Marico: Expecting Strong and Lasting Revival in FMCG Demand


Marico, an Indian multinational consumer goods company based in Mumbai, released its fourth-quarter results on April 3. While the performance was in line with analyst estimates, the overall sentiment appeared to be subdued. The company reported an annual year-on-year growth in consolidated revenue on a low single-digit basis.

Marico expects that the FMCG demand revival that it has started to see will be strong and last for several quarters. Factors such as improved macro indicators and a healthy monsoon season are seen to be the most contributory for such a revival. With regard to India business, the management reported an improvement in the year-on-year volume into the mid-single digit zone.

The company operating margins which are the main area of interest witnessed a steady improvement on a year-on-year basis and a fall in the previous quarter due to a variety of factors such as higher expenditure on brand-building activities, copra prices and crude derivatives.

Overall, Marico’s financial and year-on-year results were in line with analysts’ estimates. The management expects a strong and lasting recovery in FMCG demand which is based on a variety of improving macro indicators. With the company’s stock up 19.97% in comparison to the last closing price, public sentiment towards the company has been optimistic. Overall, the outlook for the company appears to be strong.