Emami (531162) Q1 24/25 earnings summary

Executive summary

• Q1 FY25 began positively, with consolidated revenue growing 10% year-over-year to INR 906 crore (Rs. 90,607 lacs), and PAT up 11% to INR 153 crore (Rs. 15,060 lacs), driven by strong summer portfolio performance and strategic initiatives.

• Domestic business volumes rose 8.7% and value by 10%, while international business grew 11% in constant currency, led by MENA and SAARC.

• New product launches included Dermicool for Her, Dermicool soap, Kesh King Organic Rosemary Oil & Shampoo, and digital-first Zandu products.

• Discretionary consumption was impacted by rising food prices and muted consumer confidence, but profitability was driven by volume growth and strong summer portfolio performance.

• Unaudited standalone and consolidated financial results for the quarter ended June 30, 2024, were approved by the Board on August 1, 2024.

Financial highlights

• Consolidated revenue reached INR 906 crore (Rs. 90,607 lacs), up 10% year-over-year; PAT stood at INR 153 crore (Rs. 15,060 lacs), up 11%.

• Gross margin improved to 67.7% (up 230 bps), EBITDA rose 14% to INR 216 crore (Rs. 22,697 lacs), EBITDA margin up 90 bps, PBT up 19% to INR 178 crore.

• Advertising and promotion spend up 21% YoY, now at 20.3% of revenue.

• Cost of goods sold as a percentage of revenue declined by 230 bps to 32.3%.

• Basic and diluted EPS (consolidated) for Q1 FY25 was Rs. 3.50, up from Rs. 3.13 in Q1 FY24.

Outlook and guidance

• Focus remains on sustainable, profitable, volume-led growth, expanding distribution, and investing in key brands, with continued digital-first launches and brand extensions.

• Optimism for further improvement with a normal monsoon and positive macroeconomic trends, but guidance remains cautious due to external uncertainties.

• Expectation of 5-6% volume growth and 1-2% value growth, with double-digit revenue growth possible if favorable conditions persist.

• Enhanced marketing and BTL activations expected to deepen consumer connect.

• Management expects no significant impact from unreviewed subsidiary and associate results.