Dabur India has announced that it expects to record low single-digit growth in consolidated revenue for the December quarter (Q3 FY25), largely due to subdued demand in its healthcare and beverage segments. This forecast was revealed after market hours on January 3, 2025, as part of the company’s quarterly business update.
Subdued Growth in Key Segments
Dabur anticipates that its overall revenue growth for Q3 FY25 will remain muted, with profits expected to stay flat compared to the same period last year. While the healthcare segment is expected to see no significant growth, the company noted that rural consumption has been resilient, outpacing urban markets.
Key highlights of the quarter:
- Healthcare: Growth in the healthcare segment is expected to remain flat due to the delayed onset of winter.
- Beverages: The beverage segment has witnessed muted growth, reflecting ongoing consumer caution.
- Culinary: In contrast, Dabur’s culinary business, including its popular brands like ‘Hommade’ and ‘Badshah,’ has shown impressive double-digit growth.
Strong Performance in Home & Personal Care
Dabur’s home and personal care (HPC) segment is on track to grow in the mid-to-high single digits. Despite pressures in the general trade sector, alternative channels like modern trade, e-commerce, and quick commerce continue to deliver strong performance, contributing positively to the company’s overall revenue.
Inflationary Pressures and Cost Mitigation
Dabur also highlighted the inflationary pressures faced in certain business segments during the quarter. To address these challenges, the company implemented price increases and efficiency initiatives aimed at mitigating cost hikes, ensuring that its margins remain stable.
International Business on the Rise
Dabur’s international business is expected to see double-digit growth in constant currency terms, driven by strong performance in key markets such as the Middle East and North Africa (MENA), Egypt, Bangladesh, and the US. This growth reflects Dabur’s successful expansion strategy in emerging markets.
Outlook: Optimistic for FMCG Recovery
Despite the challenges faced in Q3 FY25, Dabur remains optimistic about the future. The company expects FMCG growth to revive in the coming quarters, supported by improving macroeconomic indicators and sequential demand improvement. This sets the stage for a more robust performance in FY25.
Dabur’s Market Performance and Recent Financials
Dabur’s performance in Q2 FY25 showed a decline in net profit, with a 17.66% drop to Rs 417.52 crore. However, revenue from operations increased by 5.47%, reaching Rs 3,028.59 crore compared to Q2 FY24. Despite this, Dabur’s shares rallied 2.29% to Rs 525.05 on January 3, 2025, reflecting positive market sentiment.
Navigating Challenges, Preparing for Growth
Dabur India’s mixed performance in Q3 FY25 is a reflection of the challenging market conditions, particularly in the healthcare and beverage segments. However, with a resilient rural market and strong growth in culinary and international business, Dabur is positioning itself for a recovery in the coming months. As the FMCG sector shows signs of revival, the company’s focus on cost-efficiency and strategic expansion will likely pave the way for improved performance in FY25.
