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Dabur India Ltd. Q4FY21- Conference Call Transcript | Yadnya Investment Academy

Dabur India Ltd. Q4FY21- Conference Call Transcript | Yadnya Investment Academy

Published on 18 May 2021 Views 101 Comments 0

FY21 Highlights:

  • Consolidated revenue of the company grew by 10% YoY to Rs. 9,562 Cr.
  • Profit after tax increased by 17.2% to touch Rs.1,693 crores.
  • The Company crossed gross sales mark of Rs. 10,000 Cr. for the first time.
  • Company added Rs. 500 crores to the Health Supplement portfolio which includes iconic brands of Dabur Honey and Dabur Chyawanprash in a single year.

Category-Wise Performance:

  • The Healthcare portfolio recorded a growth of 23% in Q4 driven by creative contextual marketing campaigns, localized field activations, and sustained investments behind brands.
  • Dabur Chyawanprash gained a market share of 170 basis points while Dabur Honey gained 230 basis points in Honey Category in the market.
  • The Digestive portfolio posted a 20% growth on account of improvement in mobility and out-of-home consumption.
  • OTC business posted a very strong robust growth of 34% on the back of good performance of Lal Tail, Shilajit, and NPDs like Health Drops, Health Juices, and other Ayurvedic products.
  • Oral care was a star performer recording a stellar 42% growth.
  • Recently launched NPDs like, Dabur Dant Rakshak and Dabur Herbal range of toothpaste continue to do well.
  • The Hair Oil portfolio had a good quarter reporting a growth of 25% on the back of double-digit growth in perfumed oils and coconut oil portfolio.
  • Homecare marked a turnaround during the quarter, growing by 24% with all brands reporting a smart recovery in demand.
  • Skincare portfolio witnessed a growth of 38% driven by strong growth across the portfolio. There was a good revival in Fem and Oxy's portfolio as well.
  • The food and Beverage business improved significantly, reporting a growth of 28%. In the Beverage business, both in-home businesses and out-of-home consumption reported strong performance.
  • The new products launched under the Food and Beverage portfolio like Real Mango Drink, Real Frappe Milkshake, Homemade Chutneys, and Pickles range continue to see very good traction in the market.

E-Commerce:

  • E-commerce continues to be an outperformer with growth of 2x.
  • This channel now contributes around 5% to 6% of the company’s sales.
  • The company is having a focus on the digital and e-commerce side to have more connectivity with customers.
  • Dabur recently launched e-commerce first innovations such as Apple Cider Vinegar, Baby Care range, Value-added Honey performed very well.

Gross Margins- Standalone:

  • The Company has reported compression in the domestic business because the company has seen an unprecedented kind of inflation and this inflation is in the tune of around 5% to 6% in the overall business and spanning across the entire product portfolio.
  • First of all, Agri commodities have gone up and we have Herbs and Spices in Agri commodities where there has been huge inflation whether it is an amla, fruit or it’s vegetable oils.
  • The second bucket is hydrocarbon link with the fossil fuel link - packaging material, raw material where the company has seen a huge spike because petroleum rates are much higher as compared to last year.
  • Third is specialty chemical is also higher for the company.
  • Inflation has been passed to the consumers by way of 3% of the price increase.
  • Further, looking at the current scenario, the company can go for another round of price hikes to mitigate the impact of inflation.
  • The company has also embarked on cost optimization products.
  • Dabur has also adopted Samriddhi, a cost-saving initiative by the company.

A&P:

  • The company is committed to being increasing our demand-related activities and advertising is a very important part of building demand, not just for power brands to gain market share.
  • The company is committed to internal volume growth and also to new products.

Food & Beverage Business:

  • The company has separated the business into food & beverages.
  • The company is focusing especially on the food for scaling up the Homemade Brand.
  • Dabur has also set the target of marking the milestone level of Rs. 100 Cr. in next financial year and Rs. 500 Cr. in the next 4-5 years for Homemade Brand.
  • The company has also got into the sauces and the condiment segment.

International Business:

  • MENA business of the company has grown by 24% in the year on the back of a recovery in MENA.
  • US business has a rebound and growing at double digits with Dollar-denominated and doing well with better profitability.
  • Nepal business is doing well, registering a growth of 21%.
  • Bangladesh business trended up 46% and Egypt business has grown by around 21% which is doing exceedingly well for the company.

Direct Reach:

  • In FY21, the company has achieved the set target of 1.3 million outlets.
  • Further, the company also set the target to the number of outlets to 1.4 million by next fiscal year.
  • In terms of rural reach also, the company has achieved the target of reaching 60,000 villages in FY21. The next target for the company in FY22 is reaching 80,000 villages.
  • The company has created a separate vertical of e-commerce and modern trade.
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