Capitaline

Results 01-Feb-24

Analysis

Godrej Consumer Products

NP up 6.36%

For the quarter ending Dec 2023, consolidated Net sales (including other operating income) of Godrej Consumer Products has increased 1.69% to Rs 3659.64 crore compared to quarter ended Dec 2022. Sales of India segment has gone up 9.67% to Rs 2,204.12 crore (accounting for 59.68% of total sales). Sales of Indonesia segment has gone up 7.66% to Rs 466.53 crore (accounting for 12.63% of total sales). Sales of Africa segment fell 90.77% to Rs 923.25 crore (accounting for 25.00% of total sales). Sales of Others segment has gone down 45.66% to Rs 99.31 crore (accounting for 2.69% of total sales). Inter-segment sales came down from Rs 34.01 crore to Rs 33.57 crore.

Profit before interest, tax and other unallocable items (PBIT) has jumped 20.21% to Rs 877.79 crore. PBIT of India segment rose 20.65% to Rs 676.19 crore (accounting for 77.03% of total PBIT). PBIT of Indonesia segment rose 23.09% to Rs 116.63 crore (accounting for 13.29% of total PBIT). PBIT of Africa segment rose 32.83% to Rs 82.50 crore (accounting for 9.40% of total PBIT). PBIT of Others segment fell 80.90% to Rs 2.47 crore (accounting for 0.28% of total PBIT).

PBIT margin of India segment rose from 27.89% to 30.68%. PBIT margin of Indonesia segment rose from 21.87% to 25.00%. PBIT margin of Africa segment rose from 0.62% to 8.94%. PBIT margin of Others segment fell from 7.07% to 2.49%. Overall PBIT margin rose from 5.78% to 23.77%.

Operating profit margin has jumped from 20.19% to 22.97%, leading to 15.70% rise in operating profit to Rs 840.72 crore. Raw material cost as a % of total sales (net of stock adjustments) decreased from 42.87% to 40.00%. Purchase of finished goods cost rose from 2.40% to 3.02%. Employee cost decreased from 8.67% to 7.69%. Other expenses rose from 24.46% to 25.87%. Selling and administration expenses rose from 8.20% to 9.56%.

Other income rose 62.41% to Rs 70.08 crore. PBIDT rose 18.32% to Rs 910.8 crore. Provision for interest rose 66.81% to Rs 66.59 crore.

PBDT rose 15.67% to Rs 844.21 crore. Provision for depreciation fell 6% to Rs 53.88 crore.

Profit before tax grew 17.51% to Rs 790.33 crore. Share of profit/loss were nil in both the periods. Extraordinary items were increased to Rs -6.89 crore. Provision for tax was expense of Rs 202.38 crore, compared to Rs 118.77 crore. Effective tax rate was 25.83% compared to 17.86%.

Minority interest was nil in both the periods. Net profit attributable to owners of the company increased 6.36% to Rs 581.06 crore.

Promoters’ stake was 63.21% as of 31 December 2023 ,compared to 63.21% as of 31 December 2022 . Promoters pledged stake was 0.66% as of 31 December 2023 ,compared to 0.66% as of 31 December 2022 .

For year-to-date (YTD) results analysis.

Net sales (including other operating income) of Godrej Consumer Products has increased 5.88% to Rs 10710.5 crore. Sales of India segment has gone up 9.13% to Rs 6,377.82 crore (accounting for 58.95% of total sales). Sales of Indonesia segment has gone up 14.09% to Rs 1,390.18 crore (accounting for 12.85% of total sales). Sales of Africa segment fell 2.15% to Rs 2,587.62 crore (accounting for 23.92% of total sales). Sales of Others segment has gone down 9.49% to Rs 462.71 crore (accounting for 4.28% of total sales). Inter-segment sales rose Rs 102.71 crore to Rs 107.82 crore.

Profit before interest, tax and other unallocable items (PBIT) has jumped 41.96% to Rs 2,500.15 crore. PBIT of India segment rose 41.86% to Rs 1,992.38 crore (accounting for 79.69% of total PBIT). PBIT of Indonesia segment rose 40.43% to Rs 317.41 crore (accounting for 12.70% of total PBIT). PBIT of Africa segment rose 64.65% to Rs 176.46 crore (accounting for 7.06% of total PBIT). PBIT of Others segment fell 40.72% to Rs 13.90 crore (accounting for 0.56% of total PBIT).

PBIT margin of India segment rose from 24.03% to 31.24%. PBIT margin of Indonesia segment rose from 18.55% to 22.83%. PBIT margin of Africa segment rose from 4.05% to 6.82%. PBIT margin of Others segment fell from 4.59% to 3.00%. Overall PBIT margin rose from 17.23% to 23.11%.

