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    Bajaj Consumer Care Limited

    BAJAJCON
    Fast Moving Consumer Goods·13 Jul 2026
    Management Summary

    Bajaj Consumer Care Limited reported a strong Q1 FY27, with revenue growing 28% to ₹341 crores and EBITDA doubling to ₹84.4 crores. Despite sequential gross margin compression due to raw material volatility, the company achieved significant cost savings and strong growth across its core ADHO and non-ADHO portfolios, including a rebound in international markets. Management expects continued gross margin pressure in Q2 but remains focused on consistent double-digit to low-teens growth and execution.

    Highlights

    6

    • Revenue grew by over 28% to ₹341 crores despite a dynamic environment.

    • EBITDA doubled to ₹84.4 crores, resulting in a strong margin of 24.7%.

    • PAT stood at ₹70.7 crores, achieving a margin of 20.7%.

    • Achieved 600 basis points in total savings on other costs compared to Q1 FY26.

    • Almond Drop Hair Oil (ADHO) delivered low teen volume growth, driven by smaller unit price points.

    • International business showed a very strong rebound after a challenging previous year.

    Concerns

    3

    • Gross margins dropped sequentially from 63% in Q4 to 61.8% in Q1 due to unprecedented raw material price volatility.

    • Management anticipates gross margins to be under further stress in Q2 FY27.

    • The institutional business, representing less than 1% of mix, was weak.

    Key financials

    Single quarter

    06 metrics
    1. 01Revenue₹341 Cr+28.0%YoY
    2. 02EBITDA₹84.4 Cr+100%YoY
    3. 03EBITDA Margin24.7%
    4. 04PAT₹70.7 Cr
    5. 05PAT Margin20.7%

    Segment breakdown

    Almond Drop Hair Oil (ADHO)
    80% Revenue Contribution— Volume Growth
    Non-ADHO Portfolio (Growth Portfolio)
    15% Revenue Contribution— Sequential Growth
    Banjara's (part of Non-ADHO)
    5% Revenue Contribution
    List

    Guidance & targets

    7
    CategoryTargetPriority
    Profitability
    Gross Margin
    under stress
    		High
    Profitability
    EBITDA Margin
    low to mid 20s
    		High
    Pricing
    Pricing Actions
    no pricing actions planned
    		High
    Ad Spend
    Advertising Spends (% of revenue)
    15% to 16%
    		High
    Growth
    Non-ADHO Portfolio Growth
    high 20s
    		Medium
    Growth
    Overall Performance
    consistent double-digit to low teens
    		High
    Distribution
    Aarohan Initiative Delta
    200 to 300 basis points
    		High

    Gross Margin trajectory

    Q2, Q3, Q4 FY27
    Current61.8% (Q1 FY27)
    TargetSequential easing after Q2 stress

    Why it matters

    Gross margin compression was a key concern this quarter, and its recovery is crucial for profitability.

    I think margins at a gross margin level will continue to remain, in a tough zone in quarter two and then they will expect to sequentially ease over quarter three and four.

    How to verify

    key_financials.metrics[label='Gross Margin']

    Risks & concerns

    4
    RiskSeverity

    Raw material price volatility

    Unprecedented volatility in raw material prices due to the West Asia war and its cascading impact led to sequential gross margin drop. — Management acknowledged

    high

    Gross margin stress in Q2 FY27

    Gross margins are expected to be under more stress in Q2 compared to Q1, depending on inventory and cooling off of prices. — Management acknowledged

    medium

    Execution risk for market share gain and distribution

    The ability to consistently gain share, acquire more consumers, and distribute products to more outlets is identified as the single largest risk. — Management acknowledged

    high

    Sustaining high growth rates

    Current exponential growth is partly due to a weak base and price corrections; growth is expected to settle to a lower, albeit still strong, double-digit to low-teens rate. — Management acknowledged

    medium

    Q&A highlights

    7

    “I think margins at a gross margin level will continue to remain, in a tough zone in quarter two and then they will expect to sequentially ease over quarter three and four. In terms of the overall EBITDA, we are on the higher side of what our aspiration of and I think a lot will depend on how the revenues go. As you know, we don't give guidances, but we are from a pricing perspective, pricing is not going to drive any further margin expansion. We don't have any pricing actions planned in. Operating leverage, we will continue to try and run the company as efficiently as we can and I think a lot will depend on how the top line performs flowing into the bottom line. So that's the way I'll say. And as far as your one-off question on one-off is concerned, no, we don't have any, significant one-offs.”

    Analyst sought clarity on Q1 margins and future trajectory, especially regarding potential one-offs and the sustainability of the 24.5% EBITDA margin.

    asked by Percy Panthaki

    2 min read6 chapters

    Detailed Narrative

    01

    Q1 FY27 Performance Overview

    Bajaj Consumer Care Limited delivered a robust performance in Q1 FY27, reporting a revenue of ₹341 crores, marking a significant growth of over 28% year-on-year. This strong top-line growth translated into a doubling of EBITDA to ₹84.4 crores, achieving an EBITDA margin of 24.7%. The company also posted a PAT of ₹70.7 crores, with a margin of 20.7%, indicating strong profitability despite a challenging environment.

    02

    Margin Dynamics and Cost Optimization

    While the company's gross margins saw a sequential drop from 63% in Q4 FY26 to 61.8% in Q1 FY27, primarily due to unprecedented🌐 raw material price volatility, it still represented a 510 basis point improvement year-on-year. Management implemented selective price increases and material cost reductions to protect margins. Furthermore, the company achieved over 600 basis points in total savings on other costs compared to Q1 FY26, leveraging operating efficiency to deliver strong savings.

    03

    Brand and Portfolio Performance

    The flagship Almond Drop Hair Oil (ADHO) continued its strong performance, achieving low teen volume growth, primarily driven by smaller unit price points and sachet business. The non-ADHO 'growth portfolio' also performed well, showing high single-digit sequential growth despite value deflation in the coconut segment. International business experienced a strong rebound, with key markets like Nepal, Bangladesh, and MENA showing double-digit growth and margin improvement.

    04

    Distribution Expansion and Aarohan Initiative

    The company saw continued momentum in its general trade channel, with both general and organized trade channels delivering strong growth in the 20s. This broad-based growth was observed across urban retail, wholesale, and rural segments. The 'Aarohan' initiative, a continuous exercise in distribution expansion, is expected to provide a one-time📎 delta of 200-300 basis points and deliver multi-year benefits by increasing direct outlet reach and enhancing portfolio execution capabilities.

    05

    Input Cost Volatility and Outlook

    Raw material prices, particularly for petroleum-related products like LLP and packaging, as well as edible oils like mustard and almond, experienced extreme volatility due to the West Asia war. Management expects gross margins to remain under stress in Q2 FY27 but anticipates a sequential easing in Q3 and Q4. The company is taking month-on-month calls on copra prices due to their unpredictable nature.

    06

    Long-Term Aspirations and Risks

    Bajaj Consumer Care's long-term aspiration is to deliver consistent double-digit to low-teens performance, driven by market share gains and effective execution of strategies. The company aims to maintain advertising spends around 15-16% of revenue. The single biggest risk identified by management is execution risk, encompassing the ability to consistently gain market share, acquire more consumers, and expand distribution.

    This is an AI-generated summary of a publicly available earnings call transcript. It is for informational purposes only and does not constitute investment advice, a recommendation, or an endorsement. inve.money is not a SEBI-registered investment advisor. Please consult a qualified financial advisor before making any investment decisions.