Shares of Dabur India Ltd. fell sharply by over 7% during the morning session after the company released its business update for the quarter ended March 2025. The FMCG major revealed that its consolidated revenue for Q4 FY25 is expected to remain flat, with operating profit margins forecasted to shrink by 150-175 basis points year-on-year. This decline in profitability is attributed to inflationary pressures and operating deleverage, which have weighed on the company’s performance.
Dabur also noted that while rural markets have continued to show resilience, growing at a faster pace than urban markets, FMCG volume trends across the board have remained subdued. Channels such as modern trade, e-commerce, and quick commerce maintained growth momentum, whereas general trade faced ongoing challenges.
By 10:30 am, Dabur’s shares were trading at Rs 462.45, reflecting a 6.7% decline on the NSE. Despite the weaker outlook in India, Dabur is optimistic about its international business, especially in regions like the MENA (Middle East and North Africa), Egypt, and Bangladesh. These markets are expected to post strong performances, leading to robust double-digit growth in constant currency terms for Dabur's international operations.
In India, the company’s Foods division, which includes brands like 'Hommade' and 'Badshah', is performing well and is expected to post double-digit growth. However, due to delayed winters and a slowdown in urban markets, Dabur’s FMCG business in India is likely to experience a decline in mid-single digits.
Dabur’s management remains optimistic, emphasizing their focus on driving profitable growth through strategies like brand building, enhanced go-to-market plans, and improving operational efficiency. The company is also hopeful that the recent incentives in the Union Budget will help stimulate consumption and aid a recovery in the FMCG sector, positioning Dabur to capitalize on the recovery.
Over the past year, Dabur’s stock has fallen by more than 13%, underperforming the Nifty 50 index, which has gained around 3.8% during the same period.
