Marico is one of the renowned consumer goods companies in India that offers a variety of products as well as services in the fields of beauty and health. The headquarters are located in Mumbai, Maharashtra and hold various brands like Zatak, Saffola, Parachute, Hair&Care, Kaya Limited, Nihar, Revive, Mediker, Set Wet, Caivil, Livon, HairCode, Black Chic, Fiancee, X-Men, Code 10, Eclipse, and Manjal. However, Marico’s flagship brand is Parachute.
The market capitalization of Marico Limited is above Rs.38,000 crore, as of March 2018.
Company’s Wealth and PerformanceQ1 FY 2018-19
- For the quarter ended on June 30, 2018, Marico Limited reported its consolidated revenue from operations to be at Rs.2,027 crore, in comparison to Rs.1,693 crore reported for the same quarter of the previous year. This marked an increase of 20% y-o-y.
- The company’s India business registered a volume growth of 12% while its international business grew by 3% y-o-y.
- The FMCG giant reported a consolidated profit after tax of Rs.256 crore - an increase of 10% y-o-y. The company reported its EBITDA to be at Rs.355 crore - an improvement of 9% with respect to the same quarter of the previous year.
- Consequently, the company’s earnings per share (EPS) improved from Rs.1.80 to Rs.1.98 y-o-y.
- For the year ended on March 31, 2018, Marico Limited, in its regulatory filings, said that its consolidated income from operations stood at Rs.6,333 crore. In comparison to the previous year, this marked a growth 7%.
- For the same period, the company’s EBITDA was down by 2% to Rs.1,138 crore.
- The company’s domestic business grew in value by 9% while its international business registered a modest growth of 1%.
- The EBITDA was down by 2% y-o-y to Rs.1,138 crore whereas its profit after tax appreciated by 2% to 814 crore.
- For the financial year 2017-18, the company’s non-current liabilities were worth Rs.68.47 crore. For the same period, its basic earnings per share improved from Rs.6.21 to Rs.6.32.
- Marico Limited released its consolidated financial statements for the third-quarter of the fiscal year 2018. The report mentioned that the company gained a total revenue of Rs.1,624 crore and grew by 15%.
- While the EBITDA (Earnings before Interest, Taxes, Depreciation, and Amortization) grew by 11% at a total of at Rs.302 crore, the EBITDA margin is down by 66 basis points for the quarter.
- The PAT (Profit after Tax) for Q3 FY 2018 is Rs.221 crore, owing it to the healthy sales and resilient marginal performance.
- With eight factories located across India, the company generates a turnover between Rs.2000 and Rs.5000 crore or more.
- Marico is one of the business leaders in the field of premium edible oils and coconut hair oil with a market share of 67% and 59% respectively.
Marico Limited Stock Trends In 2018
- The year 2018 opened with the stock trading at Rs.322.50 and kept fluctuating for the next few days. But gradually, the prices began to decline and the month ended with a closing price of Rs.314.90.
- The share price of Marico Limited on the initial day of February 2018 was close to Rs.305 but due to weak sales in the business, the price fell down close to Rs.295 in the next few days. But soon in the middle of the month, the market gained and the stock gained its value back to Rs.315.
- On March 2018, the stock was trading close to Rs.308 and kept hovering for the next few days with a steady sales in the beauty and healthcare business.
- During Q1 FY 2018, the company earned a total income of Rs.1,692 crore with a decline in growth by 2%. The EBITDA also plummeted by 13% with a declination in the margin value of 215 basis points. When compared to the first-quarter of FY 2017, the PAT declined by 12% at Rs.232 crore.
- During Q2 FY 2018, the business made a revenue of Rs.1,536 crore with a 6% growth from the second-quarter of FY 2017. The company saw not only satisfactory sales performances but also a spike in the total market share. However, the EBITDA margin was down by 68 basis points and the EBITDA income was Rs.259 crore.
- During Q3 FY 2018, the company made a revenue of Rs.1,624 crore with a growth of 15% from the third-quarter of FY 2017. With EBITDA of Rs.302 crore and PAT of Rs.221 crore, Marico saw a healthy growth in sales and the business continued to grow in terms of market share.
- In February 2018, the company announced an interim dividend of 250%. The scrip commenced the month of March at levels above Rs.305. By the end of the month, the shares managed to gain a little over 8%. The closing price on March 31, 2018, was Rs.326.05 on the NSE.
