Jyothy Labs -
Q1 FY 26 results and Concall highlights -
Revenues - 751 vs 741 cr, up 1.5 pc ( volume growth @ 3.5 pc )
Gross margins @ 48 vs 51 pc
Adv and Promotion spends @ 59 vs 62 cr YoY
EBITDA - 124 vs 133 cr, down 7 pc ( margins @ 16.5 vs 18 pc - due compression in gross margins )
PAT - 97 vs 102 cr, down 5 pc
Urban demand remained under stress ( has been like that for last 4 - 5 Qtrs ). Rural demand was descent
Urban demand is showing green shoots of recovery wef mid July. It remains to be seen weather it ll sustain or not remains to be seen
Fabric care ( main wash + post wash ) clocked mid single digit volume growth. Liquid detergents ( led by liquid variants of Henko, More Light, Mr White ) grew in double digits. However, the competitive intensity in this segment is heating up
Dishwash category witnessed increased competition ( wrt competition offering higher gramage ). Hence the category witnessed flattish value growth despite healthy volume growth
Jovia ( company’s new soap launch ) - seeing good traction
HI category remains a work in progress ( witnessed a value de-growth of 9 pc ) . Company intends to turnaround this category in a capital efficient manner. Currently focussing on LVs and newly launched Aerosols, Rackets. At present, HI business is loss making for the company
GM fall in Q1 is due to higher RM inflation and heightened mkt competition
Easing inflation, GST Cuts, RBI rate cuts, Income Tax cuts - should accelerate demand trends going forward. Looking forward to a much better H2 FY 26
General trade continues to remain under pressure ( due Quick Comm + E Comm + Modern Trade )
Excluding the HI segment, company’s volume growth has been @ 5 pc { which ( imo ) is quite descent in a sluggish demand scenario }
Ujala Young and Fresh ( fabric conditioner ) is another brand that’s seeing encouraging initial response ( fingers crossed )
Evaluating assets for inorganic acquisitions to best utilise the cash on books
Should be able to maintain EBITDA margins between 16-17 pc for FY 26 as well
Company has a strong new product launch pipeline - however they did not disclose the same on the Concall
Planning to take gradual price hikes - so the gap between value and volume growth should narrow down going forward, specially wef H2
Disc: holding, biased, waiting for the business to show better performance, not SEBI registered, not a buy / sell recommendation