softening on key raw materials for everything from soaps to food items. Hindustan Unilever (HUL), Dabur, Marico, Godrej Consumer Products, ITC, Tata Consumer Products and Nestle reported volume recovery in the March quarter and said they expect a gradual pickup in consumption in FY24. "The prospects of a sustained recovery have strengthened. After five quarters of volume decline, the sector has posted volume growth," Marico MD and CEO Saugata Gupta said in the company's earnings conference call. "Urban consumption has been steady while rural is showing some convincing signs of having bottomed out." Foods continue to drive growth for the sector, while the home and personal care segment also entered positive territory after an extended slowdown. Marico, which owns popular brands like Saffola, Parachute and Livon, reported an 18.7 per cent increase in its consolidated net profit to Rs 305 crore for the fourth quarter ended March 2023 while sales rose 3.65 per cent to Rs 2,240 crore, driven by single-digit volume growth and moderation in commodity prices. HUL said rural areas have shown improvement with higher value growth sequentially. While HUL's volumes continue to fall, the extent of decline has reduced versus last quarter. "The slowdown in the FMCG market is bottoming out. This improvement was led by volumes, which have turned flat in this quarter, versus a mid-single-digit decline in the December quarter," said HUL CFO Ritesh Tiwari in its earnings call. The makers of popular brands such as Rin, Lux, Surf Excel and Pond's said it expects the price-volume growth to rebalance further. "We expect volumes to recover gradually due to high levels of cumulative inflation and the fact that consumption habits typically recover with a lag," he said. For the March quarter, HUL reported an increase of 12.74 per cent in its consolidated net profit to Rs 2,601 crore. Net sales rose 10.83 per cent to Rs 14,926 crore. However, HUL warned the near-term operating environment is likely to remain volatile due to global slowdown risk and uncertainty related to weather phenomena like El Nino and heatwaves. Abneesh Roy, Nuvama Group Executive Director for Institutional Equities, said the outlook for the <keyword id="495979" type="General" weightage="20" keywordseo="fmcg-industry" source="Orion">FMCG industry</keyword> was "positive" with volume growth and improvement in margins for most companies in FY24. "As raw material prices are cooling off, companies shall start paring prices via grammage increase or gradual price reductions. Price growth shall ease while volume growth will improve," he said. Roy also cautioned about the impact of El Nino and the "aggression" from billionaire Mukesh Ambani-led Reliance Industries Ltd, a known disrupter, which aims to be a big player in the USD 110-billion FMCG segment. Meanwhile, Godrej Consumer reported an 11.47 per cent increase in its India revenue to Rs 1,822.92 crore in the March quarter. This was led by volume growth of 11 per cent. Its home care segment, which consists of household insecticides and air fresheners, grew 14 per cent and 17 per cent, respectively. "We expect to build on the current momentum and deliver volume-led growth along with upfront marketing investments and improvement in profitability," said its Managing Director and CEO Sudhir Sitapati. Britannia Executive Vice-Chairman and Managing Director Varun Berry also expressed optimism. "Volume growth will be certainly much better than this year," he said. On commodity prices, Berry said there is deflation in prices of palm oil, laminates and corrugated material for packing but flour and milk prices are soaring. "There are certain brands and certain packs where we have already initiated price reductions or promotions," he said. In the March quarter, Britannia reported a 47.53 per cent jump in consolidated net profit to Rs 557.60 crore. Its revenue from operations rose 10.93 per cent to Rs 3,892.02. Similarly, Dabur reported volume growth of 11 per cent during the March quarter and 14 per cent for FY23. Its quarterly net profit was Rs 292.76 crore and revenue from operations stood at Rs 2,677.8 crore. "Despite near-term concerns around inflationary pressures, we plan to accelerate the growth momentum by continuing to invest in brand building, innovation, and capabilities that will drive growth," said Dabur India CEO Mohit Malhotra. Other companies also recorded growth. ITC's revenue from the FMCG segment rose 19.34 per cent to Rs 4,951.17 crore from Rs 4,148.62 crore while EBITDA jumped 76 per cent. Nestle, the maker of Maggi, Kitkat and Nescafe, reported an increase of 24.69 per cent in its net profit to Rs 736.64 crore in the March quarter. Sales rose 20.43 per cent to Rs 4,808.40 crore. Tata Consumer reported a 21.12 per cent rise in its consolidated net profit to Rs 289.56 crore. Its revenue from operations was up 13.96 per cent at Rs 3,618.73 crore. Tata Consumer said it recorded growth in the India beverages business and food. It had a "strong margin growth and strong topline growth driven both by volume and price," the company said in its earnings call. "We have started seeing volume growth coming back. The impact of inflation and monetary tightening on economic growth and demand seems to be slowing down, but I would keep my fingers crossed and monitor it closely," said Tata Consumer MD and CEO Sunil D'Souza. "In the near term, we are seeing stability." SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/corporates/news/zomato-net-loss-narrows-to-188-crore-in-q4-revenue-rises-70-yoy/articleshow/100358894.cms">Zomato net loss narrows to ₹188 crore in Q4, revenue rises 70% YoY</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/stock-market/news/mankind-pharma-pnb-among-stocks-to-become-largecap-from-midcap-mutibagger-rail-vikas-nigam-to-turn-midcap-from-smallcap/articleshow/100356527.cms">Mankind Pharma, PNB among stocks to become largecap from midcap; mutibagger Rail Vikas Nigam to turn midcap from smallcap</a>

