Marico Q1 net profit falls 16% on higher input costs

MUMBAI: Consumer products maker Marico quarterly net profit fell 16% on higher input cost and volumes declined 9% after destocking by trade in June due to GST transition.

The maker of Parachute hair oil and Saffola edible oil posted a net profit of Rs 198 crore.

Net sales decreased 5% to Rs 1405 crore and the company attributed it to the transitionary impact of GST and the subsequent pipeline reduction in trade especially in rural, wholesale channel and Canteen stores Department. Marico’s rural business declined 11% in the run up towards the new tax regime while urban sales remained flat in Q1FY18.

"While the operating performance for the quarter was below par, we continued with our renewed thrust on innovations which is evident from a slew of new launches in India," Marico’s MD Saugata Gupta said.

The company said it gained market share gains in more than 90% of the portfolio and remain optimistic about a near term recovery in volumes in India.