Product diversification leads to Marico’s sales growth despite pandemic

Marico Bangladesh has navigated the pandemic well and come out strong with a continuous growth in sales over the nine months till December 2020 by diversifying its portfolio.

The Bangladesh unit of India-based multinational company Marico Limited launched Mediker SafeLife hand sanitisers and hand-wash in mid-April last year amid a tumultuous time for businesses due to countrywide shutdown.

About a couple of months before that, the consumer goods company launched its first male grooming brand named 'Studio X' in Bangladesh. The brand introduced a wide range of premium products for men from shampoos, face wash, hair gels to deodorants.

Riding on a diversified portfolio, the company posted 14% growth in revenue to Tk876.96 crore in the first three quarters of the fiscal 2020-21.

Its net profit rose 16% year-on-year to Tk249.96 crore, with earnings per share at Tk79.35 for the period.

The company has declared a 200% cash dividend to the shareholders for the first three quarters of FY2020-21.

On an earnings call in October last year at the company's headquarters in India, Saugata Gupta, chairman of Marico, said, "We achieved huge successes in Bangladesh after diversification of the portfolio."

That same month the company decided to invest Tk227 crore to expand its 'Made-in-Bangladesh' products. It has planned to set up a new plant in the Mirsarai Economic Zone.

The investment is intended to support Marico's long-term growth aspirations, a company official said.

Marico Bangladesh Managing Director Ashish Goupal said, "The right socio-economic indicators are in place to unlock the potential of Bangladesh in a post-Covid-19 world."

The government's vision of creating digital governance and its push for putting the economy on fast track offers an enabling environment for multinational players to invest in and be a part of Bangladesh's growth journey, he said.

Marico's journey in Bangladesh began in 1999 with flagship brand Parachute Coconut Oil. Since then, the company expanded to 29 brands in personal care and food items, such as Saffola edible oil.

To meet the growing demand in coconut oil and food products, the company invested Tk29.3 crore to boost the capacity of its factory in Gazipur, and set up a new manufacturing line at the beginning of 2020.

The company was listed on both stock exchanges in 2009. Its paid-up capital is Tk31.5 crore.

The company is ranked third position on the table of Dhaka Stock Exchange's top share prices.

Its share price jumped by 38% during the ongoing pandemic, as investors showed confidence in the company's business policy.

But on Tuesday, Marico's share price fell 0.13% to Tk2,158.10 per share on the Dhaka bourse.

As of December 2020, sponsors and directors jointly had 90% stake in the company, institutional investors 3.65%, foreign investors 4.57% and general investors 1.78%.