Dabur shares rally 4% on strong business updates for Q1FY25

In the update (which precedes the declaration of its quarterly results), the company said it sees mid-to-high single-digit revenue growth in Q1.

Its domestic business, a crucial driver for growth at Dabur, is set for mid-single digit volume growth.

“In India business, HPC & Healthcare segment is expected to grow in high-single digits. Travel and out of home consumption got impacted due to scorching summers, which had an impact on our beverage segment although the food (culinary) category showed good momentum,” the company said.

However, Dabur remains optimistic about growth acceleration in the coming months, particularly in rural markets. A normal monsoon and government economic initiatives are expected to fuel this growth.

The company said its "Badshah Masala" continues to be a star performer in the food category, with analysts predicting a high-teen volume growth of the product in the coming quarters.

The company currently boasts a market cap of ₹1,11,780 crore (as of July 8, 2024).

The international business anticipates growth in constant currency terms. However, severe currency depreciation in Turkey and Egypt poses a challenge for translated growth figures.

On the whole, stable commodity prices are likely to lead to an expansion in gross margins.

The company’s cost-saving initiatives and price adjustments are expected to slightly increase the operating profit, it said.

Even though Dabur has exceeded its revenue growth targets, it continues to invest heavily in brand promotion (A&P) to maintain its brand strength. Its focus currently is on expanding its distribution reach by aggressively investing in key brands.

Dabur also plans on increasing market share across its portfolio are Dabur's key focus areas.

"We continue to focus on our strategy to increase our distribution reach, invest aggressively on our key brands and drive an increase in our market shares across the portfolio,"

Financials (as of July 8, 2024):

• FY24 Sales: ₹12,404 Cr
• Market Cap: ₹1,11,780 Cr
• Return on Equity (ROE): 19.84%
• FY24 Net Profit: ₹341 Cr