FMCG makers expect sustained recovery in volume and margins with price reduction in FY24

<ul><li>India’s benchmark indices <keyword id="6484188" type="General" weightage="20" keywordseo="sensex" source="Orion">Sensex</keyword> and <keyword id="2931774" type="General" weightage="20" keywordseo="nifty50" source="Orion">Nifty50</keyword> rose in morning trade on Monday amid positive cues in global markets. </li><li>Amongst the top gainers were stocks from the banking, auto and realty sectors. </li><li>Both the benchmark indices were up by 1% in morning trade, with Sensex hovering at 61,670 points and Nifty50 at 18,245 points. </li><li><keyword id="6367820" type="General" weightage="20" keywordseo="adani-group" source="Orion">Adani group</keyword>, <keyword id="6357120" type="General" weightage="100" keywordseo="paytm" source="Orion">Paytm</keyword>, <keyword id="6359432" type="General" weightage="20" keywordseo="britannia" source="Orion">Britannia</keyword> and <keyword id="6361485" type="General" weightage="20" keywordseo="marico" source="Orion">Marico</keyword> are amongst stocks in focus today. </li></ul>India’s benchmark indices Sensex and Nifty50 rose in morning trade on Monday amid positive cues in global markets. Amongst the top gainers were stocks from the banking, auto and realty sectors. Both the benchmark indices were up by 1% in morning trade, with Sensex hovering at 61,670 points and Nifty50 at 18,245 points. Top gainers and losers on Nifty50 <table style="border-width: initial; border-style: none;"></colgroup><tbody><tr><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 1pt;border-top:solid #000000 0.5pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Top gainers </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 1pt;border-top:solid #000000 0.5pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Change </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 1pt;border-top:solid #000000 0.5pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Top losers </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 1pt;border-top:solid #000000 0.5pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Change </td></tr><tr><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 1pt;vertical-align:top;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">IndusInd Bank </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 1pt;vertical-align:top;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">4.91% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 1pt;vertical-align:top;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Coal India </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 1pt;vertical-align:top;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-2.61% </td></tr><tr><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Bajaj Finance </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2.66% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Adani Enterprises </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-1.67% </td></tr><tr><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:top;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Tata Motors </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:top;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2.30% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:top;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Dr. Reddy's Laboratories </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:top;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-0.62% </td></tr><tr><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Bajaj Finserv </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2.25% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Sun Pharma </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-0.37% </td></tr><tr><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:top;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Hindalco Industries </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:top;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2.01% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:top;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">L&amp;T </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:top;background-color:#d9d9d9;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-0.36% </td></tr></tbody></table> Source: NSE, as on May 3, 2023 Earlier last week, the markets wrapped up a week of volatility in the green despite selling pressure on Friday. While Sensex gained 0.73%, NIfty50 closed 0.96% higher in the last week. Positive news from the US in terms of jobs data eased recession fears and this reflected in the softening prices of gold and silver. Gold prices fell to ₹60,600 per 10 grams while silver was down to ₹77,000 per kilogram. Crude oil prices, on the other hand, edged up, with Brent crude prices crossing the $75 per barrel mark. <cmsannotation type="cmsannotation" annotationid="US markets cheer jobs data" comment="subhead" text="US markets cheer jobs data">US markets cheer jobs data</cmsannotation> Markets in the US cheered jobs data which beat expectations – new non-form jobs stood at 2.53 lakh in April, as against expectations of 1.79 lakh. This led to the Dow Jones rising 1.65%, while S&amp;P 500 rose 1.85%. The tech-heavy Nasdaq rose 2.25%. Asian markets were largely positive, led by Shanghai Composite which was up 1.69%, while KOSPI gained 0.9% and Hang Seng rose 0.83%. Taiwan Weighted gained 0.61%, but Nikkei 225 was down 0.65%. <cmsannotation type="cmsannotation" annotationid="Stocks to watch" comment="subhead" text="Stocks to watch"><keyword id="73648" type="General" weightage="20" keywordseo="stocks-to-watch" source="Orion">Stocks to watch</keyword></cmsannotation> Adani group: Adani Transmission and Adani Total Gas’ free-float will be lowered to 10% and 14%, respectively from 25% in the MSCI May index review. One97 Communications (Paytm): The payments company reported a 52% YoY rise in revenue to ₹2,335 crore in the March quarter, while its net loss narrowed to ₹168 crore from ₹761 crore a year ago. <keyword id="146218" type="General" weightage="80" keywordseo="britannia-industries" source="Orion">Britannia Industries</keyword>: The FMCG player has reported a 47% jump in March quarter net profit to ₹557 crore while revenue from operations grew 13% to ₹4,023 crore. Marico: Parachute and Saffola oil marker has reported 20% on year net profit growth at ₹302 crore for March quarter while revenue rose 4% to ₹2,240 crore. The FMCG player reported 5% volume growth in its India business for the quarter. Union Bank of India: The lender has reported 93% jump in net profit at ₹2,782 crore while net interest income was up 21% at Earnings today: UPL, Canara Bank, VIP Industries, Birlasoft, Balkrishna Industries, Exide Industries, Pidilite, Aarti Industries, APollo Pipes among companies to report their quarterly earnings on Monday. SEE ALSO: <a href="https://www.businessinsider.in/personal-finance/news/how-hra-exemption-can-help-you-save-tax-in-2023-24/articleshow/100014412.cms">How HRA exemption can help you save tax in 2023-24</a> <a href="https://www.businessinsider.in/business/corporates/news/with-another-wedding-season-ahead-analysts-are-upbeat-on-titan/articleshow/99986767.cms">With another wedding season ahead, analysts are upbeat on Titan</a> <a href="https://www.businessinsider.in/business/news/indigo-airlines-stock-to-surge-further-as-go-firsts-troubles-mount/articleshow/100009541.cms">The skies are clearer for IndiGo stock to surge further as Go First’s troubles mount</a>

