Godrej Consumer Products (GCPL) reported a 14.2% year-on-year (y-o-y) decline in consolidated net profit for the December quarter, missing analysts’ estimates. The fast-moving consumer good company posted a net profit of Rs 498 crore for the third quarter of FY25 (Q3FY25), falling short of the Rs 525 crore consensus estimate from Bloomberg. The company had earlier warned of a weak Q3 performance in its quarterly update.
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Consolidated revenue for the quarter rose 3% to Rs 3,768 crore, compared to Rs 3,660 crore in the same period last year, slightly surpassing the Bloomberg estimate of Rs 3,709 crore. However, earnings before interest, tax, depreciation, and amortisation (Ebitda) fell 10.1% to Rs 756 crore, down from Rs 841 crore a year ago. Analysts had projected Ebitda at Rs 775 crore. The Ebitda margin contracted to 20.1% from 23% in the prior year, missing the Street estimate of 21%.
In a post-results statement, Sudhir Sitapati, MD & CEO of GCPL, said that the surge in palm oil costs weighed on Ebitda margins. India sales, which account for 60% of the company’s total revenue, grew by 4% during the quarter, while volumes remained flat. Ebitda from India operations declined by 21% during the same period.
“Demand conditions in India have witnessed temporary headwinds over the past few months, led by a slowdown in urban consumption. The increase in palm oil prices by more than 40%, along with weak seasonality in household insecticides, resulted in flat underlying volume growth,” Sitapati said.
He stated that premium formats within the household insecticides segment were impacted due to urban consumption slowdown and seasonal factors.
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“We have now started to gain market share within premium formats, which suggests that the (new) RNF molecule (used in household insecticides) is resonating with consumers,” Sitapati added.
Shares of GCPL closed 1.4% lower at Rs 1,129.90 on the BSE, compared to a 0.43% decline in the benchmark Sensex on Friday. The company announced its results after market hours.
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