Dabur India Ltd's Q2 Profitability Impacted by Adverse Weather Conditions and Distributor Inventory Correction

Dabur India Ltd reported that its profitability for Q2 will be affected due to low primary sales amid heavy rains and floods, which impacted consumer offtake and out-of-home consumption. The company is correcting distributor inventory levels in the general trade channel to improve ROI, expecting mid-single-digit revenue decline and an impacted operating margin.

Homegrown FMCG giant Dabur India Ltd has announced that its profitability in the second quarter will take a hit due to decreased primary sales, driven by adverse weather conditions including heavy rain and floods that hampered consumer offtake and out-of-home consumption.

In a quarterly update to stock exchanges, the company disclosed anticipated mid-single-digit decline in consolidated revenue for Q2 owing to a strategic correction in distributor inventory within the general trade channel.

Dabur emphasized that this corrective action, while temporarily reducing revenues, is vital for the long-term health of its business. The international business continues to show double-digit constant currency growth. Despite these challenges, Dabur is committed to ongoing investments in branding and marketing efforts.

(With inputs from agencies.)