Emami’s D2C push, premium acquisitions can drive FY25 goals

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Subscribe to enjoy similar stories. Emami Ltd is gearing up for a better FY25, eyeing double-digit domestic revenue growth after clocking a 4% increase in FY24. So, what’s the game plan? More focus on direct-to-consumer (D2C).

Emami recently acquired the remaining 49.6% stake in The Man Company for ₹180 crore, cementing its position in the premium male grooming market—a segment that's doing well as men become more conscious about grooming. Emami aims to scale The Man Company’s revenue to ₹500 crore over the next three years. In FY24, Emami's consolidated revenue was ₹3,578 crore with domestic business contributing over 80%.

The FMCG company is also tapping into the booming pet wellness trend, taking a stake in Cannis Lupus. The company is set to launch natural and ayurvedic products under the ‘Fur Ball Story’ brand. With a zero-debt status and healthy cash pile, Emami has the flexibility to invest.

It plans to inject over ₹200 crore into new categories like healthcare and nutrition. This suggests a strategic pivot to align with changing consumer trends. As such, modern trade and e-commerce now account for about 22% of Emami's domestic revenue, a leap from just 5% five years ago.

Further, to fuel growth, Emami has a steady pipeline of digital-first product launches in FY25, aiming to drive overall volume growth to 6-7%. The company expects lower raw material costs to aid gross margin expansion, but substantial rise in advertising and promotional spends could curb Ebitda margin increase. Meanwhile, the La Niña effect, bringing above-normal rainfall and a potentially cold winter, is expected to boost demand for Emami's winter and healthcare portfolios.