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Bajaj Consumer Care Ltd

| Annual Report for the Financial Year 2024–25

BULLISH SENTIMENT

Report Source

⬤18th Jul 25

Summary : Bajaj Consumer Care demonstrated resilience and strategic growth in FY25, driven by digital expansion, portfolio diversification through acquisition, and operational efficiencies, despite market headwinds.

Annual Report Analysis & Insights

Financial Disclosures

  1. Cost of materials consumed (Standalone) FY25: INR 26,678.72 lakhs (FY24: 25,000.36 lakhs).
  2. Employee benefit expenses (Standalone) FY25: INR 10,646.93 lakhs (FY24: 9,631.42 lakhs).
  3. Advertisement and Sales Promotion expenses (Standalone) FY25: INR 13,780.89 lakhs (FY24: 16,000.04 lakhs).
  4. Other expenses (Standalone) FY25: INR 27,201.51 lakhs (FY24: 27,817.81 lakhs).
  5. Trade receivables outstanding ageing schedule provided for March 31, 2025 and March 31, 2024.
  6. Undisputed Trade receivables - Considered good FY25: INR 7,362.13 lakhs (FY24: 4,374.03 lakhs) for standalone.
  7. Undisputed Trade receivables - Considered good FY25: INR 7,242.64 lakhs (FY24: 4,442.90 lakhs) for consolidated.
  8. Standalone Revenue from Operations FY25: INR 92,768.50 lakhs (FY24: 95,156.79 lakhs).
  9. Consolidated Revenue from Operations FY25: INR 96,482.50 lakhs (FY24: 98,412.06 lakhs).
  10. Other Income (Standalone) FY25: INR 3,552.96 lakhs (FY24: 4,464.91 lakhs).
  11. Other Income (Consolidated) FY25: INR 3,555.25 lakhs (FY24: 4,466.78 lakhs).
  12. Standalone Net Cash from Operating Activities FY25: INR 6,791.35 lakhs (FY24: 11,843.29 lakhs).
  13. Consolidated Net Cash from Operating Activities FY25: INR 6,509.83 lakhs (FY24: 11,633.10 lakhs).
  14. Standalone Net Cash from Investing Activities FY25: INR 15,394.25 lakhs (FY24: 804.16 lakhs).
  15. Consolidated Net Cash from Investing Activities FY25: INR 15,533.38 lakhs (FY24: 1,264.21 lakhs).
  16. Standalone Net Cash (Used in) Financing Activities FY25: INR (21,159.25) lakhs (FY24: (11,981.99) lakhs).
  17. Consolidated Net Cash (Used in) Financing Activities FY25: INR (21,159.25) lakhs (FY24: (11,981.99) lakhs).
  18. Claims against the Company not acknowledged as debt (Indirect tax) FY25: INR 932.31 lakhs (FY24: 935.91 lakhs) for standalone.
  19. Claims against the Company not acknowledged as debt (Indirect tax) FY25: INR 932.31 lakhs (FY24: 935.91 lakhs) for consolidated.
  20. Standalone Total Assets FY25: INR 93,188.35 lakhs (FY24: 1,00,958.72 lakhs).
  21. Consolidated Total Assets FY25: INR 90,106.64 lakhs (FY24: 98,358.34 lakhs).
  22. Standalone Equity Share Capital FY25: INR 1,370.53 lakhs (FY24: 1,427.94 lakhs).
  23. Consolidated Equity Share Capital FY25: INR 1,370.53 lakhs (FY24: 1,427.94 lakhs).
  24. Standalone Other Equity FY25: INR 77,467.23 lakhs (FY24: 85,121.42 lakhs).
  25. Consolidated Other Equity FY25: INR 73,419.15 lakhs (FY24: 81,630.29 lakhs).
  26. No long-term debt reported for standalone or consolidated.
  27. Disclosed in Notes to Standalone Financial Statements (Note 49) and Consolidated Financial Statements (Note 51).
  28. Transactions include royalty expense, rent expenses, sales of goods, remuneration, sitting fees, and professional fees.
  29. Outstanding balances include royalty, rent, investment in equity, sitting fees, and professional fees.
  30. Both standalone and consolidated financial statements are provided.
  31. Consolidated statements include subsidiaries: Uptown Properties and Leasing Private Limited, Bajaj Bangladesh Limited, Bajaj Corp International (FZE).
  32. Consolidated statements include associate: Vishal Personal Care Limited (w.e.f. March 10, 2025).