Sensex, Nifty50 edge up in morning trade led by banks, auto and realty stocks

<ul><li>Indian benchmark indices ended lower on Thursday weighed down by a selloff in Bajaj Finance, Bajaj Finserv and other heavyweights like ICICI Bank and Infosys despite positive cues from global markets.</li><li>Bajaj Finance was the top loser on the benchmark indices as it plunged over 7% after the announcement of its December quarter business update.</li><li>Markets around the world gained after the release of US Fed minutes.</li></ul>Indian benchmark indices ended lower on Thursday weighed down by a selloff in Bajaj Finance, Bajaj Finserv and other heavyweights like ICICI Bank and Infosys despite positive cues from global markets. The 30-stock index <keyword id="6484188" type="General" weightage="20" keywordseo="sensex" source="Orion">Sensex</keyword> closed 0.50% or 304 points lower at 60,353 while the 50-stock index <keyword id="2931774" type="General" weightage="20" keywordseo="nifty50" source="Orion">Nifty50</keyword> ended down 0.28% or 50 points lower at 17,992. “<keyword id="6354813" type="General" weightage="20" keywordseo="nifty" source="Orion">Nifty</keyword> fell for the second consecutive session on January 5, though it recovered smartly from intra day lows post 1:30 p.m. At close Nifty was down 0.28% or 50.8 points at 17992.2. Volumes on the NSE are rising gradually as people return to work after holidays,” said Deepak Jasani, head of retail research at HDFC Securities. Here are the top gainers and losers on Nifty50 on Thursday <table style="border-width: initial; border-style: none; table-layout: fixed; width: 468pt;" class="redcator-table-advance"></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Top gainers </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">% change </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Top losers </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">% change </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Cipla </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2.17% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Bajaj Finance </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-7.23% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Bajaj Auto </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2.12% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Bajaj Finserv </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-5.24% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">ITC </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2.02% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">ICICI Bank </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-2.27% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">HUL </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">1.96% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Infosys </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-1.28% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">JSW Steel </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">1.86% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Titan </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-1.25% </td></tr></tbody><tbody></tbody><tbody></tbody><tbody></tbody><tbody></tbody></table> Among sectoral indices, except bank, IT and financial service all other sectors were trading in green. <div type="image" title="sectoral-indices-23" msid="96767782" hostid="261"></div> On the other hand, rupee appreciated against the US dollar on Wednesday with a gain of 32 paise to close at 82.5. Bajaj twins weighed down on indices Shares of Bajaj Finance was the top loser on the benchmark indices as it plunged over 7% after the announcement of its December quarter business updates that disappointed analysts on lower than expected growth in assets under management (AUM). The financial services company reported an AUM growth of 27% on year and 6% on a sequential basis at ₹2.31 lakh crore. “Q3 AUM growth was nearly 200 basis points lower than our estimate of 7.5% QoQ. Q3 is usually a strong quarter due to festivals, so either there was some impact at the end of Q2 or the company lost some market share,” said a report by global brokerage CLSA. CLSA recommended a ‘Sell’ rating on the company saying loan growth slowed despite a festive season, which is otherwise a strong period owing to festivities. Following this, shares of Bajaj Finserv, a parent company of Bajaj Finance, also dropped sharply by over 5%. Besides, the fall in crude oil prices on concerns of a recession in the global economy and the spread of Covid in China pared some losses. Brent crude oil prices fell below the $80 mark and were hovering around $79.81 per barrel on Thursday. Meanwhile, markets around the world were in the green after the US Fed’s minutes were released on Wednesday, wherein officials stressed on the need to maintain flexibility while still focusing on inflation. <div type="image" title="daily-profit-loss-23" msid="96767788" hostid="261"></div> US Fed emphasizes on the need to retain ‘flexibility’ Investors across the globe took some support from the US Fed minutes released on Wednesday, where the officials agreed that the central bank should slow the pace of its aggressive interest rates increase while controlling inflation. While the commentary seemed positive, the Fed still has its focus on controlling inflation. “Most participants emphasised the need to retain flexibility and optionality when moving the policy to a more restrictive stance,” the Fed minutes said. Both foreign institutional investors (FII) and domestic institutional investors (DII) were net sellers on Thursday pulling out ₹1,449 crore and ₹194 crore respectively. SEE ALSO: <a href="https://www.businessinsider.in/business/corporates/news/tcs-infosys-wipro-and-other-it-companies-earnings-preview-for-q3-fy23/articleshow/96731891.cms">December quarter likely to be a weak one for the IT sector – Infosys amongst top analyst picks</a> <a href="https://www.businessinsider.in/stock-market/news/the-ipo-momentum-will-continue-in-2023-at-least-for-sme-ipos-prime-database/articleshow/96728596.cms">The IPO momentum will continue in 2023 at least for SME IPOs: Prime Database</a> <a href="https://www.businessinsider.in/business/auto/news/pv-and-2w-sales-disappoint-in-december-but-stronger-growth-ahead-say-analysts/articleshow/96732246.cms">PV and 2W sales disappoint in December, but stronger growth ahead, say analysts</a>

