Ramdev-owned Patanjali Foods reported profit in the second quarter (Q2) ended September 30 that was more than double due to cut in expenses compared to decline in revenue, reports news agency Reuters. Ruchi Gold Oil maker’s profit rose to Rs 255 crore ($30.63 million) in the second quarter from Rs 112 crore a year ago.
Patanjali’s total expenses fell by more than 10 per cent to Rs 7,511 crore due to a 23 per cent decline in raw material costs. Meanwhile, decline in expenses helped offset 8 per cent decline in Patanjali’s operating revenue to Rs 7,822 crore.
Revenue from edible oils, which accounted for 69 percent of its income in the quarter, fell by more than 13 percent. India’s record edible oil imports and weak global oil prices have put pressure on edible oil companies. Last week, fortune-maker Adani Wilmar reported a loss for the quarter.
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Patanjali’s revenue rose nearly 5.5 per cent in the company’s food business, which makes Patanjali-branded biscuits and the “Nutrela” range of products from wheat flour to honey.
Patanjali Foods CEO Sanjeev Asthana said in a statement that he is optimistic that the festive season and increase in consumer spending will boost growth in the next quarter.
“The edible oils segment faced pricing pressure during the second quarter, primarily due to excessive imports, which led to increased inventory levels, impacting both revenues and margins in the second quarter,” the company said in a release. “The observed price trend remains consistent with the first quarter.” Displaying different price fluctuations between the physical and futures markets. “The softening effect of edible oil prices continues.”
Consumer companies are grappling with weak rural demand in the first two months of the July-September quarter due to peak inflation and delayed monsoon. However, softening food prices and increased rainfall in September helped them make a comeback, according to a report by NielsenIQ.
Shares of Patanjali Foods were trading 1.72 per cent lower at Rs 1,430 on BSE at 1 pm on Thursday.