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SHK expects moderate revenue growth in H1 FY19
Jul-19-2018

S H Kelkar and Company (SHK) is expecting revenue growth in H1 FY2019 to moderate mainly due to supply side disruptions caused by significantly lower availability and unprecedented price surge in key raw materials. Consequently, earnings are also expected to moderate in H1 FY2019. Encouragingly, the revenue and volume growth in the core Fragrance division continues to remain positive. While the company has taken measures to mitigate cost pressure through price increase and plans to take further such steps, the pass through of the same to margins is expected to start reflecting over the next few quarters. By this time the company also expects the raw material availability situation to be restored to more normal level.

The underlying fundamentals of the company’s business remain robust and customer engagement continues to be solid. Demand in the domestic FMCG industry is witnessing healthy traction. The company firmly believes the muted performance expected for H1 FY2019 to be transient in nature and the medium to long-term outlook remains positive. The company continues to deepen its customer engagements and its operations are geared to deliver revenue growth and robust margins in the future.

SHK is a fragrance manufacturer in India. The company operates in two segments: Fragrances, which manufactures/trades in Fragrances and aroma ingredients for Fragrances, and Flavours, which manufactures/trades in Flavors.

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