Why This FMCG Stock Is Up 6% Despite Reporting A 4% Decline In Q4 Net Profit

Gillette India’s shares climbed on Tuesday, despite the company announcing a nearly 4% drop in its quarterly profit on Monday due to intense domestic competition.

What Happened: The company, famous for its Mach 3 shaving razors, reported a profit of ₹99.09 crore for the January-March quarter, down from ₹103 crore the previous year.

Despite tough competition from smaller manufacturers who can more easily secure shelf space amid falling commodity prices, revenue from Gillette’s core grooming segment — which accounts for as much as 82% of its total revenue — increased by nearly 14% to ₹558 crore.

Additionally, the cost of raw materials consumed decreased by 6.3%.

See also: Tata Stock Slumps 4% After Q4: Brokerage Sees 30% Slide Ahead

The parent company, Procter & Gamble Co, had earlier in April raised its annual core profit forecast, citing price increases and sustained demand.

Despite a 5.3% decline in the Nifty FMCG index, Gillette India’s shares rose by 1.2% in the March quarter.

LV Vaidyanathan, Managing Director, Gillette India Ltd said, “we remain committed to a focused product portfolio of daily use categories where performance drives brand choice, superiority across product performance, packaging, brand communication, retail execution and consumer and customer value productivity, constructive disruption, and an agile and accountable organization.”

Price Action: Gillette India shares were trading 5.87% higher at ₹6573.75 on Tuesday, at midday.

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