Sensex, Nifty50 end lower weighed down by a selloff in Bajaj twins, heavyweight ICICI Bank, Infosys

<ul><li>The shares of <keyword id="6361485" type="General" weightage="20" keywordseo="marico" source="Orion">Marico</keyword> fell over 4% on Wednesday as the FMCG company’s revenue grew in single digit in the last quarter.</li><li>The company noted that the consumption trends remained subdued during the last quarter.</li><li>Marico also informed the stock exchange that it had to opt for a price hike across FMCG categories.</li></ul>The shares of Marico fell over 4% on Wednesday as the fast-moving consumer goods (FMCG) company’s revenue grew in single digit in the last quarter. The company's shares closed at ₹521.6 on April 6. Marico currently sits at a market capitalisation of ₹67,431 crore, or $8.9 billion. The 42-year-old company is yet to report its financial statement for the January to March quarter, or Q4, of fiscal year 2022. However, it did offer some not-so-strong update on April 5. The company, in the filings with the stock exchange, noted that the consumption trends remained subdued during the last quarter majorly due to weak rural sentiments and inflation in global commodities due to aggravating geo-political issues between Russia and Ukraine. Marico also informed the stock exchange that it had to opt for price hike across FMCG categories in order to cope up with the current inflation levels, which hurt the consumer wallets across rural and urban areas. “While companies affected price hikes across FMCG categories to cope with the cost-push, persistent inflation continued to hurt consumer wallets across rural and urban [areas]. As a result, FMCG volumes declined in the Jan-Feb’22 period on a year-on-year basis (per Nielsen),” Marico said in a statement. Despite the subdued update, Nomura has maintained a ‘buy’ call on the shares of Marico with a target price of ₹665. The global financial services company is of the view that Marico is a strong beneficiary of a “resilient core” and significant “future growth vectors”. Nomura has estimated consolidated revenue growth of 7.4 percent year-on-year (YoY) in Q4 of FY2022. Meanwhile, profit growth is estimated to be at 5% YoY and EBITDA (earnings before interest, taxes, depreciation, and amortisation) at 9%. Meanwhile, Macquarie expects a broadly flat profit and marginal volume growth for Marico in India. The brokerage firm has given it an “outperform” rating on the stock market with a target price of ₹600. CLSA, on the other hand, believes that Marico’s current valuation looks balanced. Therefore, it has given an “underperform” call on Marico with a target price of ₹530. SEE ALSO <a class="tout-title-link" href="https://www.businessinsider.in/stock-market/news/tcs-marico-tata-steel-adani-enterprises-among-stocks-to-watch-out-for-on-april-6/slidelist/90675501.cms">TCS, Marico, Tata Steel, Adani Enterprises among stocks to watch out for on April 6</a> <a href="https://www.businessinsider.in/business/startups/news/josh-dailyhunt-parent-company-verse-raises-805-million-takes-valuation-to-5-billion/articleshow/90675633.cms" data-type="tilCustomLink">Josh, Dailyhunt parent company VerSe raises $805 million, takes valuation to $5 billion</a> <a href="https://www.businessinsider.in/business/auto/news/toyota-hilux-price-specification-features-in-india/slidelist/90667350.cms">All you need to know about the new heavy-duty pickup truck— Toyota Hilux</a>

