Dabur India Ltd.'s quarterly profit rose, in line with estimates, and margin expanded as cost of raw materials consumed by the company fell.
Net profit attributable to shareholders of the maker of ayurvedic products rose 2% year-on-year to Rs 503.3 crore in the quarter ended December, according to an exchange filing. That compares with the Rs 503.6-crore consensus estimate of analysts tracked by Bloomberg.
Q3 FY22 Highlights (YoY)
Revenue rose 8% to Rs 2,941.8 crore, compared with the estimated Rs 2,946.3 crore.
Operating profit rose 9% to Rs 627.5 crore against the Rs 618.64-crore estimated.
Margin stood at 21.3% against 21%. Analysts had pegged it at 21%.
Raw material costs, including excise duty, fell 5.5% over the previous year and 8.5% sequentially to Rs 1,101.2 crore
Advertising spend was down 16% like most other consumer goods firms that reduced promotional expenditure amid pressure on gross margin.
Among peers that have so far announced third-quarter results, Hindustan Unilever Ltd. and Marico Ltd. reported steady profits even as volume growth slowed with inflation hurting consumers' purchasing power.
HUL, however, expanded margins through hard savings and calibrated price hikes. Dabur becomes the second staple maker to report margin expansion. The consumer goods makers have also flagged slowing rural demand. Yet, Britannia Industries Ltd. saw a 5% volume growth despite price increases and grammage cuts to offset inflationary pressures.
Shares of Dabur closed 2.01% higher ahead of the results compared with a 1.16% gain in the benchmark Nifty 50.
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