Mon Jan 29, 2007 7:11 PM IST
MUMBAI (Reuters) - Top battery maker Eveready Industries India Ltd. slipped to a third quarter loss on the combined effect of higher input costs and consumer resistance to price increases.
However, the company said on Monday there was no change in its fundamentals and it expected sales to improve soon.
"There was tremendous consumer resistance due to higher prices," Director Suvamoy Saha told Reuters. "We are waiting for the volumes to come back."
The company reported a net loss of 140.4 million rupees in the Oct-Dec quarter, compared with a net profit of 64.4 million rupees in the year-ago period.
Sales in dry cell batteries dropped 12.7 percent and flashlights by 31 percent in the third quarter. Its branded tea sales was higher by 35 percent in the quarter to Dec. 2006.
Eveready raised battery prices by 10-15 percent from Dec.1 due to a rise in zinc prices, a key input for batteries.
However, the magnitude of its pricing actions was "not usually seen in the FMCG (fast moving consumer goods) category", the company said in a statement.
"The consumer finally reacted to these pricing actions whereby consumption was slowed down or deferred," it said.
Shares in the company closed 0.3 percent higher at 73.45 rupees in the Mumbai market.
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