Operating profit margin has jumped from 17.69% to 20.43%, leading to 22.25% rise in operating profit to Rs 2,187.75 crore. Raw material cost as a % of total sales (net of stock adjustments) decreased from 47.99% to 40.72%. Purchase of finished goods cost rose from 2.56% to 4.57%. Employee cost increased from 8.15% to 8.62%. Other expenses rose from 23.31% to 25.72%. Selling and administration expenses rose from 7.65% to 9.59%.

Other income rose 85.54% to Rs 205.1 crore. PBIDT rose 25.93% to Rs 2392.85 crore. Provision for interest rose 76.82% to Rs 217.9 crore.

PBDT rose 22.40% to Rs 2174.95 crore. Provision for depreciation rose 13.92% to Rs 191.05 crore.

Profit before tax grew 23.29% to Rs 1,983.90 crore. Share of profit/loss were nil in both the periods. Extraordinary items were decreased to Rs -101.21 crore. Provision for tax was expense of Rs 550.04 crore, compared to Rs 326.9 crore. Effective tax rate was 29.22% compared to 20.73%.

Minority interest was nil in both the periods. Net profit attributable to owners of the company increased 6.58% to Rs 1,332.65 crore.

Promoters’ stake was 63.21% as of 31 December 2023 ,compared to 63.21% as of 31 December 2022 . Promoters pledged stake was 0.66% as of 31 December 2023 ,compared to 0.66% as of 31 December 2022 .

Full year results analysis.

Net sales (including other operating income) of Godrej Consumer Products has increased 8.47% to Rs 13315.97 crore. Sales of India segment has gone up 10.29% to Rs 7,667.16 crore (accounting for 56.99% of total sales). Sales of Indonesia segment has gone down 3.06% to Rs 1,653.03 crore (accounting for 12.29% of total sales). Sales of Africa (including strength of Nature) segment rose 11.97% to Rs 3,414.67 crore (accounting for 25.38% of total sales). Sales of Others segment has gone down 4.39% to Rs 717.83 crore (accounting for 5.34% of total sales). Inter-segment sales came down from Rs 180.76 crore to Rs 136.72 crore.

Profit before interest, tax and other unallocable items (PBIT) has jumped 5.16% to Rs 2,410.20 crore. PBIT of India segment rose 11.01% to Rs 1,900.56 crore (accounting for 78.85% of total PBIT). PBIT of Indonesia segment fell 14.10% to Rs 330.75 crore (accounting for 13.72% of total PBIT). PBIT of Africa (including strength of Nature) segment rose 29.52% to Rs 136.88 crore (accounting for 5.68% of total PBIT). PBIT of Others segment fell 52.85% to Rs 42.01 crore (accounting for 1.74% of total PBIT).

PBIT margin of India segment rose from 24.63% to 24.79%. PBIT margin of Indonesia segment fell from 22.58% to 20.01%. PBIT margin of Africa (including strength of Nature) segment rose from 3.47% to 4.01%. PBIT margin of Others segment fell from 11.87% to 5.85%. Overall PBIT margin fell from 18.40% to 17.92%.

Operating profit margin has declined from 19.52% to 18.25%, leading to 1.44% rise in operating profit to Rs 2,430.46 crore. Raw material cost as a % of total sales (net of stock adjustments) increased from 46.87% to 47.20%. Purchase of finished goods cost fell from 2.87% to 2.33%. Employee cost decreased from 8.95% to 8.48%. Other expenses rose from 21.89% to 23.44%. Selling and administration expenses rose from 6.09% to 7.52%. Loss on forex transaction rose from 0.78% to 0.83%.

Other income rose 87.73% to Rs 168.41 crore. PBIDT rose 4.55% to Rs 2598.87 crore. Provision for interest rose 59.53% to Rs 175.74 crore. Loan funds declined from Rs 1,704.34 crore as of 31 March 2022 to Rs 1,129.58 crore as of 31 March 2023. Inventories declined from Rs 2,129.85 crore as of 31 March 2022 to Rs 1,537.15 crore as of 31 March 2023. Sundry debtors were higher at Rs 1,245.28 crore as of 31 March 2023 compared to Rs 1,116.32 crore as of 31 March 2022. Cash and bank balance declined from Rs 1,107.77 crore as of 31 March 2022 to Rs 390.72 crore as of 31 March 2023. Investments rose to Rs 3,028.98 crore as of 31 March 2023 from Rs 1,015.43 crore as of 31 March 2022 .

