Godrej Consumer Products (GCPL) on Tuesday said it expected mid-single-digit consolidated sales growth in rupee terms and low-teens growth in constant currency for the September quarter as part of business update for the period.
GCPL is the second FMCG firm to flag weak numbers in Q2 after Dabur said last week that it expected to post a mid-single digit decline in its consolidated revenue for Q2FY25. This was due to reduced consumer demand and consumer offtake caused by extreme weather events such as floods and heavy rains. The beverage business in India, Dabur said, was hit due to weak demand, though international business was stable.
For GCPL, however, consolidated EBITDA growth will be lower than anticipated, with mid-single-digit gains, impacted by challenging operating conditions in India, particularly due to rising palm oil costs.
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While standalone revenue may log a high single-digit growth in both volume and value, the EBITDA growth will remain flat, the company said.
“Palm input costs have been rising since March and have risen in high teens as of date. Management has decided not to pass on the entire cost hike to consumers in one step and have decided to continue investments on the long-term growth initiatives like rural van programme, new category development, etc. As a result, the standalone EBITDA growth will be flattish,” said the firm.
Internationally, the Indonesia business remains robust, with high single-digit volume and double-digit sales growth expected. Meanwhile, the GAUM region is experiencing a decline in trade stocks and currency challenges in Nigeria, but EBITDA in INR has shown strong double-digit growth for the third consecutive quarter.
From: financialexpress
Financial News
