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Q3FY12 – Strong growth in domestic business drives growth
• Net sales grew 29% to `10.6 bn led by healthy volume growth of 20%. While organic volume
growth was at 13%, price /realization growth was 9%.
• In volumes, Parachute (rigid packs) grew 13%, Saffola 15%, while hair oils reported growth of
20% on back of strong demand.
• Gross margin reported expansion of 114bps Y-o-Y (316 bps Q-o-Q) helped by price increases.
• EBITDA grew 22% to `1.2 bn. EBITDA margin contracted by 68bps despite gross margin expansion
due to 48% Y-o-Y increase in ad spends.
• PAT grew 21% to `841 mn. PAT margin contracted 55 bps Y-o-Y to 8%.
• International business grew by 39% Y-o-Y to `2.67 bn.
• Kaya Skin Care reported sales of `750 mn (up 21% Y-o-Y)
Result Highlights
Strong volume growth of 20% led by parachute (13%) and Saffola (15%)
Marico reported strong volume growth of 20%. Domestic business reported 16% volume growth
during the quarter. Parachute (rigid packs) volumes grew 13% Y-o-Y and Saffola volumes were up
15% Y-o-Y. Value-added hair oil volumes grew 31% Y-o-Y.
Increase in Ad Spends Restricted margin expansion
Gross margin reported an expansion of 114bps Y-o-Y (316 bps Q-o-Q) due to reduction in input
costs. EBITDA grew 22% to `1.2 bn. EBITDA margin contracted by 68bps despite gross margin
expansion due to 48% Y-o-Y increase in ad spends (164bps) and employee cost by 45% (83bps). PAT
grew 21% to `841 mn. PAT margin contracted 55 bps Y-o-Y to 8%.
International business growth pushed up by acquisition
International business grew by 39% Y-o-Y to `2.67 bn boosted by acquisition (organic growth -16%).
High inflation and currency depreciation posed as challenge in some regions. International business
reported EBITDA margin of 11% in Q3FY12.
Kaya still in investment phase
Kaya Skin Care reported sales of `750 mn (up 21% Y-o-Y) and EBIT loss of `145 mn. Same store sales
grew 15% Y-o-Y. Management indicated that Kaya will be in investment phase for next year and
expected to breakeven in FY14.
Valuation & Viewpoint
The company has reported strong volume growth in domestic business during the quarter. However
there are concerns regarding continued weak outlook in Kaya and challenging business environment
in Bangladesh and some other international markets.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Q3FY12 – Strong growth in domestic business drives growth
• Net sales grew 29% to `10.6 bn led by healthy volume growth of 20%. While organic volume
growth was at 13%, price /realization growth was 9%.
• In volumes, Parachute (rigid packs) grew 13%, Saffola 15%, while hair oils reported growth of
20% on back of strong demand.
• Gross margin reported expansion of 114bps Y-o-Y (316 bps Q-o-Q) helped by price increases.
• EBITDA grew 22% to `1.2 bn. EBITDA margin contracted by 68bps despite gross margin expansion
due to 48% Y-o-Y increase in ad spends.
• PAT grew 21% to `841 mn. PAT margin contracted 55 bps Y-o-Y to 8%.
• International business grew by 39% Y-o-Y to `2.67 bn.
• Kaya Skin Care reported sales of `750 mn (up 21% Y-o-Y)
Result Highlights
Strong volume growth of 20% led by parachute (13%) and Saffola (15%)
Marico reported strong volume growth of 20%. Domestic business reported 16% volume growth
during the quarter. Parachute (rigid packs) volumes grew 13% Y-o-Y and Saffola volumes were up
15% Y-o-Y. Value-added hair oil volumes grew 31% Y-o-Y.
Increase in Ad Spends Restricted margin expansion
Gross margin reported an expansion of 114bps Y-o-Y (316 bps Q-o-Q) due to reduction in input
costs. EBITDA grew 22% to `1.2 bn. EBITDA margin contracted by 68bps despite gross margin
expansion due to 48% Y-o-Y increase in ad spends (164bps) and employee cost by 45% (83bps). PAT
grew 21% to `841 mn. PAT margin contracted 55 bps Y-o-Y to 8%.
International business growth pushed up by acquisition
International business grew by 39% Y-o-Y to `2.67 bn boosted by acquisition (organic growth -16%).
High inflation and currency depreciation posed as challenge in some regions. International business
reported EBITDA margin of 11% in Q3FY12.
Kaya still in investment phase
Kaya Skin Care reported sales of `750 mn (up 21% Y-o-Y) and EBIT loss of `145 mn. Same store sales
grew 15% Y-o-Y. Management indicated that Kaya will be in investment phase for next year and
expected to breakeven in FY14.
Valuation & Viewpoint
The company has reported strong volume growth in domestic business during the quarter. However
there are concerns regarding continued weak outlook in Kaya and challenging business environment
in Bangladesh and some other international markets.
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