PBDT rose 2% to Rs 2423.13 crore. Provision for depreciation rose 12.08% to Rs 236.29 crore. Fixed assets increased to Rs 4,156.83 crore as of 31 March 2023 from Rs 3,958.95 crore as of 31 March 2022. Intangible assets increased from Rs 5,376.79 crore to Rs 5,822.25 crore.

Profit before tax grew 1.02% to Rs 2,186.84 crore. Share of profit/loss were nil in both the periods. Extraordinary items were decreased to Rs -54.11 crore. Provision for tax was expense of Rs 430.27 crore, compared to Rs 371.87 crore. Effective tax rate was 20.17% compared to 17.25%.

Minority interest was nil in both the periods. Net profit attributable to owners of the company decreased 4.54% to Rs 1,702.46 crore.

Equity capital increased from Rs 102.26 crore as of 31 March 2022 to Rs 102.27 crore as of 31 March 2023. Per share face Value remained same at Rs 1.00.

Promoters’ stake was 63.21% as of 31 March 2023 ,compared to 63.22% as of 31 March 2022 . Promoters pledged stake was 0.66% as of 31 March 2023 ,compared to 0.66% as of 31 March 2022 .

Cash flow from operating activities increased to Rs 2,150.65 crore for year ended March 2023 from Rs 1,450.57 crore for year ended March 2022. Cash flow used in acquiring fixed assets during the year ended March 2023 stood at Rs 227.40 crore, compared to Rs 276.52 crore during the year ended March 2022.

Other Highlights

In Q3 FY24, India business sales grew by 9% year-on-year led by volume growth of 12%. Indonesia sales grew by 8% in INR terms and 7% in constant currency terms, year-on-year. Africa, USA and Middle East sales declined by 8% in INR terms and grew by 14% in constant currency terms on YoY basis. Latin America & SAARC sales declined by 45% in INR and grew by 181% in constant currency terms on YoY basis.

In Q3 FY24, Homecare increased by 5% and personal care up by 2% on YoY basis.

Management Comments :
Sudhir Sitapati, Managing Director, and CEO, GCPL, said:” We continue to deliver steady performance in Q3FY24 despite challenging market conditions. Our Consolidated volumes grew by 8%, led by the India business growing volumes at 12% and Indonesia growing volumes at 9%. Our Consolidated revenue growth was significantly impacted by the devaluation of the Naira and the Argentine Peso with sales growing at 2% in INR terms and 19% in constant currency terms. Our quality of profit continues to improve consistently on the back of superior growth in higher margin countries and categories. Our reported Consolidated gross margin improved sharply by 470 bps year-on-year and 100 bps quarter-on-quarter. Our EBITDA margin, too, improved by 280 bps year-on-year despite continued media investments, which increased by 32% year-on-year. We continue to remain focused on driving volume-led growth along with healthy investments in our brands and improvement in profitability. We have launched two new products in the Indian market. (1) Godrej Fab Liquid Detergent, at a category-defining price of 99 per litre. (2) We have entered the ~ 1,200 crore market of Anti-Mosquito Incense Sticks segment that is dominated by illegal players. Goodknight Agarbatti is India`s only government registered active based anti-mosquito Agarbatti with our new and exclusive molecule RNF (-2x more effective than other molecules used in India). We continue to have a strong balance sheet. We are on track in our journey to reduce wasted cost and are deploying this to drive profitable and sustainable volume growth across our portfolio through category development. We remain committed to our purpose of bringing the goodness of health and beauty to consumers in emerging markets.”

