Marico puts on good show

about 2 years ago
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Since the opening bell, Marico stuck steadfast as the top gainer on the BSE. It opened with a gain of over 4% at Rs.354 and went on to hit an intra day high at Rs.367, going up almost 8%. Its 52-week high stands at Rs.397.

The market is very enthused with its performance for Q4FY19 and FY19.

In Q4FY19, Revenue from Operations grew by 9% YoY to Rs.1609 crore, with an underlying domestic volume growth of 8% and constant currency growth of 7% in the international business. Gross margin expanded by 243 bps (YoY) due to lower cost raw material consumption during the quarter.

Operating EBITDA & PAT grew 12% and 18% respectively. Reported PAT growth came in at 122%, including the impact of the one-time write-back of tax provisions amounting to Rs.188 crore. EBITDA margin came in  at 17.6%, expanded by 52 bps YoY.

International business posted a constant currency (cc) growth of 7% led by healthy performance in key markets of Bangladesh (12% cc growth) and Vietnam (13% cc growth).

The business clocked a turnover of Rs.5,756 crore in FY19, a growth of 16% over the last year. The underlying volume growth at 8% was in line with the medium term aspiration. The operating margin in FY19 was 19.6% (before corporate allocations) as against 21.3% in FY18. Profitability for the year was subdued by the gross margin contraction in the first half of the year due to sharp inflation in input costs.

The company has stated that it will continue to focus on a balanced approach towards volume growth and healthy profitability. It said it would be comfortable with EBITDA margins at 20% plus in the India business over the medium term.

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