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Modest growth, margin expansion continues

Godrej Consumer Products (GCPL) released its pre-quarterly update for 3QFY24. Here are the key takeaways:

* India business:

* Demand environment remains similar to that witnessed in 2Q.

* Organic business reported mid-single-digit volume growth.

* Reported volume growth (including acquisition) was in double digits.

* Indonesia business:

* The Indonesia business is expected to clock double-digit growth in volume and high-single digit CC sales growth.

* GAUM (Godrej Africa, the US, and the Middle East) business:

* It is expected to register flat growth or a mild decline in volume. Sales growth was in double digits in CC basis.

* In INR terms, sales declined in high-single digits due to Naira adverse currency translation impact.

LATAM business

* LATAM revenue was hit by a sharp devaluation of Argentinian Peso, impacting 9M revenue.

* Despite challenges, the business has maintained volume growth.

* Consolidated:

* Organic business volume is expected to grow in mid-single digits.

* Revenue is expected to decline in low-single digits YoY in INR terms due to GAUM and LATAM currency and hyperinflation.

* Reported volume growth is expected to reach high-single digits, while reported sales growth could remain relatively flat in INR terms.

* EBITDA margin may expand YoY, along with higher category development investments.

* Raymond Acquisition

*The performance of Park Avenue and KamaSutra improved sequentially and they are on track to achieve full-year guidance.

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