EMAMILTD - Emami Ltd Share Price

In the earnings call for Q4 and FY '25, Emami Limited's management expressed optimism for the upcoming financial year, citing strong growth potential driven by several strategic initiatives. Key points from the management's outlook include:

1. Strong Domestic Business Growth: The company's core domestic business achieved a robust 11% growth in Q4, with a 7% volume increase across various brands. Notable performances included BoroPlus with a 27% increase and Navratna with a 16% rise.

2. International Recovery: The international business grew by 6% in Q4, rebounding from prior declines. This growth was attributed to strong performances in regions like SAARC, Southeast Asia, and CIS, despite challenges in Bangladesh and parts of Africa.

3. Consolidated Financial Performance: Q4 consolidated revenue reached Rs. 963 crores (+8%). For FY '25, consolidated revenue was Rs. 3,809 crores (+6.5%), with EBITDA growth of 8% to Rs. 1,025 crores.

4. Dividend Announcement: The Board approved a special interim dividend of 200%, bringing the total dividend payout for FY '25 to Rs. 10 per share.

5. Expectations for FY '26: The management anticipates sustained market share growth and household penetration, with expectations of a gradual consumption recovery bolstered by easing inflation and government spending. They forecast continued momentum in male grooming segments, particularly with planned enhancements for brands like Kesh King and The Man Company, aiming for high double-digit growth.

6. Innovation and Product Development: Emami has launched over 25 new products in FY '25, focusing on D2C strategies through their Zanducare portal. They project that products launched in the past two years will account for around 50% of Zanducare's total sales.

Overall, the management's outlook is characterized by a positive trajectory in growth across domestic and international sectors, supported by a strong product pipeline and strategic initiatives aimed at addressing previous challenges in specific brands.

Here are the major questions and their respective answers from the earnings transcript of Emami Limited's Q4 FY '25 earnings conference call:

Question 1: "What will be Zairus Master's key KRA for the next two to three years at The Man Company?"

Answer: "We are excited to have Zairus on board. His main targets are to achieve substantial growth for The Man Company and reach profitability for our brands in the long term. While I don't expect immediate profits, turning the business around is a priority."

Question 2: "How do you foresee the summer product performance given the rain and tough comparables?"

Answer: "You've raised a valid point. Q1 is indeed challenging due to an unfavorable base and weather conditions affecting our summer portfolio. We hope to see some rebound in the coming weeks, but it will be tough to match last year's performance."

Question 3: "Did BoroPlus experience any peculiar growth in Q4?"

Answer: "BoroPlus performs well in unfavorable summer weather. Given the lower temperatures and tougher conditions, it outperformed our summer products. It's largely seasonal growth and we expect it to continue in the first quarter too."

Question 4: "What is your revenue expectation for TMC and Brillare for FY '26?"

Answer: "For FY '26, we anticipate high double-digit growth for both The Man Company and Brillare. We're making substantial investments to enhance their brand franchise and are already seeing early signs of growth."

Question 5: "What is your outlook on the pain management category which has shown slow growth?"

Answer: "Pain management is crucial, contributing about 20% to our revenue. While Zandu balm shows stress, we've got new products lined up to boost growth, including two new launches in FY '26. We believe innovations will revive this segment."

Question 6: "What pricing growth should we expect in FY '26?"

Answer: "We expect pricing growth of around 2% to 3% in FY '26, consistent with recent trends."

Question 7: "What was the consumer response to the Smart and Handsome rebranding?"

Answer: "The rebranding has led to some positive momentum after a prolonged decline. We anticipate continued growth. The focus is on expanding into male grooming products and creating a robust marketing strategy."

Question 8: "What are the contributions from new products launched in FY '25 and the target for FY '26?"

Answer: "New products contributed around 4% of our revenue in FY '25. For FY '26, we target a similar contribution around 3%, depending on market reception of new launches."