'Expect improvement barring macro shocks'

Saffola cooking oil maker Marico Ltd expects household demand to improve in the second half of FY24, provided no major global headwinds impact the commodity cycles. On Monday, Marico reported a 3% jump in domestic volumes for the September quarter. Demand for fast-moving consumer goods was broadly in line compared to the preceding quarter, the company said. In an interview, Marico’s managing director and chief executive Saugata Gupta said the urban markets continued to outperform rural for the food and personal care firm, but he expects a gradual recovery in rural demand in the coming months. Edited excerpts:

- Suneera Tandon

Marico’s ad-spending for Q2 was at a multi-quarter high even as it plans to pump in more money toward marketing its brands. Is this the outcome of cooling commodity prices?

We are on a diversification journey. So, whether for our digital brands—in foods, in premiumization of the core—it requires investment. Besides, we have invested significantly in analytics and we are ensuring there is lower wastage in spending. For example, I believe a lot of trade spending we do, leads to just loading (of stock) and not necessarily off-take.

So, resource allocation should be towards creating long-term equity for brands and category penetration. Cutting advertising and promotion costs to manage short-term profits is something which we don’t believe in. Historically also, we have not cut A&P drastically to manage high input costs.

How has been the on-ground demand across categories for Marico in Q2?