A weak January-March quarter update has left Marico investors quite upset

<ul><li><keyword id="6361485" type="General" weightage="20" keywordseo="marico" source="Orion">Marico</keyword>’s chief Saugata Gupta has confirmed that the company has engaged in three rounds of price deduction for Saffola and Parachute in the last four months.</li><li>These reductions are based on the declining copra prices.</li><li>This pricing strategy is likely to start paying off by fiscal year 2023, the company believes.</li></ul>Rising input cost was one of the major pain points for all major fast moving consumer goods (FMCG) companies like <a href="https://www.businessinsider.in/retail/news/profit-margin-of-britannia-declines-in-q2-of-fy-2022/articleshow/87600806.cms">Nestle, Hindustan Unilever, Britannia</a> and others over the last two years. These companies had to constantly increase the price of their products in order to keep their margins intact and show higher growth to their investors. Even Marico — the company behind brands like Saffola and Parachute — had taken part in this pricing strategy. However, the company has now decided to backtrack a bit and reduce the price of its products in the months to come. Marico’s managing director (MD) and chief executive officer (CEO) Saugata Gupta, in the earning call with the analysts, highlighted that the company has already engaged in three rounds of price deduction for Saffola and Parachute in the last four months. The first price deduction was in October 2021, followed by December 2021 and January 2022. Parachute and Saffola are the most popular products by Marico. <table style="border-width: initial; border-style: none; table-layout: fixed; width: 468pt;"></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Product </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Market Share </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Price increase since 2021 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Parachute </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">63%+ </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Up to 6% in coconut oil </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Saffola </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">83%+ (refined oil), 43% (oats) </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">50% in refined oil category </td></tr></tbody></table> Reduction in price come on declining copra price The company will further look to reduce prices of these products as it expects the input costs to lower due to dropping Copra (dried coconut kernel) rates. Copra prices account for nearly 50% of raw material costs overall for its coconut oil portfolio, Marico’s chief financial officer (CFO) Pawan Agrawal has previously said. “Parachute part is clearly certain, but it is difficult to take a call on the rest of the business that will all depend on rural growth and inflation [as well as crude oil prices],” CEO Gupta said. He assured, “We have put in a lot of cost management exercises, which will also accrue next year [financial year 2023]... Operating margin will definitely be higher next year than this year [FY2022].” <div type="image" title="Marico has been reducing the price of Saffola and Parachute, and it may go down further" msid="89247399" hostid="261"></div> The company has decided to focus on price cuts in order to focus on sales volume, instead of margin. It believes that this will further help the company’s long term growth vision and make the price of its product more competitive. “We are not shy in taking price drops, our endeavour is to ensure that volume growth happens and not short term price margins,” Gupta said, adding that it may be able to achieve a normal EBITDA margin of 19% in the last quarter of FY2022. EBITDA stands for earnings before interest, taxes, depreciation, and amortisation. SEE ALSO <a class="tout-title-link" href="https://www.businessinsider.in/stock-market/news/ags-transact-technologies-ipo-makes-a-weak-listing-on-exchanges/articleshow/89236121.cms">AGS Transact Technologies makes a weak listing with ₹1 profit for IPO investors</a> <a href="https://www.businessinsider.in/budget/news/rupee-is-likely-to-weaken-against-the-us-dollar-in-2022-as-per-experts/articleshow/89218673.cms">Experts say the rupee is likely to weaken against the US dollar this year</a> <a href="https://www.businessinsider.in/tech/news/prime-minister-narendra-modi-mann-ki-baat-january-2022-does-not-mention-if-india-bought-pegasus-spyware/articleshow/89218666.cms">Simply put, the charge on the Modi government is that it lied to the Parliament about buying Pegasus spyware and it must respond</a>

You Searched For "marico" and got 6 results

Price cuts might not bring in volume growth for FMCG majors in Q2 say analysts

Katya Naidu

FMCG makers expect sustained recovery in volume and margins with price reduction in FY24

PTI

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Sensex, Nifty50 end lower weighed down by a selloff in Bajaj twins, heavyweight ICICI Bank, Infosys

Rounak

Bhakti

A weak January-March quarter update has left Marico investors quite upset

Kritti Bhalla

Marico has been reducing the price of Saffola and Parachute, and it may go down further

Kritti Bhalla

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