Corporate Overview

  1. Domestic (India): Strong footprint in both urban and rural markets, with focus on Hindi-speaking markets (HSM) and South India.
  2. International: Presence in 30+ countries across Middle East, Africa, Nepal, Bangladesh, South East Asia, US, UK, Australia, NZ, primarily catering to the South Asian diaspora.
  3. Shifting consumer trends and evolving lifestyles.
  4. Cost headwinds and global uncertainty.
  5. Fluctuating input costs (palm oil, coffee, copra, wheat).
  6. Intensifying competition from new-age brands.
  7. Urban demand impacted by food inflation and high interest rates.
  8. Raw material prices (crude oil, LLP, edible oil, copra, packing materials).
  9. Monsoon season for rural demand.
  10. Government policies and fiscal prudence.
  11. Digital adoption and e-commerce platforms.
  12. FMCG company specializing in personal care products.
  13. Portfolio includes hair oils, skincare, lotions, soaps, and haircare items.
  14. Operates through a mix of company-owned and third-party manufacturing setups.
  15. Expanding global presence and strengthening brand connections.
  16. Strategic, resilient, and progressive.
  17. Committed to long-term value creation and sustainable growth.
  18. Focused on innovation, consumer-centricity, and operational excellence.
  19. Confident in future transformation and double-digit growth.
  20. Mass-market consumers seeking affordable and accessible personal care products.
  21. Beauty-conscious consumers with evolving needs for natural, effective, and tailored offerings.
  22. Younger consumers and urban population seeking light and non-sticky hair oils.
  23. Consumers in rural India, driven by increased incomes and aspirations.
  24. Hair Oils (Bajaj Almond Drops Hair Oil, Bajaj 100% Pure Coconut Oil, Bajaj Amla Oil)
  25. Skincare products (Nomarks, Natyv Soul)
  26. Lotions, Soaps, Haircare items
  27. Ethnic Range (100% Pure Henna, Gulab Jal)
  28. 2 Own manufacturing units (Paonta Sahib, Guwahati).
  29. 9 Contract Manufacturing Units.
  30. 20 Warehouses.
  31. 9 Corporate & Regional Offices.
  32. 7,700+ Channel Partners.
  33. 43 Lakh+ Retail outlets.
  34. Acquisition of Vishal Personal Care Private Limited (Banjara’s brand) in two tranches (49% in FY25, remaining 51% subsequently).
  35. Project Aarohan: Route-to-market transformation to expand distribution network (24,000+ new outlets, 1,300 new towns).
  36. Investments in smarter manufacturing processes and technology at Guwahati and Paonta plants.
  37. Expanding product offerings, particularly Almond Drops hair and skin range and Bajaj 100% Pure Oil portfolio.

Risk Factors

  1. Rising input material costs impact margins.
  2. Intense competition affects market share.
  3. Consumer preference shifts pose challenges.
  4. Geopolitical tensions create market uncertainty.

Key Drivers

  1. Banjara's acquisition diversifies personal care.
  2. Digital acceleration drives e-commerce growth.
  3. Project Aarohan expands market reach.
  4. Innovation strengthens product portfolio.

Auditor’s Report

  1. Unmodified opinion on standalone financial statements.
  2. Unmodified opinion on consolidated financial statements.
  3. Revenue Recognition: Complexity in estimating discounts, incentives, and rebates, leading to risk of misstatement.
  4. Management's responsibility for assessing going concern and preparing financial statements.
  5. Auditor's responsibility for obtaining reasonable assurance and identifying material misstatements.

Board Commentary

  1. Mr. Naveen Pandey appointed as an Additional Director and Managing Director effective July 1, 2025.
  2. Mr. Jaideep Nandi's tenure as Managing Director ends on June 30, 2025.
  3. Mr. Sumit Malhotra re-appointed as Non-Executive, Non-Independent Director for a term of five years effective July 1, 2025.
  4. Mr. Vimal Chandra Nagori retires by rotation and offers himself for re-appointment.
  5. The Board of Directors do not propose to declare any Final Dividend for FY 2024-25.
  6. No dividend was declared during the year under review.
  7. Risk of revenue misstatement due to inaccurate estimates of discounts and rebates.
  8. Risk of overstating revenue by influencing computation of rebates and discounts.
  9. Risks related to fluctuations in raw material prices.
  10. Risks from highly competitive FMCG market and aggressive competitor spending.
  11. Risks from unexpected changes in regulatory framework affecting profitability.
  12. No material legal or regulatory issues were reported.
  13. The Company has complied with all mandatory requirements of Listing Regulations.
  14. Acquisition of 49% equity capital in Vishal Personal Care Private Limited (Banjara’s brand) in FY25, with the remaining 51% to be acquired subsequently.
  15. Buyback of 57,41,000 equity shares at INR 290/- per share, totaling INR 16,649 Lakhs, concluded on July 11, 2024.

