Orkla India Q1 FY27 Earnings Call Transcript Released

Orkla India Limited has released the transcript of its Earnings Conference Call for the quarter ended June 30, 2026. The call, conducted on August 04, 2026, featured insights from Managing Director and CEO, Mr. Sanjay Sharma, and CFO, Ms. Suniana Calapa.

During the call, the management highlighted an encouraging start to the financial year, with revenue from product sales growing by 11.5% and maintaining a healthy EBITDA margin of 17.5%. This performance was attributed to the strength of their brand portfolio and business model resilience. The company operates in spices and convenience food categories, with a significant focus on South India, which contributes 70% of its revenue. International business accounts for 21% of overall revenues.

The company addressed the macro-economic backdrop, noting resilient GDP growth in India but also mindful of risks such as inflation, tensions in West Asia affecting commodity prices, and monsoon progression. They are focused on agility, cost discipline, supply chain resilience, and investing in brands and growth initiatives.

Raw material inflation, particularly for chili (up 78%) and coriander (up 40%), was a key challenge, with spice prices seeing a 32.8% increase year-on-year. Orkla India has implemented pricing actions, with the impact rising from 6.5% last quarter to 11.4% this quarter, alongside driving operating efficiencies.

Business highlights included broad-based growth across categories, channels, and geographies. Domestic business grew by 11.8%, while international business grew by 10.1%. Digital commerce saw significant growth of 38.1%, and modern trade grew by 18.6%. The company introduced 23 product launches and re-launches during the quarter.

The spice business reported an 11.3% revenue growth, with domestic sales (excluding Kerala) growing by 16% and volume growth at 5.2%. Innovations like MTR North Karnataka Podis and MTR Prakriti premium spices were highlighted. The convenience food portfolio grew by 11.9%, led by the meals portfolio, with a focus on authenticity and taste.

The Kerala distribution restructuring project, initiated in February 2026, is progressing, showing a 14% improvement in sales productivity and a 6% increase in effective coverage for the food program. The company is also accelerating its breakfast portfolio, including dry and wet batters, and has launched new innovations for Gen Z.

Project Bolt, aimed at building digital commerce capabilities, is well underway, contributing to a 38.1% year-on-year growth in digital commerce and increasing its share of domestic revenues to 8.9%. International business delivered 10.1% growth, with the GCC region showing an 18.1% increase.

Financially, revenue from operations increased by 10.4% year-on-year to ₹659 crores. EBITDA stood at ₹115 crores, with EBITDA margins at 17.5%. PAT before exceptional items grew by 9.7% to ₹87 crores. Underlying EBITDA growth, excluding Project Bolt investments and PLI benefits, was 12.7% with a 40 basis points margin expansion.

Management reiterated their ambition for double-digit growth, focusing on expanding volumes and building the convenience food portfolio, which is less impacted by inflation. They aim to grow at least 1.5 times the GDP growth in the long term.