Surge was primarily on account of recognition of MAT Credit Entitlement amounting to ₹288 crore

Home-grown FMCG company Emami Ltd registered nearly 302 per cent growth in consolidated net profit at ₹354 crore for the quarter ended March 31, 2022, compared to ₹88 crore in the same period last year.

The surge in net profit was primarily on account of recognition of MAT Credit Entitlement amounting to ₹288 crore, the company said in a press statement.

Consolidated revenue from operations grew by around five per cent to ₹770 crore (₹731 crore).

For the year ended March 31, 2022, the company registered 84 per cent growth in consolidated net profit at ₹837 crore, compared with ₹455 crore last year. Consolidated revenue from operations increased by 11 per cent at ₹3,192 crore (₹2,880 crore).

The FMCG industry was affected with muted volumes in Q4 against the backdrop of rising inflation levels, further fuelled by geo-political factors that impacted the overall consumption sentiment across rural and urban markets. Despite the overall challenging macro environment, the company’s consolidated revenues grew by five per cent in Q4FY22, on a high base of 37 per cent growth in previous year, it said.

E-commerce channel

Domestic business grew by four per cent in Q4FY22, on a high base of 42 per cent growth in the previous year with all the brands either increasing or maintaining their leadership positions. Both modern trade and e-commerce continued to perform exceedingly well to post a growth of nine per cent and 90 per cent respectively over the previous year. In Q4FY22, the salience of e-commerce channel increased to little over seven per cent of domestic revenues.

The company’s initiatives to increase its distribution footprint continue to be on track with the addition of 8,000 rural towns in FY22 through Project Khoj, taking the total to 40,000 towns. Further, it increased both its presence and revenues in standalone modern trade outlets with coverage expanding to 40 cities and more than 3,300 outlets. This apart, the company also activated close to 31,000 additional outlets for its healthcare products by focusing on Ayurvedic bhandars and chemist outlets.

The international business grew by eight per cent over previous year. Excluding sales from CIS region which was affected due to the prevailing geo-political uncertainty, international business grew by 17 per cent led by key geographies such as Bangladesh and UAE.

Rising inflation

According to Mohan Goenka, Vice-Chairman and Whole-Time Director, Emami, the industry is going through a rough patch with inflation at its highest, impacting consumption across rural and urban sectors. The company responded to the prevalent challenges with mix of cost control measures and judicious price increase. 

“We are further strengthening our focus on analytics and technology in sales and distribution to drive the business ahead. We are hopeful of improvement in the sector soon,” Goenka said in the statement.

“With an overall focus on digital business, we are now increasingly looking at D2C and eB2B segments and our investments in new-age start-ups are a step towards being present in the ever expanding FMCG sector. Dermicool, acquired in March’22 is also expected to strengthen our leadership position in the prickly heat and cool talc segment and add to the growth of business,” Harsha V Agarwal, Vice Chairman and Managing Director, Emami, said in the statement.

The company’s scrip closed at ₹428.80, down 4.93 per cent on the BSE on Friday.

Published on May 13, 2022