Godrej Consumer (GCPL) has reported a surprise consolidated net loss of Rs 1,893 crore for the quarter ended March 31, 2024 (Q4FY24), compared to a net profit of Rs 452.14 crore in the same period last year. This unexpected loss was attributed to exceptional items totaling Rs 2,376 crore reported during the quarter. Analysts had anticipated a net profit of Rs 507 crore for the period.
The exceptional items included a loss of Rs 792.6 crore on the sale of investment in Godrej East Africa Holdings and an impairment provision of Rs 273.9 crore for a diminution in the value of investment in Godrej Mauritius Africa Holdings. These losses were incurred due to changes in the business model and long-term strategy for Africa, according to the company’s statement.
Despite the unexpected loss, revenue from operations for the March quarter stood at Rs 3,365.11 crore, marking a 6% increase from Rs 3,172.21 crore reported a year ago. This revenue figure slightly exceeded the Rs 3,361-crore consensus forecast by analysts tracked by Bloomberg for the period.
Underlying volume growth at a consolidated level was reported at 12% in Q4, with the India business achieving a robust volume growth of 15% during the quarter. Sudhir Sitapati, MD & CEO of GCPL, emphasized the company’s focus on driving volume-led growth through strategic investments in its brands. “We are committed to launching new products aligned with our purpose to bring the goodness of health and beauty to consumers,” Sitapati stated.
Despite the unexpected setback, the board of GCPL has recommended an interim dividend of Rs. 10 per share for the financial year 2023-24. The unexpected loss in Q4 underscores the challenges faced by GCPL in navigating changes in its business model and long-term strategy, particularly in the African market. However, the company remains optimistic about its growth prospects and is committed to driving volume-led growth through innovative product offerings and strategic investments in its brands.