InvestorQ : How were the quarterly numbers of Godrej Consumer Products in the Sep-20 quarter?
rhea Babu made post

How were the quarterly numbers of Godrej Consumer Products in the Sep-20 quarter?

Riya Dwivedi answered.
9 months ago

In a tough market, Godrej Consumer Products or GCPL reported 10.8% increase in the Sep-20 quarter sales performance at Rs.2915 crore. FMCG business was not overly impacted as it was classified as an essential product during the lockdown and allowed to continue operations in majority of the cases.

Operating profits of GCPL were up 18.7% at Rs.622 crore on the strength of higher sales revenues resulting in better fixed cost absorption as well as support from better movement of inventories. As a result, the OPM of the company increased by 340 basis points to 21.33%.

Net profits for the quarter were up by just about 10.66% at Rs.458 crore. The relatively higher taxes paid in the current quarter reduced the growth in net profits. As a result the net margins fell marginally by to 15.71%. Overall, GCPL managed to make the best of the tough market conditions.

If you look at the geographical break-up of the sales growth, Godrej Consumer saw positive sales growth across various geographical clusters. India grew at 11%, Middle East at 10%, and there was 46% growth in Latin America and SAARC markets. The key market of Indonesia for GCPL also grew by 35%.

The big story was hygiene products and that is where GCPL scored. Most of the hygiene products including soaps grew at 28% while the value for money products grew at 22% in the quarter. Godrej is also lightening on its debt burden with the debt equity of Godrej down by half at 0.17. This has boosted its ROE by 300 bps at 21.2%. That is a booster.