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Godrej Consumer Products eyes growth in emerging categories
OdishaRay
Bhubaneswar (09/05/2025): Godrej Consumer Products Limited(GCPL) is sharpening its focus on emerging high-growth categories such as pet care, body wash, liquid detergents, deodorants, air fresheners, and sexual wellness, as it positions itself to tap into a revival in consumer demand over the next 12 to 18 months.The company’s renewed optimism is fuelled by easing food inflation, potential income tax cuts, and expected pay commission hikes. “We are bullish about revival in demand over the next 12-18 months for a variety of reasons,” said Sudhir Sitapati, MD and CEO, GCPL.Despite rising palm oil prices, Sitapati termed the inflation as a “short-term blip,” adding that the company has only passed on 15–16% of the cost increase to consumers. Strategic Pivot to High-Growth Categories- To navigate slowing momentum in legacy categories, GCPL is accelerating its presence in future-facing segments.In April 2024, the company launched its pet care brand, ‘Godrej Ninja’, in Tamil Nadu, capitalizing on its marketing and manufacturing capabilities. Other high-performing innovations include Fab Liquid Detergent, priced at Rs 99, which has achieved an annual run rate revenue of Rs 250 crore within just 12 months.In the deodorant space, GCPL is expanding accessibility with the Rs 99 antiperspirant ‘Bloq’ and a more affordable version of KamaSutra deodorant. Following its acquisition of Raymond Consumer Care’s FMCG business in 2023, GCPL also added legacy brands like Park Avenue and KamaSutra, bolstering its presence in personal grooming and sexual wellness categories. Sustained Innovation in Core Segments- The company’s household insecticides category continues to be a growth driver, with Goodknight and Hit delivering double-digit growth in Q4.GCPL is also innovating with a patented molecule (RMF) in its electric and incense-based products, aiming to provide safer, regulated alternatives to harmful, illegal incense sticks. Rs 700 Crore Capex and Global Expansion- To support its category expansion and innovation pipeline, GCPL is investing Rs 700 crore over the next two years to add production lines in its North and South India plants, and to set up a new manufacturing facility in Indonesia—a key international market. Quick Commerce Emerges as a Key Channel- GCPL is also witnessing strong traction from quick commerce platforms, which Sitapati described as a fast-growing and margin-friendly channel, particularly for mid-size packs that offer operational and financial efficiency. Looking Ahead- GCPL has projected mid-to-high single-digit volume growth in FY26 and double-digit EBITDA growth in FY25, driven by continued demand recovery and moderating input costs. Sitapati remains optimistic that GCPL’s focus on the "categories of tomorrow" will help the company weather short-term challenges and position it for long-term success. Business Performance- Commenting on the business performance, Sudhir Sitapati, said: We delivered a sequentially improving performance in Q4 FY 2025, despite market conditions remaining the same.Our Consolidated organic volumes for Q4FY25 grew by 6%, led by the India business growing volumes at 4% and Indonesia growing volumes at 5%.This led to full-year organic volume growth delivery at 4% for our consolidated business, 5% for India and 6% for Indonesia.Our Consolidated organic revenue growth for Q4 and FY 2025 stood at 7% and 4% respectively.Demand conditions in India have continued to be impacted by headwinds in urban consumption.Surge in palm oil prices by more than 50% is negatively impacting our EBITDA margin.Our reported Standalone EBITDA margin at 22.6% is lower than our normative margin.However, buoyed by a good season, we had a blockbuster performance in Household Insecticides which grew volumes in strong double digit.Our categories of Air Fresheners, Laundry Liquids, etc.have continued to deliver strong underlying volume growth.This helped deliver 4% volume growth on top of a 4% pricing growth led largely by soaps.The volume growth on the non-soaps’ portfolio was high single digit with soaps volume growth impacted by volume-price rebalancing.In Indonesia, we continue to consistently deliver healthy performance with 5% volume growth and EBITDA margin expansion.In organic terms, Africa, USA and the Middle East sales grew by a strong 23% in INR terms and delivered 17% EBITDA margin resulting in the fifth consecutive quarter of profit and margin expansion.We are on track in our journey to reduce wasted cost and are deploying this to drive profitable and sustainable volume growth across our portfolio through category development.We remain committed to our purpose of bringing the goodness of health and beauty to consumers in emerging markets.