Corporate Governance

  1. Adopted a Code of Ethics (Code of Conduct) for Directors and Senior Management.
  2. Implemented a Whistle-Blower Policy (Vigil Mechanism) for reporting concerns.
  3. Anti-corruption and anti-bribery policy as part of Code of Conduct.
  4. POSH Internal Complaints Committee (ICC) in place.
  5. Board comprises 4 Independent Directors, including one Women Independent Director.
  6. Independent Directors confirm meeting independence criteria and possess requisite qualifications.
  7. Independent Directors are not aware of any circumstances impairing their duties.
  8. Audit Committee (4 Independent Directors).
  9. Nomination, Remuneration & Corporate Governance Committee (3 Independent Directors).
  10. Stakeholders Relationship Committee (5 members, majority Non-Executive/Independent).
  11. Corporate Social Responsibility (CSR) Committee (4 members, majority Independent).
  12. Risk Management & ESG Committee (4 members, majority Independent).
  13. Buyback Committee (3 members, majority Non-Executive/Non-Independent).
  14. No instances of non-compliance on capital markets matters in the last 3 years.
  15. No penalties or strictures imposed by SEBI.
  16. No fraud reported by auditors during the year.

Management Discussion & Analysis

Future Strategy

  1. Strengthening market presence in traditional and modern retail spaces through targeted marketing and product innovations.
  2. Optimizing product formats and pricing to meet diverse consumer group requirements.
  3. Enhancing digital presence and optimizing product portfolio for online shoppers.
  4. Continuing to scale global reach and staying abreast of emerging consumer trends.
  5. Delivering consistent double-digit growth and expanding EBITDA margins in FY26.

Industry Overview

  1. Indian FMCG sector is dynamic and transformative, driven by digital adoption and demand for value-added, health-conscious products.
  2. FMCG sector poised for modest revenue recovery of 100-200 basis points, reaching 6–8% growth in fiscal 2026.
  3. Indian hair oil market projected to grow to USD 6.20 billion by 2033 (CAGR of 3.6%).
  4. Indian beauty and personal care (BPC) industry projected to expand at a CAGR of 5.6% to USD 46.6 billion by 2032.
  5. Growing demand for natural, organic, and herbal-based personal care products.

Macroeconomic Outlook

  1. Global economic growth declined marginally to 3.2% in 2024, with slowdown in manufacturing.
  2. Indian economy demonstrated remarkable resilience and strong growth, supported by robust consumption and prudent fiscal policies.
  3. Inflation eased to 3.34% in March 2025, lowest since August 2019, raising hopes for further repo rate cuts.
  4. RBI revised India’s GDP growth forecast for FY2025-26 to 6.5%.
  5. Global trade uncertainties and geopolitical tensions remain a significant risk.

Operational Focus Areas

  1. Refining distribution network and optimizing VAN network for cost efficiency (Project Aarohan).
  2. Investing in smarter manufacturing processes and technology at Guwahati and Paonta plants.
  3. Enhancing core competencies and manpower productivity.
  4. Strengthening consumer connections and expanding footprint through targeted promotions.
  5. Building a motivated, engaged, and future-ready team through HR initiatives.

Performance Drivers

  1. Strong growth in modern trade and e-commerce (e-commerce grew 29% in FY25).
  2. Robust international business growth (20% y-o-y).
  3. Strategic marketing efforts and on-ground initiatives (Kumbh Mela, digital campaigns).
  4. Operational excellence through process optimization, alternative vendors, and automation.
  5. Acquisition of Banjara’s brand, diversifying personal care portfolio.

Risk Control Measures

  1. Monthly ExCom meetings to discuss profitability and forecasts, implementing corrective actions.
  2. Scaling NPD portfolio with planned product launches for specific channels.
  3. Actively exploring M&A opportunities for domestic and international markets.
  4. Continuously engaging with consumers to understand taste and behavioral changes.
  5. Conducting brand health studies and incorporating GenZ panel for younger audience insights.
  6. Using a healthy mix of traditional and digital media for ADHO and other brands.
  7. Proactive retention through career progression initiatives (Shikhar – ASE).
  8. Structured onboarding experience (Aarambh) to strengthen mentorship.
  9. Risk assessment for major raw and packing material, developing alternate vendors and contingency plans.
  10. Implementing advanced cybersecurity solutions (MDR, WAF) and regular security patches.

Critical Risks

  1. Inflation results in increased input material prices.
  2. Economic slowdown impacting consumer purchasing power.
  3. Over-dependency on few products/channels/geographies impacting revenue.
  4. Shift in consumer tastes and preferences.
  5. Rising competition from new age brands.
  6. High attrition rate impacting organization stability.
  7. Lack of robust succession planning for key roles.
  8. Inadequate supply of raw materials due to disruptions.
  9. Counterfeiting/infringing products leading to revenue loss.
  10. Breach of cyber security or unauthorized access to IT systems.