Godrej Consumer Products will take a 10-11 percent price increase for the rest of the year, Sameer Shah, chief financial officer, told CNBC-TV18 on Friday.
His remarks come a day after the Mumbai-based consumer goods company reported lower-than-expected earnings for the quarter ended September 30, 2021. It posted a consolidated net profit of Rs 479 crore for the July-September period, up 4.6 percent on a year-on-year.
“The quantum of the price increase that we took in Q2 is around 5 percent and for the rest of the year, the price increase would be around 10-11 percent. This price increase will be gradual and calibrated in nature, so to that extent, we do not expect any consumption impact because of the pricing change,” Shah said.
He added that in the very short-term there could be margin compression because price increase will flow in with a lag of month or two, but post that there should be margins maintenance. So, for the rest of the year, it could be mixed; in short term, some margin compression, and then the margins should start expanding, he said.
Also Read: Godrej Consumer Products Q2 Results: Net profit rises 5% to Rs 479 crore, misses Street estimates
“We have taken bolder price increase, which will get into the market late December-early January. By then we expect some of the price increase to mitigate the inflationary impact and the overall operating margins to come at parity over the next couple of months,” Shah said.
For the entire management interview, watch the video