Bajaj Consumer care hosted a conference call on Nov 2, 2021. In the conference call the company was represented by Mr. Jaideep Nandi – Managing Director, Mr. Dilip Kumar Maloo – Chief Financial Officer and Mr. Kushal Maheshwari – Head Treasury and IR.

Key takeaways of the call

After robust sales in the month of June and July, company witnessed decline in month of August and September.

To tackle raw material inflation, company has taken price increases of about 5% in this quarter. Also taken about 20 cost saving projects.

Topline was negatively impacted because overindexed market of Bihar and UP severely declined.

Hair oil category sharply declined by 8.2% in Q2 for Key markets (where company is over indexed) while rest of the markets grew by 6% (under indexed markets for company).

Company is improving distribution reach in west and south market as it has plans to launch new products in coming months.

E-commerce business continued to scale up well, which now contributes to 4% of total sales.

Strategic SKUs for the e-commerce channel (650ml ADHO, BAHO) have become lead contributors to sales and growth.

Rural markets have had steeper decline due to higher base of last year while Urban remained flat.

Going forward, focus area for the company will remain e- commerce, launching new products for rural markets and scaling up of international business.

On a 2-year basis, Cheaper / Mass hair oil segments have rebounded faster (Coconut plus Amla).

Retail performance has been good with near double-digit growth, backed by focused drives and top retailer loyalty program. However wholesale declined sharply with reduced footfalls in key markets.

Modern trade registered high teen growth with resumption of modern retail outlets across the country.

Company witnessed lower than expected footfalls in the August Big Day events across modern trade chains, however improvements were seen towards end of September and October.

In International business- UAE and Africa had a sharp decline due to travel restrictions. Nepal and Bangladesh came out of lockdown and performed well with double digit growths.

Going forward, company expects EBITDA margin of 24-25%.

Few states in North have done well reaching market shares greater than 5% for Bajaj Amla Aloe Vera Hair Oil.

Company launched Bajaj Pure Coconut Oil in July 2021, which is showing Encouraging Initial response. Company also launched new digital first premium brand (Natyv Soul) in Hair Care and Personal Care space.

Natyv Soul is developed for E-commerce channels targeting women in the 18-35 age groups.