Marico Raises ASP Spend, Eyes Mid-Twenties Q2 Profit Growth
Marico lifted ASP investments in Q2 FY27 as India demand held up, with Parachute volume growth in early teens and operating profit seen rising mid-twenties.
Marico opened its September 2026 quarter with a clear signal: it is spending more behind its brands, not less. In its quarterly update, the company said advertising, sales and promotion (ASP) investments increased significantly as it continued to back brand building and growth initiatives.
The India business held up. Domestic demand remained resilient and the company reported strong underlying volume performance, even as it managed profitability across categories.
01 · Where the growth is coming from
- Parachute Coconut Oil recorded early-teens volume growth, credited to brand equity, consumer trust and its supply chain advantage.
- Value Added Hair Oils stayed in the twenties for a sixth consecutive quarter, helped by mid- and premium-segment investment, Project SETU’s direct reach and the Almond category expansion.
- Foods, premium personal care and digital-first brands continued adding to portfolio diversification.
- Saffola Oils saw mid-single-digit price-led growth, while volumes declined as Marico held profitability thresholds and rationalised select variants.
02 · Volume versus price: the real story
Parachute’s early-teens volume growth and Value Added Hair Oils’ sixth straight quarter in the twenties show volume-led momentum. Saffola Oils, by contrast, grew on price while volumes slipped. The ASP increase makes sense as a strategy to put more investment behind the portfolio’s stronger engines while Saffola is deliberately rationalised.
03 · Why the ASP increase matters
The company’s statement is the detail brand leaders should notice. “ASP investments increased significantly as we continued to invest in brand building and growth initiatives,” Marico said. That is a deliberate decision to fund demand generation while the core is strong, rather than treating marketing as a cost to trim.
At the consolidated level, Marico expects double-digit revenue growth for Q2 FY27. Gross margin is expected to improve strongly year on year, supported by the portfolio mix and lower copra costs. Operating profit is expected to grow in the mid-twenties.
International markets grew in constant-currency teens, led by Vietnam, the Middle East and South Africa. Bangladesh showed marginal sequential improvement despite a high base and inflationary pressures.
04 · What brand leaders can take from this
Marico’s update is a reminder that resilient categories reward continued investment. The company expects its first-half performance to surpass its near-term guidance across key financial parameters, driven by core franchises and newer growth engines, while it targets sustainable, profitable, volume-led growth over the medium term.
Marketing take
when demand is steady, fund the brands that built it, and don’t just price your way to growth.
Source: Afaqs!
