Dabur Sees Q4 Revenue Softness as Demand Challenges Weigh on FMCG Business
Dabur India expects a muted finish to its FY24, forecasting flattish consolidated revenue growth for the January–March quarter, the company disclosed in a trading update. The homegrown consumer goods major attributed the performance to subdued consumer demand, especially in rural markets, and elevated base effects of the previous year.
The company highlighted that its India FMCG business is projected to decline marginally in Q4, even as both volume and value growth remain under pressure. Rural demand, which has been sluggish for several quarters, continues to trail urban demand, impacting sales in core categories despite signs of marginal improvement.
The healthcare segment has faced significant headwinds, with double-digit declines during the quarter. The drop is primarily attributed to a high base from mid-single-digit growth in Q4FY23 and a strong 43% year-on-year surge in Q4FY22. Dabur’s healthcare portfolio, which includes products in the Chyawanprash and health supplements category, has been especially sensitive to shifting consumer needs and seasonal fluctuations.
Meanwhile, the food and beverage segment delivered strong mid-teen growth, driven by the summer season’s early onset. The company reported encouraging momentum in its juices and drinks portfolio and anticipates further acceleration as temperatures rise in the remaining part of the season.
International business continues to be a bright spot, expected to grow in the mid-teens in constant currency terms. With strong performance from markets like MENA and Egypt, Dabur’s global footprint remains a key contributor to overall resilience, mitigating domestic sluggishness to some extent.
Dabur emphasized that its gross margins have expanded during the quarter, supported by softening commodity input costs and internal cost management initiatives. This improvement, coupled with moderate ad spends, is expected to boost operating margins ahead of last year’s levels, despite flat topline growth.
With FMCG demand showing tentative signs of rural recovery but still lacking broad-based momentum, Dabur’s Q4 trajectory reflects broader market challenges. As players across the sector navigate inflation recovery, changing consumption patterns, and seasonality effects, companies with diversified portfolios and international exposure may be better positioned to sustain profitability in a low-demand environment.