Full demand recovery to take couple of more quarters

How do you think the competition in the FMCG segment playing out given both Reliance and Tatas are upping their games in the segment?

Competition has always been a part of the landscape and it’s nothing new for us. It is, in fact, beneficial for both Dabur and for the category on the whole. To cite an example, we operate in Ayurvedic healthcare space, which is a highly under-penetrated category in India. The entry of new players would only help grow the size of the pie and get more non-users into the category. So, it’s going to be beneficial for the industry. And as the largest player in the category with a nearly 140-year heritage, we would surely benefit from it.

Do you see private sector capex increasing in the next financial year? What is your capex plan for next financial year?

Yes, I am confident private sector investment would surely increase in the coming months and years. At Dabur, our capex stood at Rs 478 crore in the first nine months of FY24. For the full year 2023-24, our expected capex would be about Rs 500 crore. This includes investments in our domestic plants in Indore and Tezpur, besides investments in Nepal and other overseas businesses.

Last month, Dabur also announced plans to invest Rs 135 crore in setting up a new manufacturing facility in South India to meet the growing demand for our products in the region. Our business has substantially scaled up in South India and today accounts for about 18-20% of our domestic business. With South India’s contribution increasing, we have decided to establish a new manufacturing facility there to better cater to the local demand. This is not only an opportunity to bring more jobs to the region, but also allows us to further expand our manufacturing capabilities and meet the growing need for Dabur products in South India.

Almost a quarter of your revenue comes from international market. Do you have a medium term target in mind in terms of revenue contribution from international markets?

Our International Business reported an 11.7% growth in constant currency terms during the third quarter despite the geopolitical headwinds. While we do not give any guidance, as a policy, we expect to report high double-digit growth in constant currency in the international business this financial year.