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Patanjali Foods’s FMCG business will potentially achieve revenue growth of Rs 7,000 crore in the current fiscal year, the company’s CEO Sanjeev Asthana said while speaking about the first quarter performance.
In conversation with CNBC TV18, Asthana expressed his optimism about the company’s growth and said, “The company is confident with the growth (of FMCG business) in the first quarter. Our revenue growth momentum will continue. Biscuits, nutraceutical, foods, and soya protein business is growing well.”
The CEO further said that the company’s FMCG business has witnessed growth in margins across categories. “We expect to maintain 18 percent plus margin in the overall FMCG business and in longer term it should improve. The pace of growth in both revenues as well as margins should continue,” he added.
Patanjali Foods posted a decline of 64 per cent in their first quarter results for the current fiscal year. The company reported a net profit of Rs 87.75 crore in Q1FY24, a big fall from Rs 241.25 crore for the same period in the previous year, reported Moneycontrol. The report added that a fall in prices of cooking oils contributed to this decline.
Elaboration on margin contractions in the first quarter, Asthana noted that global prices on futures exchange increased about 10 per cent while there was no reaction in the domestic market. The futures exchange is where the company hedges its risk.
Asthana noted that the company has seen a volume growth of about 35 per cent from the last year in terms of overall market share and is growing consistently in market size.
The CEO provided an outlook for the company on the basis of edible oils and said, “Edible oils are quite volatile. We are expecting this year if there’s a spike in prices, there will be revenue expansion as well.” The company estimates a margin of 2-4 per cent from the edible oil segment and is optimistic about the upcoming quarters, the CEO added.
On the palm oil business front, the company noted that multiple memorandum of understanding (MoUs) have been signed with Telangana, Assam. “We have 6.34 lakh hectares of land allocated to the company, set up 11 nurseries and 4 more are in the works,” Asthana added.
