Godrej Consumer Shares Fell ~3%: After Release of Q3 FY 2025 Financial Results

On January 27, 2025, Godrej Consumer Products shares slipped 3% to the day low of ₹1,096.30 at 09:20 AM after opening at ₹1,107.75 Limited (GCPL). The fall in Godrej Consumer shares follows the release of its financial results for the quarter ending December 31, 2024. The company delivered a mixed performance, with growth in several markets but facing challenges in others.

Godrej Consumer Q3 FY 2025 Financial Performance

GCPL reported a 6% year-on-year growth in consolidated organic sales for Q3 FY 2025. A breakdown of segment-wise performance is as follows:

• The standalone business saw a 4% increase in sales, with volumes remaining flat year-on-year.
• Indonesia posted solid growth, with volumes up by 6% and sales increasing by 9% in INR terms compared to the previous year.
• In Africa, the USA, and the Middle East, organic sales declined by 8% in INR terms, though they grew by 1% in constant currency terms.
• Latin America and Other markets saw a significant surge in sales, increasing by 165% in INR terms and 28% in constant currency terms.

The company’s consolidated EBITDA margin for the quarter stood at 20.2%. However, consolidated net profit declined by 14% year-on-year (excluding exceptional items and one-offs), primarily due to temporary headwinds affecting performance.

Godrej Consumer Category Performance

• Home Care: Home Care sales grew by 4%, although Household Insecticides were impacted by a relatively poor season. In contrast, Goodknight Agarbatti showed strong performance, capturing a substantial market share in the Incense Sticks category and is expected to become a market leader. Premium formats experienced some setbacks due to the urban consumption slowdown, but share gains in premium segments indicate that the RNF molecule is resonating with consumers.
• Personal Care: Personal Care grew by 2%, with Personal Wash volumes declining by mid-to-high single digits. However, price hikes helped offset volume losses. The company continues to face inflationary pressures, particularly in palm derivatives, which have resulted in higher pricing across its portfolio. These pressures are expected to continue in the near term. Notably, Magic Handwash saw strong double-digit volume growth.

Godrej Consumer Business Update

In Indonesia, GCPL reported an 8% growth in constant currency sales and a 9% increase in INR terms. Volumes grew by 6%, and the company improved its EBITDA margins, which expanded by approximately 60 basis points year-on-year, reaching 21.5%. Household Insecticides also saw strong volume growth, delivering teen volume growth on a two-year CAGR basis.

In the Africa, USA, and Middle East regions, GCPL reported a 1% growth in organic sales in constant currency terms, though sales in INR terms declined by 8%. The company achieved an EBITDA margin of 14.8%, a notable improvement of approximately 340 basis points year-on-year, driven by gross margin expansion, better product mix, and a reduction in controllable costs.

Godrej Consumer Interim Dividend

The Board of Directors of Godrej Consumer declared an interim dividend of ₹5 per share and fixed February 3, 2025, as the record date and will pay the interim dividend of February 23, 2025.

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