Analyst Concall
Marico mgmt says co eyeing double-digit EBITDA growth in H2
This story was originally published at 21:17 IST on 14 November 2025
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--Copra prices may settle down, fall March onwards
--CONTEXT: Comments by Marico's management in post-earnings investor call
--Target 25% growth in consolidated revenue in FY26
--Eye double digit EBITDA growth in H2 as margin pressures ease
--Expect Parachute volumes to rise, slight increase in advt spend
By Sunil Raghu and Afra Abubacker
AHMEDABAD/NEW DELHI – The hyperinflationary copra prices that put pressure on Marico Ltd.'s earnings in the June quarter continued to impact the September quarter too. The price of copra, the main input cost in its domestic Parachute coconut oil segment, failed to cool down as the management of consumer goods company Marico had indicated to analysts and investors in a post-earnings call post the June quarter earnings. The impact was such that the company had to take a 60% price hike during the quarter to offset the rising copra prices. Even the management claimed it had not heard of such a hike for any brand or power brand in the world. However, the management Friday reiterated that it was optimistic copra prices are likely to settle down and begin falling March onwards.
The fast-moving consumer goods major reported a 0.7% on-year fall in its consolidated bottom line to INR 4.20 billion for the quarter, largely in line with analysts' consensus estimate of INR 4.21 billion net profit. The net profit fell largely due to higher copra prices, which were up over 118% on year.
The company's consolidated top line for the quarter was INR 34.82 billion, up nearly 31% from the year-ago quarter. The revenue was also largely as per expectations of INR 34.35 billion. Price hikes in Parachute Coconut Oil, the company's major portfolio, drove the revenue growth.
The Parachute segment, which contributes about 36% to the company's India revenue, recorded a low 3% on-year volume growth in the September quarter, but the revenue jumped 59% on the back of price hikes of around 60%, according to the company's investor presentation and management comments. Going ahead, the management believes that volumes of Parachute will rise as the company increases its spend on advertising activities by a bit. Saffola edible oil, which accounted for 17% of the company's revenue, too, saw flattish volume growth in the September quarter but a 19% jump in revenues.
The company's gross margins contracted by 810 basis points year-on-year, due to a high base as sharp inflation in key commodities also exerted incremental pressure this quarter, the company said in its presentation. "Despite these headwinds, we continued to invest meaningfully to strengthen the long-term equity of our franchises and accelerate portfolio diversification, with advertising and promotion spends rising 19% year-on-year," the company said. Consequently, the earnings before interest, tax, depreciation, and amortisation, or EBITDA, was up 7% in Jul-Sept. Its EBITDA margin stood at 16.1%, down 350 bps on year. As the margin pressure eases, the company's management is hoping to achieve double-digit growth in the second half of 2025-26 (Apr-Mar).
The management said the company will continue to scout for inorganic growth opportunities to consolidate its competitive position in existing categories, expand the total addressable market in existing geographies or access markets of interest. "In the first half of the fiscal year, the India business delivered high single-digit volume growth," the management said, adding that it is targetting 25% growth in consolidated revenue in FY26. The international business also strengthened its robust double-digit growth momentum.
On the recent goods and services tax rate rationalisation, the company's management said the move will stimulate demand and long-term growth in the FMCG sector. More than 30% of the company's India business has benefitted from the GST rate rationalisation and the company has passed on the benefits of the revised GST rates to consumers across relevant product categories, reinforcing affordability and accessibility.
Marico announced its September quarter earnings during market hours Friday. Following the company's results, the stock reversed early losses and ended up over 2.3% at INR 738.70 on the National Stock Exchange. End
Edited by Tanima Banerjee
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