Dabur’s digital-first brands touch ₹100 crore in sales in FY24

Mumbai: Dabur India's digital-first brands, or brands it has launched online, grossed a turnover of more than ₹100 crore last fiscal year, the company said in its annual report.

In FY24, the company rolled out 14 new products in line with its strategy to expand both its premium portfolio and total addressable market.

“These launches also marked Dabur’s entry into several emerging and growing categories like mosquito repellent liquid vaporizers, cooling hair oils, gel toothpastes, teas, and shower gels. Our digital-first brands have grossed a collective turnover of over ₹100 crore,” the company said in its annual report released Wednesday evening.

To be sure, several large consumer companies have launched digital-first brands addressing niche consumer needs as well as competing with new-age brands that are gaining foothold online. This is especially true in categories such as beauty and personal care as well as packaged foods.

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In FY24, the maker of Real drinks and Vatika shampoo reported revenues of ₹12,404 crore, with a net profit of ₹1,843 crore. It sells products under the home and personal care (HPC) categories, apart from food and beverages and healthcare products. Its brands include Meswak toothpaste, Dabur honey, Amla hair oil, and Real fruit drinks.

Commenting on demand trends in the year gone by, the company said the domestic FMCG sector witnessed a period of subdued growth.

“FY2023-24 opened strong but became challenging as the year progressed. Despite softening inflation and a general improvement in consumer sentiments, the domestic fast-moving consumer goods (FMCG) sector witnessed a period of subdued growth during the year. The household consumption trends reflected a reduction in bulk purchases by consumers to manage expenses, allowing for discretionary spending on smaller categories. Low wage growth in rural India also resulted in downtrading by consumers. Climate change marked by uneven weather patterns such as unseasonal rainfall, delayed and contracted winter also impacted our seasonal portfolio,” Mohit Burman, chairman, Dabur India, said.

Geopolitical situation in the overseas markets was not favourable with the cost-of-living crisis hitting several countries. “Sharp currency devaluations led to a spike in commodity prices, driven largely by the attacks on container ships in the Red Sea. With decisive actions and a strong stakeholder focus, we could face these imminent challenges and continue to deliver value for our stakeholders,” Burman said in the annual report.

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While demand trends were weak during the year, some green shoots are visible indicating a gradual recovery, the company's management added.

“This is validated by improvement in volume growth in key categories as compared to the previous year. Continued focus of the current government on infrastructure development, support to rural incomes and expectation of a normal monsoon bode well for a rural recovery. We are optimistic that rural consumption will improve during the current year, although this may be more visible in the second half of the year,” said Mohit Malhotra, CEO, Dabur India.

During the year, Dabur rolled out a number of new products and variants. These launches marked Dabur’s entry into growing categories like mosquito repellent liquid vaporizers, cooling hair oils, gel toothpastes, value added tea, to name a few. New products accounted for 3.4% of its total sales during the year.

Additionally, the company said it is embarking on phase 4 of its sugar reduction initiative in its drinks portfolio. This will help the company achieve an average 3% reduction in added sugar across two-thirds of its beverage portfolio.

In 2019, Dabur India started a phase-wise “reformulation” journey by reducing sugar levels in its Real range of fruit juices and beverages.

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Overall, its efforts have led to a 20.95% reduction in added sugar from the 2018 baseline, equating to approximately 1,300 metric tones of reduced sugar consumption annually. In addition, as part of the company's commitment to promote healthier choices, it reduced serving sizes from 200ml to 180ml and from 160ml to 140ml and launched the Real Mini range (110 ml aseptic packs), keeping in mind affordability of the product while encouraging optimal consumption, the company added.