- Over the course of April, the share price of Marico Limited went down marginally. The shares commenced the month trading at Rs.327.25 and eventually, they descended into the Rs.310 region. The losses weren’t that discernible and the closing price at the end of the month was Rs.332.55.
- Things didn’t change considerably in the month of May. The shares were seen trading hands at levels varying from Rs.310 to Rs.325. Needless to mention, the scrip didn’t incur any sharp gains or losses in this period.
- It wasn’t until the month of June that the prices exhibited a bullish trend. On June 1, the stock price of Marico Limited was Rs.323.50 on the NSE. Driven by positive sentiments and developments in the company, the shares moved up to ascend into the Rs.340 region. The prices continued to rise over the course of July as well. It was a steady, gradual increase which helped the shares cross the psychologically important mark of Rs.350.
- In late July, the shares were seen trading hands at levels above Rs.350. The scrip continued to move up in the month of August as well. By this point, the shares had appreciated by a little over 15% since the start of the year. In the same month, they also hit their 52-week high at Rs.387.85 on the NSE.
- However, the scrip failed to find momentum at those levels and eventually, they descended back to their previous levels at Rs.350. As of mid-September, the shares were traded at levels varying from Rs.340 - Rs.350.
Marico Limited Stock Trends In 2016 and 2017
- During Q1 FY 2016, Marico achieved a revenue of Rs.1,783 crore and inclined by 10% from the first-quarter of the previous fiscal year. The EBITDA also inclined by 22% with a revenue of Rs.325 crore and a marginal value of 18.2%. The PAT (Profit after Tax) for the quarter was Rs.238 crore, owing it to the strong rural sales.
- During Q2 FY 2016, the company gained a revenue of Rs.1,485 crore and grew by 4% from the second-quarter of the last fiscal year. The national business inclined by 4% and the international market grew by 2%. The EBITDA increased by 18% with a revenue of Rs.230 crore and a marginal value of 15.5%. The PAT for the quarter was Rs.151 crore, which was low when compared to the last quarter but definitely a great boost while comparing it to the second-quarter of the last financial year.
- The second-quarter of FY 2016 ended with Marico achieving the title of “Best Domestic Company for Corporate Governance” from a survey conducted by Asiamoney.
- During Q3 FY 2016, the company achieved a revenue of Rs.1,556 crore and grew by 7% from the third-quarter of the previous fiscal year. The sales in India recorded a strong volume from its customers whereas the international market showed a constant growth of 8%. Also, this was the quarter when the company gained a double-digit growth in terms of volume after nine quarters. The EBITDA made a revenue of Rs.294 crore with a margin of 18.9%. The PAT for the quarter was Rs.198 crore, which is not only high from the last quarter but also inclined by 24% from Q3 FY 2015.
- During Q4 FY 2016, Marico attained a revenue of Rs.1,307 crore and grew by 7% from the fourth-quarter of the last fiscal year. With PAT of Rs.138 crore and EBITDA income of Rs.217 crore, the company endeavored to have a strong dividend payout ratio based on the fund necessities towards expansion. The quarter saw a strong sales performance in the brands – Saffola, Hair Oils and a medium growth in Parachute.
- During Q1 FY 2017, Marico made a revenue of Rs.1,754 crore (Indian market: Rs.1,387 crore and International market: Rs.367 crore) whose sales volume increased by 8% and 4% respectively. The growth in value was uniform when comparing it to the Q1FY16 results and this was due to the cost reductions in Parachute portfolio. The EBITDA made a revenue of Rs.374 crore and grew by 18% with a margin of 21.3%.
- During Q2 FY 2017, the company achieved a revenue of Rs.1,443 crore, which declined by 1% when compared to Q2 FY 2016. However, the business reported a growth of 3.4%, owing it to the healthy sales of Saffola vegetable oil. The EBITDA margin grew by 179 BS (Basis Points), which is 17.5%.
- During Q3 FY 2017, Marico witnessed an unparalleled demonetization event of Rs.500 and Rs.1,000 notes in India. This severely impacted both the rural and wholesale trade, as they were dependent heavily on cash. But the eastern and northern regions were badly hit. Therefore, the revenue was only Rs.1,417 crore and this led to a declination in the growth by 7%.
- During Q4 FY 2017, the impact of demonetization continued and the company made an income of Rs.1,322 crore with a 2% growth from the previous quarter. The profit after tax for the quarter was Rs.169 crore and with this, the overall growth in value was lower due to the pending price reductions of Parachute portfolio.
