Marico Limited

Marico reported a strong and resilient performance in Q3 FY26, with both India and international businesses progressing well in a stable operating environment. Demand conditions remained stable, supported by moderating inflation, improved affordability, and healthy crop sowing. The company expects these factors to provide a constructive backdrop for demand improvement across both urban and rural markets in the coming quarters^⏳. Management anticipates progressive improvement in operating profit growth rates as input costs ease and margin pressures subside.

The India business demonstrated sequential improvement in volume growth despite an elevated pricing environment, with strong revenue momentum aided by calibrated pricing actions. Over 95% of the business gained or sustained market share, and about 80% gained or sustained penetration on a MAT basis. Value-added hair oils (VAHO) delivered a strong quarter with accelerated market share gains, reaching an all-time high value share of nearly 30% on a MAT basis, and a 14% two-year CAGR (ex-Shanti). Parachute's underlying volume growth remained positive after adjusting for ml-age reduction, and the brand is preparing to pass on benefits from the 25-30% correction in copra prices.

The Foods portfolio performed broadly in line with expectations, taking a deliberate 'pause on growth' to rectify profitability. Saffola Oats continued to gain market share and consolidate market leadership. Management is confident of resuming an accelerated growth trajectory in the organic food business over the next two quarters, aiming for 20-25% overall foods growth (organic plus inorganic). Saffola Edible Oil had a soft quarter with moderating revenue growth, as volumes were sacrificed below threshold margins, but the brand plans to sharpen its premiumization agenda.

Marico announced a strategic investment in 4700BC, a premium gourmet snacking brand with an ARR of INR 140 crores, with potential to scale to 3x in the next three years. The Premium Personal Care portfolio (Serums, Male Grooming, Skincare) grew in double digits and is expected to exit FY26 at an ARR of INR 350+ crores. The Digital-First portfolio is projected to exit FY26 with an ARR of INR 1,000+ crores, targeting 2.5x of FY24 ARR next year and double-digit EBITDA margins by end of FY27.

The international business continued its robust and broad-based growth, exhibiting a 'virtuous growth flywheel'. Bangladesh led the performance, supported by a steady core business and new franchises. Vietnam and South Africa bounced back to deliver double-digit constant currency growth, driven by targeted initiatives. MENA also delivered strong performance across key franchises, and the NCD business showed accelerated growth. Management expects this momentum to sustain across markets over the medium term^⏳.

Marico had previously taken a 60% price hike for Parachute when copra prices shot up over 100%. With copra prices now corrected by 25-30% from peak, the company plans to take a single, firm price correction after gaining clarity on the copra trajectory by March-April, rather than multiple steps, to avoid trade disruption. Management expects progressive improvement in operating profit growth rates over the coming quarters, striving for 150-200 basis points operating margin expansion in the next year due to easing input costs and subsiding margin pressure.