During the quarter, the average market price of the domestic copra was down 25 per cent YoY. Other key input prices for the India business- rice bran oil, liquid paraffin (LLP) and HDPE, too, were down 12 per cent, 1 per cent and 21 per cent, respectively on a YoY basis.
"The company aims for a volume growth of 8-10 per cent and a topline growth of 13-15 per cent, subject to inflation, over the medium term. It, however, expects volume and value growth in FY20 to be in high single digits," the management said in a statement.
Analysts at HDFC Securities remain constructive on Marico
and believe its performance will be superior relative to its peers in FY20 on the back of the copra deflationary cycle and plans to capitalise by building its futuristic portfolio.
“With 25 per cent decline in copra prices, the company has been leveraging that benefit in increasing its A&P spend to propel growth in struggling and newer categories. We believe foods, male grooming and skin care categories would be the future growth driver for the company. Moreover, benign raw material cost would continue to help the company maintain elevated margins,” analysts at ICICI Securities said in a report. The brokerage firm maintains ‘buy’ recommendation on the stock with a target price of Rs 425.
At 12:25 pm, Marico was quoting at a per cent higher at Rs 398 on the BSE, as compared to a 0.83 per cent gain in the S&P BSE Sensex. A combined 1.7 million shares changed hands on the counter on the NSE and BSE, till the time of writing this report.