FMCG manufacturer Emami feels that Dermicool, one of the leading brands in the heat rash powder and cool talc categories, has the potential to see double-digit sales growth this summer season compared to last summer.
The company had acquired Dermicool from consumer giant Reckitt in March 2022 for a total of 432 million rupees. After the acquisition, the company became the market leader in its niche with his two major brands, Navratna Cool Talc and Dermicool.
“For Dermicool, this is the second summer after acquiring the brand. Compared to last summer season, we expect good growth for Dermicool this summer. There is potential for double-digit growth. It is now part of our distribution company,” said NH Bhansali, CEO and CFO, Finance, Strategy and Business Development, Emami Ltd.
Also read: Emami Q3 Net Profit 11.88%, Rs 260.65 million
During the last financial year, we observed that South India and Maharashtra contributed significantly to Dhamikur sales, while North India and East India were higher in case of Navratna Khur taluk. did. This has enabled us to establish a foothold in the heat rash powder and cooling talc categories across the market.
“As summer approaches, we are hopeful that both Navratnakur taluk and Dharmikul will perform well,” Bhansali said.
The company expects to record good sales growth in the fourth quarter of the current fiscal due to improved logistics, aggressive marketing and new product launches.
“We expect to see reasonable growth in the final quarter of 2024. We expect the challenges that were present in the third quarter to ease in the fourth quarter. We're also putting a lot of effort into improving, doing the right kind of aggressive marketing, and launching new products in DTC (direct-to-consumer) and mainstream. So, when you put all this together, Q4 This will help our company grow,” Bhansali said. business line.
Also read: Emami acquires 26% stake in Axiom Ayurveda
In the third quarter, the company faced challenges from weak rural demand and seasonal disruptions.
The company's revenue for Q3 FY24 increased by 1.38% year-on-year to Rs 996.32 crore as against Rs 982.72 crore in the same period of FY23.
“In the third quarter, about 65% of our revenue came from winter products. But this quarter's winter was the warmest we've had in years. All winter products were affected. The best part is… “Despite these circumstances, our market share remains intact. However, sales were primarily affected by the winter disruptions and the pain in local markets where inflation continued,” said the CEO. pointed out.
Asked about the outlook for demand in rural areas, he said that although demand growth is not as pronounced in rural markets, the company is looking forward to the future as many of the initiatives taken by the government in the past will start to take effect. He said he is doing so. “We are optimistic that the effect will be even more pronounced from the first half of the next financial year,” Bhansali added.
Emami reported an 11.88% year-on-year increase in consolidated net profit to Rs 260.65 crore in the third quarter of the current fiscal on the back of lower input costs.