Marico reports USD 52M net profit in Q2 FY26 amid commodity inflation
Marico is navigating challenging cost dynamics while leveraging strong revenue growth and strategic investments to maintain its leadership in the competitive FMCG sector.
INDIA – Marico has reported a marginal decline in its Q2 net profit for FY 2025-26, slipping slightly from ₹433 crore (USD 52.2 million) to ₹432 crore (USD 52 million), primarily due to margin pressures.
Despite this, the company’s revenue soared by over 30% year-on-year to ₹3,482 crore (USD 420 million), from ₹2,664 crore (USD 321 million) in the previous year’s quarter.
The decline in net profit is primarily due to margin pressures from high commodity prices and inflation, which adversely affected gross margins.
Marico’s gross margin contracted by 810 basis points (or 8.1 percentage points) year over year, reflecting higher costs for key commodities such as copra and other raw materials.
Despite margin compression, Marico’s revenue from operations grew remarkably, driven by strong domestic demand and international market expansion.
The domestic segment alone contributed ₹2,667 crore (USD 321 million), up nearly 34.76%, while the international market contributed ₹815 crore(USD 98 million), up 19%.
The company’s revenue growth was underpinned by price hikes in categories such as hair oils, where inflation was particularly high, and by volume growth in the India business, with a 7% increase in underlying volume.
Total expenses for the quarter rose sharply by 35.87% to ₹2,981 crore(USD 359 million), primarily due to increased input costs and higher promotional expenditure, which rose 19% year-on-year.
Despite margin pressures, Marico continued to invest significantly in its brand-building and portfolio diversification efforts, with advertising and promotional spending increasing.
Marico’s operating margin declined to 16.1%, a decrease of 350 basis points from the previous year, reflecting the impact of inflation-driven cost pressures on gross margins.
However, the company maintained a resilient performance by focusing on volume growth and market share gains, suggesting a strategic approach to balancing short-term margin compression with long-term growth objectives.
Despite a slight dip in profitability, Marico’s share price rose, reaching a record high of ₹739.35 (USD 8.9), up 2.41% from the previous close.
However, investors are optimistic about the company’s growth trajectory, buoyed by strong revenue performance and strategic investments despite margin headwinds.
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