Marico profits rise 8.9 per cent; Sundari stake to divested to Wellness Systems
23 Apr 2009
Personal care products maker Marico Ltd on Wednesday posted an 8.9-per cent rise in consolidated net profit in the March quarter on the back of higher volume sales and pricing, the company said in Mumbai.
It also said it would sell its stake in Sundari LLC to US-based Wellness Systems, for an undisclosed amount, in order to focus on the growth markets of Asia and Africa. Wellness Systems is promoted by two of Marico Group's senior managers who were in charge of the Sundari business.
A majority of Sundari's revenue is generated from business-to-business sales to spas at luxury resorts and hotels globally. Marico had acquired a controlling interest in Sundari LLC in 2003, and has since then made investments to expand the business. However, Sundari contributes only a small share of Marico's revenue.
Net sales grew 20 per cent to Rs5.6 billion. The company posted a net profit of Rs44.4 crore rupees after booking a one-time loss 15.3 crore related to the sale of Sundari.
The company also saw faster growth in rural India on better realisations due to higher farm output and a government waiver on loans to farmers, it said in a statement. In December 2008, Marico launched a low price point flexi 'Parachute' coconut oil pack at Rs4 to tap this market, and in the current fiscal year it would focus on expanding distribution in rural India, it said.
The company has also been expanding its presence in health-promoting processed foods under its 'Saffola' brand. It has rice, sunflower oil and a baked snack called 'Saffola Zest'.
Marico, which is also stepping up its skin care solutions business under the brand name Kaya, added 20 clinics in the last fiscal, taking the total number of clinics in India and the Middle East to 85.
