Dabur sees inflation affect gross margins in Q2

By

Isabelle Crossley

Published
Oct 7, 2022

Dabur reported that high inflation rates affected its gross margins in the second quarter of the 2023 financial year. The personal care and general fast moving consumer goods business did see its revenue grow during the quarter. 

An inflation-led drop in operating margins could result in a drop of between around 150 and 200 basis points for the business, Dabur wrote in a regulatory filing, accessed by the Economic Times. Although its revenue is expected to have grown by mid-single digits, Dabur revealed that it did feel the effects of inflation. 
 
“During the quarter, inflation was at peak levels, which impacted gross margins,” said Dabur in a regulatory filing, ET Bureau reported. However, the business has a more positive outlook for the second half of the financial year thanks to easing commodity prices. 

Dabur retails a wide range of personal care brands including Vatika, Fem, Babool, Odonil, and Dabur among others. With a pan-India presence, the brand is positioned in the value to mid-segment of the market. 
 
August saw retail inflation in India reach 7%, up from 6.71% in July. This year, brands in numerous sectors have raised their prices due to inflation, from footwear to personal care labels. Many brands saw their revenue increase due to hiking prices but, if inflation-led price hikes continue, consumers will have less capital with which to purchase non-essential goods.