Emami’s ad spends up 34% in Q2 of FY23

Emami has disclosed a revenue of Rs 813.75 crore in the second quarter of FY23, marking a 3.38% rise compared to the corresponding quarter in the previous fiscal year. The company’s advertising expenses for Q2 FY23 amounted to Rs 141.48 crore, reflecting a substantial increase of 34.33% from the Rs 105.32 crore reported in the same quarter of the previous year.

The international business segment exhibited robust growth, recording a 17% increase quarter-on-quarter, driven by strong performances in most markets, particularly in MENA and CIS.

Profit After Tax (PAT) at Rs. 180 crore experienced a 3% decline but demonstrated a 23% growth on a 3-year Compound Annual Growth Rate (CAGR) basis. Despite this, Emami maintains one of the industry’s highest gross margins at 66.6%, a Profit Before Tax (PBT) margin at 23%, and a PAT margin at 22%, surpassing its peers.

Harsha V Agarwal, Vice Chairman and Managing Director of Emami Limited, expressed satisfaction with the first half’s net sales growth of 10%, emphasizing the company’s focus on cost control, distribution expansion, aggressive marketing campaigns, and penetration drive. Agarwal anticipates delivering double-digit growth with healthy margins in the second half and aspires to achieve double-digit growth with higher Earnings Before Interest, Depreciation, Tax, and Amortization (EBIDTA) than the previous year for the core business on a full-year basis.

Mohan Goenka, Vice Chairman and Whole-Time Director of Emami Limited, acknowledged muted consumer demand across markets, influenced by high inflation impacting consumption, especially in rural areas. He noted a correction in the COVID-contextual portfolio of pain management and healthcare products. Despite a low single-digit growth on a year-on-year basis for the quarter, the 3-year CAGR demonstrated an impressive high single-digit growth of 8% compared to pre-pandemic levels. The international business segment also maintained a strong performance with a double-digit growth of 17%, navigating various global and geo-political uncertainties.