Should You Invest in Marico Limited?
- For a long-term stock investment (for 5 years or more), Marico Limited is one of the decent choices because the probability of making the investment double is high, even if there is no security in the share market.
- Before making an investment, search for companies that have a good management and see how their growths are.
- Be updated with the latest market events and trends, as these will give an extra help. Begin with a company or industry that you as an investor are aware of because you know how your favorite brand is doing in the market.
- Once, you are convinced with the company, pay keen attention to the investor presentations and quarterly financial results, as they give a basic idea whether to put your money or not.
- As an investor, decide if you want dividends or value investments like a low PE, as these factors will help you come up with the right choice.
Marico is one of the leading consumer products firms in India, which operates in the wellness and beauty sectors. Empowered with opportunity and space, the company works to makes a huge difference in the lives of its stakeholders (consumers, associates, members, investors, and the society).
Marico has its presence in more than 25 countries across Africa and Asia. It has nurtured various brands in the fields of skin care, hair care, healthy foods, fabric care, male grooming, edible oils, etc. Their international business provides unique brands, which are localized to satisfy the lifestyle requirements of international customers.
The company adopts strict quality systems, healthy food safety systems, and improved manufacturing practices for all its products. Their Edible Oil and Food units are certified under FSSC 22000, even including FSSC 22000, ISO/TS 22002-1, and ISO 22000:2005.
Marico’s manufacturing plants are certified with GMP, ISO 9001, 18000, 14000, and 22716. Every unit features a sophisticated testing and analytical laboratory that is certified by the National Accreditation Board for Testing & Calibration Laboratories (NABL).
History of the Company
With a net profit of more than Rs.500 crore, Marico is one of the biggest and oldest consumer goods companies in India, which also has an important presence in South Africa, Southeast Asia, Bangladesh, Egypt, and the Middle East.
The company started with the name Bombay Oil Industries and was also the time when Harsh Mariwala, a graduate joins the family business in the year 1971. He envisions FMCG (Fast-Moving Consumer Goods) market for coconut and other edible oils. With this, he set up a domestic distribution channel for Parachute in 1980 and soon, his innovation popularized.
In 1990, Marico Limited was born and its leadership co-creates its first-ever corporate mission. In the same year, the company launches a non-sticky hair oil called Hair&Care and then, it shifts its headquarters to Bandra in 1992.
The business and market grew and later in 2006, Nihar also enters the Marico’s fold. From 2006 to 2007, the company makes its presence in Africa by acquiring Egypt’s Hair Code and South Africa’s Black Chic & Hercules.
In 2009, the company offers its equity shares in Bangladesh, making it one of the first overseas subsidiaries. In 2011, Parachute Advansed enters the category of skincare and launches its all-new Body Lotion. With this, it also strengthens its market presence in Southeast Asia through food and male grooming portfolio.
In 2013, Kaya demerges from Marico and establishes itself as an individual entity. In 2014, the company achieves the biggest turnover of over Rs.5,000 crore and in 2015, its market cap ranks first with Rs.25,000 crore.
Harsh C. Mariwala – The Chairman of Marico Limited
Harsh Mariwala leads the Marico business, as a chairman and under his leadership, he has transformed the way this business once functioned in the categories of health and beauty. The company now markets some of the leading brands like Mediker, Revive, Saffola, Parachute Advansed, Livon, Set Wet, etc.
Over the years, the company has managed its sales and customer base. Under Mariwala’s guidance, Marico has also achieved various awards and recognition. In fact, the company has also been titled as one of the “Most Innovative Companies in India.”
Saugata Gupta – The CEO and Managing Director of Marico
Saugata Gupta joined Marico in 2004 as the head of the marketing department but in 2007, his contributions and hard work towards the company made him become the company’s CEO. Before Marico, Gupta started his career in Cadbury for 9 years serving in different roles for both India and UK.
After that, he serves as the chief of marketing and sales division at ICICI Prudential. He graduated from IIT with an engineering degree and has 20 years of experience in the FMCG sector.
Marico Limited Listings And Indices
The Marico’s equity shares are listed in both:
- NSE (National Stock Exchange of India) with the code MARICOEQ
- BSE (Bombay Stock Exchange) with the code 531642
The company is a part of some of the well-known indices like Nifty FMCG, Nifty 200, S&P, SENSEX, etc. It is also listed in the following:
- Cochin Stock Exchange Limited
- MCX Stock Exchange
- Over The Counter Exchange Of India Limited
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