Colgate-Palmolive (India) Ltd shares jumped nearly 5% in intraday trade on Thursday, i.e. 18 July, after the company’s first quarter (Q1) earnings met analyst expectations.
At 2:24 pm, shares of Colgate India were trading at Rs 1,208.50 apiece, up 3.5%, on BSE after hitting an intra-day high of Rs 1,221.70.
Colgate-Palmolive India’s profit in the June quarter fell 10.7% year-on-year to Rs 169.1 crore. However, the year-ago profit of Rs 189.5 crore had included an exceptional gain of Rs 34.1 crore. “Excluding the impact of the exceptional item for the previous year, net profit after tax increased by 5% in the current year,” Colgate said.
Revenue during the June quarter grew 4.2% to Rs 1,085 crore driven by a domestic net sales growth of 6% compared with a year ago. Colgate saw toothpaste volume growing at 4%, which met Street expectations.
Earnings before interest, tax, depreciation and amortisation (Ebitda) increased 6.6% year-on-year to Rs 300 crore in the June quarter, while Ebitda margin expanded 60 basis points to 27.6%
Advertising spend during the June quarter also increased to Rs 151.3 crore against Rs 143.5 crore in the year-ago period.
“The quarter saw a moderation in demand affected by lower-than-expected growth in the rural markets. We do consider this trend to be temporary and expect a pickup over the coming quarters,” Issam Bachaalani, managing director at Colgate-Palmolive (India), said.
“Despite the moderation, we continue to remain focused on strengthening the core of our business and investing in advertising and brand building activities,” he added.
In a separate filing, Colgate-Palmolive said its board of directors has appointed Ram Raghavan as managing director of the company with effect from 1 August 2019.