Colgate-Palmolive India's net profit declines 7.2% in April-June quarter

Colgate Palmolive India saw its net profit down 7.2 per cent year-on-year to Rs 216.6 crore (excluding impact of exceptional item ) in the April-June quarter and its revenue up 2.5 per cent to Rs 1186.59 crore compared to last year.

The company's PBIDT stood at Rs 327.9 crore in the quarter ended June, down 9 per cent compared to last year.

The toothpaste major witnessed the impact of overall rural slowdown and inflationary pressure during the quarter, however, the company remains cautiously optimistic that the trends will improve in the coming quarters, Mukul Deoras, chairman at Colgate Palmolive India said in the company’s earnings release.

“Our overall pricing strategy and strong funding the growth programs delivered consistent margins while we continue to maintain our strong investment in innovation and brand building activities,” Deoras said.

Phillip Capital said in its report on the company that it has all the ingredients of “Essentials Play” in its favour; however increased competitive intensity and slowing category growth are key challenges that management need to tackle for a meaningful recovery.

The brokerage also said that GSK Consumer’s recent integration with HUL (gives access to GSK's premium brands of toothpaste in chemist channel), will further make the premiumisation journey for Colgate that much more difficult and enhance cross-selling opportunities for HUL.