By Procter & Gamble Hygiene and Health Care stock took a hit, falling up to 3.76% to an intraday low of ₹16,342 per share on August 29, 2024. This decline came in response to the company’s weak financial performance for the fiscal quarter ending June 30, 2024.
The company reported a sharp 43.6% year-on-year (YoY) drop in net profit, which plunged to ₹31.2 crore from ₹55.3 crore in the same quarter last year. This significant decline in profitability overshadowed the 9.3% rise in revenue from operations, which reached ₹931.8 crore compared to ₹852.5 crore a year ago.
The operating performance was particularly concerning, with earnings before interest, tax, depreciation, and amortization (EBITDA) dropping by 44.7% YoY to ₹118.8 crore from ₹214.9 crore in the previous year. The EBITDA margin also suffered, compressing by 1,240 basis points to 12.8%, down from 25.2% in the same quarter last year.
Despite the challenging results, the company attempted to reassure investors with the announcement of a ₹95 per share dividend for the financial year ending June 30, 2024. This move, however, did little to mitigate the impact of the disappointing earnings report on the stock’s performance.
At 11:17 AM, Procter & Gamble Hygiene and Health Care shares were trading 2.83% lower at ₹16,500 apiece, while the BSE Sensex was trading 225.44 points higher, indicating that the broader market was not as negatively impacted as the company’s stock.
The company’s managing director, V Kumar, emphasized that despite the tough operating environment, Procter & Gamble Hygiene and Health Care remains committed to its growth strategy, focusing on product portfolio superiority, innovation, and productivity.
The steep drop in profitability raises concerns about the effectiveness of these strategies in the current market environment.
Procter & Gamble Hygiene and Health Care is a leading player in India’s FMCG sector, with a strong portfolio that includes top brands like Whisper, VICKS, and Old Spice. Despite its market capitalization of ₹53,621.89 crore, the company’s recent financial struggles suggest that it may face ongoing challenges in maintaining its market position and delivering sustainable growth.
As the company navigates these hurdles, investors will be closely watching how Procter & Gamble Hygiene and Health Care adapts its strategy to improve its financial performance in the coming quarters.
