Marico in crisis as Bangladesh business may get hit, shares fall over 4%
Shares of Marico fell more than 4 per cent today (August 6) amid political turmoil in Bangladesh.
The company- which owns Saffola and Parachute packaged oil brands- earns around 11-12% of its revenue from Bangladesh.
Nuvama’s Abneesh Roy said on Marico, “We remain concerned about Bangladesh in Q2FY25. Other FMCG companies have highlighted a significant adverse impact in Q2 sales in Bangladesh due to massive protests. Marico has the highest exposure 11–12% of consolidated business); for others, exposure is small.”
In June quarter results, the company said the share of Bangladesh in its overall international business has been declining. In FY22, the company had 51% business in Bangladesh which fell to 44% in FY24 and is seen as falling to 40% in FY27.
Marico said in a regulatory filing, “While Bangladesh and Vietnam have led from the front, the strong growth momentum in the MENA and South Africa businesses has visibly strengthened the broad-brd construct and offers margin upside over the medium term. This has resulted in visible geographical diversification in the overall international business, reflecting in the reducing dependence on the Bangladesh business.”
Meanwhile, Domestic brokerage Prabhudas Lilladher downgraded Marico to hold citing Bangladesh turmoil as one of the reasons.