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Informist, Thursday, Aug. 14, 2025

By Narayana Krishna and Kabir Sharma

HYDERABAD/MUMBAI - Patanjali Foods Ltd. expects "brighter" days for both the fast-moving consumer goods sector and the company in the second half of the current financial year, driven by a better monsoon and improving demand in both rural and urban markets.

"On the macroeconomic front, multiple factors such as healthy monsoons, continued MSP (minimum support price) support, tax benefits for individuals, and festive seasons are converging to create a conducive environment for demand recovery. We are hopeful for H2 (Oct-Mar), and FY26 will be brighter," Patanjali Foods management said in a post-earnings analyst call on Thursday.
 

During the June quarter, urban demand remained under pressure, while rural demand continued its uptrend, the company said. It expects an uptick in urban demand in the coming months.

"The overall FMCG demand environment remained subdued during the quarter. Rural demand continued to outpace urban demand, though urban markets showed early signs of recovery towards the end of Q1FY26 (Apr-Jun)," Patanjali Foods said.

For the June quarter, Patanjali Foods reported a net profit of INR 1.80 billion, down 31% on year and 50% on quarter, mainly due to increased raw material costs. The company's revenue for the quarter rose 24% on year but fell 8% on quarter to INR 89.00 billion. Patanjali Foods management said raw material costs showed signs of easing towards the end of the June quarter, which may support margin improvement in the coming quarters. For the June quarter, the company's earnings before interest, tax, depreciation, and amortisation margins declined to 3.8% from 6.1% a year ago, while EBITDA fell to INR 3.34 billion from INR 4.35 billion.

"The company's aspiration is to grow revenues to INR 500 billion, with INR 250 billion coming from FMCG and INR 250 billion from edible oil, and to expand margins towards double-digit EBITDA," Patanjali Foods management said.

"We are consistently doing 5.5% to 6% (EBITDA margins), and we would like this to go to 10%," the management said. The management said the reduction in basic customs duty on edible oil to 10% impacted oil demand in the country. However, overall, the reduced duty structure is favorable for the company in the long term, it said.

"The reduction in duties leading to a normalised pricing trend on crude edible oils is a positive development for our oil refining segment. It will catapult strong growth momentum in the edible oil business going forward," the company said. Patanjali Foods expects its biscuit sales to grow over 10% going forward, as the brand's positioning remains strong in the market. On Thursday, shares of Patanjali Foods ended at INR 1,764.80 on the National Stock Exchange, down 1.8% from their previous close.  End

Edited by Akul Nishant Akhoury

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