Godrej Consumer Products : Consolidated Results

	Quarter ended			Year to Date			Year ended
Particulars	202312	202212	Var.(%)	202312	202212	Var.(%)	202303	202203	Var.(%)
Net Sales (including other operating income)	3,659.64	3,598.92	1.69	10,710.50	10,115.81	5.88	13,315.97	12,276.50	8.47
OPM (%)	22.97	20.19	278 bps	20.43	17.69	274 bps	18.25	19.52	-126 bps
OP	840.72	726.64	15.70	2,187.75	1,789.55	22.25	2,430.46	2,396.01	1.44
Other Inc.	70.08	43.15	62.41	205.10	110.54	85.54	168.41	89.71	87.73
PBIDT	910.80	769.79	18.32	2,392.85	1,900.09	25.93	2,598.87	2,485.72	4.55
Interest	66.59	39.92	66.81	217.90	123.23	76.82	175.74	110.16	59.53
PBDT	844.21	729.87	15.67	2,174.95	1,776.86	22.40	2,423.13	2,375.56	2.00
Depreciation	53.88	57.32	-6.00	191.05	167.7	13.92	236.29	210.83	12.08
PBT	790.33	672.55	17.51	1983.9	1609.16	23.29	2186.84	2164.73	1.02
Share of Profit/(Loss) from Associates	0	0	-	0	0	-	0	0.28	-
PBT before EO	790.33	672.55	17.51	1983.9	1609.16	23.29	2186.84	2165.01	1.01
EO Income	-6.89	-7.44	7.39	-101.21	-31.94	-216.88	-54.11	-9.75	-454.97
PBT after EO	783.44	665.11	17.79	1882.69	1577.22	19.37	2132.73	2155.26	-1.05
Taxation	202.38	118.77	70.40	550.04	326.9	68.26	430.27	371.87	15.70
PAT	581.06	546.34	6.36	1332.65	1250.32	6.58	1702.46	1783.39	-4.54
Minority Interest (MI)	0	0	-	0	0	-	0	0	-
Net profit	581.06	546.34	6.36	1332.65	1250.32	6.58	1702.46	1783.39	-4.54
P/(L) from discontinued operations net of tax	0	0	-	0	0	-	0	0	-
Net profit after discontinued operations	581.06	546.34	6.36	1332.65	1250.32	6.58	1702.46	1783.39	-4.54
EPS (Rs)*	5.73	5.40	6.10	13.73	12.47	10.09	17.07	17.52	-2.56

* EPS is on current equity of Rs 102.28 crore, Face value of Rs 1, Excluding extraordinary items.
# EPS is not annualised
bps : Basis points
EO : Extraordinary items
Figures in Rs crore
Source: Capitaline Corporate Database

Godrej Consumer Products : Consolidated Segment Results

	Quarter ended				Year to Date				Year ended
	% of (Total)	202312	202212	Var.(%)	% of (Total)	202312	202212	Var.(%)	% of (Total)	202303	202203	Var.(%)
Sales
India	59.68	2,204.12	2,009.80	9.67	58.95	6,377.82	5,844.24	9.13	56.99	7,667.16	6,951.56	10.29
Indonesia	12.63	466.53	433.32	7.66	12.85	1,390.18	1,218.49	14.09	12.29	1,653.03	1,705.19	-3.06
Africa	25.00	923.25	10,007.05	-90.77	23.92	2,587.62	2,644.58	-2.15	25.38	3,414.67	3,049.74	11.97
Others	2.69	99.31	182.76	-45.66	4.28	462.71	511.21	-9.49	5.34	717.83	750.77	-4.39
Total Reported Sales	100.00	3,693.21	12,632.93	-70.77	100.00	10,818.33	10,218.52	5.87	100.00	13,452.69	12,457.26	7.99
Less: Inter segment revenues		33.57	34.01	-1.29		107.82	102.71	4.98		136.72	180.76	-24.36
Net Sales	100.00	3,659.64	12,598.92	-70.95	100.00	10,710.51	10,115.81	5.88	100.00	13,315.97	12,276.50	8.47
PBIT
India	77.03	676.19	560.44	20.65	79.69	1,992.38	1,404.51	41.86	78.85	1,900.56	1,712.00	11.01
Indonesia	13.29	116.63	94.75	23.09	12.70	317.41	226.02	40.43	13.72	330.75	385.05	-14.10
Africa	9.40	82.50	62.11	32.83	7.06	176.46	107.17	64.65	5.68	136.88	105.68	29.52
Others	0.28	2.47	12.93	-80.90	0.56	13.90	23.45	-40.72	1.74	42.01	89.10	-52.85
Total PBIT	100.00	877.79	730.23	20.21	100.00	2,500.15	1,761.15	41.96	100.00	2,410.20	2,291.83	5.16
Less : Interest		0.00	39.92	-		0.00	123.23	-		175.74	110.16	59.53
Add: Other un-allcoable		-94.35	-25.20	-274.40		-617.46	-60.70	-917.23		-101.73	-26.41	-285.20
PBIT Margin(%)
India		30.68	27.89	279.31		31.24	24.03	720.68		24.79	24.63	16.08
Indonesia		25.00	21.87	313.34		22.83	18.55	428.31		20.01	22.58	-257.24
Africa		8.94	0.62	831.52		6.82	4.05	276.70		4.01	3.47	54.34
Others		2.49	7.07	-458.77		3.00	4.59	-158.31		5.85	11.87	-601.55
PBT	100.00	783.44	665.11	17.79	100.00	1,882.69	1,577.22	19.37	100.00	2,132.73	2,155.26	-1.05

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