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Marico Q1 ad spend up 61%; highest increase among peers

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MUMBAI: FMCG major Marico spent 60.82 per cent more on advertising in the first quarter of FY13. The company‘s spend on advertising and promotions was Rs 1.56 billion across various brands in the first quarter compared with Rs 972.43 million a year earlier.

In the first quarter, Marico‘s advertising costs accounted for 12.28 per cent of its total revenue, up three percentage points from 9.3 per cent a year earlier.

These figures are in tandem with the current trend of FMCG‘s increasing marketing spends with the rise in competition. The increase in ad spend for Marico is the highest amongst its peers so far with Dabur‘s at 51 per cent, HUL‘s at 30 per cent and Colgate 32 per cent

The company‘s revenue for the quarter ended 30 June 2012 stood at Rs 12.7 billion, an increase of 21.76 per cent from Rs 10.43 billion a year earlier. The profit for the quarter also rose by a sharp 45.88 per cent to Rs 1.24 billion in the first quarter from Rs 850 million a year earlier.

Marico said the volume growth for the quarter ended 30 June 2012 was 14 per cent.

In a statement, Marico said, "The medium to longer term outlook on all the company‘s three businesses remains positive. In the medium term, the company will focus on strengthening the building blocks for future value creation - strong equities for its existing brands amongst its consumers, volume growths, robust new product pipelines and operational effectiveness."

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