Subscribe to enjoy similar stories. It was a foregone conclusion that Dabur India Ltd’s September quarter (Q2FY25) results would disappoint, as the company’s business update earlier this month had already cautioned of a weak quarter. Unsurprisingly, Dabur’s shares reacted with only a muted response.
Read this | Dabur's September-quarter update pours cold water on market hopes Consolidated revenue was down 5.5% year-on-year to ₹3,029 crore in Q2 due to inventory correction and seasonality factors. Over the past few quarters, organized channels such as E-commerce, quick commerce have been growing rapidly leading to a rise in inventory levels in the general trade (GT) channel. Thus, Dabur took a strategic call to rationalize inventory in the GT channel to enhance channel partners’ return on investment.
This hurt primary sales in the India business. Management commentary based on secondary sales indicated a 2.3% growth in India business, largely weighed down by an 11% year-on-year drop in juice sales. “The Juices category was impacted by extreme weather (heavy rains) and high food inflation leading to less preference for high-ticket/discretionary items, which we believe benefited low-ticket imperfect substitutes such as carbonated drinks," wrote Mihir P.
Shah, analyst at Nomura Financial Advisory and Securities (India) in a report on 31 October. In the domestic market, Dabur’s home & personal care (HPC) and healthcare businesses saw secondary sales growth of 6% and 4%, respectively. Within HPC, Dabur's oral care segment grew by 5%, trailing peers Colgate and Hindustan Unilever Ltd.
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