Dabur Q3 beats estimates, profit rises 10%, domestic volume growth at 12.4%

FMCG company Dabur India has reported healthy numbers for October-December quarter as earnings beat analyst expectations on Thursday. Consolidated profit grew by 10.2 percent year-on-year to Rs 366 crore, which was ahead of CNBC-TV18 poll estimates of Rs 357 crore.

Profit in corresponding period last fiscal stood at Rs 332 crore.

Consolidated revenue during the quarter increased 11.8 percent year-on-year to Rs 2,199 crore with healthy domestic volume growth at 12.4 percent against 13 percent in same period last year.

"Prudent cost management initiatives coupled with strong growth in the domestic market across our key business categories helped Dabur India Ltd mitigate the weaker economic indicators and macro-economic headwinds in some international markets to deliver a strong overall performance in the third quarter of 2018-19 financial year," the company said.

A CNBC-TV18 poll estimates for revenue stood at Rs 2,169 crore and domestic volume growth at 8-10 percent.

Dabur's shampoo business grew by 25.2 percent and hair oil business was up 23.6 percent, helping the hair care category report a nearly 24 percent growth during the quarter.

The skin & salon business ended the quarter with a 19.3 percent growth, while the OTC & ayurvedic ethicals business grew by 17.6 percent.

Dabur's toothpaste sales, led by continued demand for flagship Dabur Red Paste, was up 11.1 percent while the foods business also grew by 11.1 percent.

Sunil Duggal, Chief Executive Officer, said, "The medium-term prospects for India remain robust and we are confident that domestic consumer sentiment, particularly in rural markets, will gain pace in the months to come on the back of fiscal stimulus."

At operating level too, numbers were ahead of estimates. Consolidated EBITDA (earnings before, interest, tax, depreciation and amortisation) in Q3 increased 4.3 percent to Rs 445.2 crore, but margin contracted to 20.2 percent against 20.5 percent YoY.

A CNBC-TV18 poll expectations for EBITDA stood at Rs 433 crore and margin at 20 percent for the quarter.

SP Tulsian of sptulsian.com told CNBC-TV18 that Dabur reported very good numbers for the quarter. "Considering the good rabi crop season and likely continuity in rural consumption growth, Dabur is expected to trade strong going ahead."

Even if it does 10 percent volume growth, numbers are expected to remain good going ahead, according to him.

The stock was quoting at Rs 433, up Rs 2.15, or 0.50 percent on the BSE, at 14:48 hours IST.

Source: https://www.moneycontrol.com/news/business/earnings/dabur-q3-beats-estimates-profit-rises-10-domestic-volume-growth-at-12-4-3462671.html

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