MAM
Dabur Q2 ad spend subdued before raising the pitch during festival season
MUMBAI: Fourth largest FMCG company Dabur India‘s expenditure on advertising in the second quarter ended 30 September was 41 per cent more than a year earlier but was subdued compared to the preceding quarter.
It spent Rs 1.81 on advertising in the second quarter, which was much lower than Rs 2.30 in the first quarter ended 30 June. In the second quarter of previous year, Dabut‘s advertisement spend was Rs 1.28 billion.
However, this is the fourth quarter in a row when the company has substantially increased its marketing spends on a year-on-year basis. In the third quarter of fiscal year 2012, the advertisement expenses were up 46.9 per cent, in the fourth quarter up by 43 per cent and in the first quarter of this year up by 51 per cent.
The advertising and marketing spends constituted 11.85 per cent of total revenues for the second quarter of the current fiscal and 14.09 of the total expenses.
The fall in advertising spend in the second quarter from the first quarter was on account of advertising plans being held back for the festival season.
“It (advertising spend) has been a little muted in the second quarter compared to what we were in the first, largely on account of the festive season, which begins a little later. We break advertising now in October rather than September like we normally would have done,” Dabur CEO Sunil Duggal told a television channel.
Dabur expects its advertising spends to be around 12-12.5 per cent of sales for the whole of 2012-13. In 2011-12, Dabt spend a total of Rs 6.59 billion, which was 23 per cent more than in 2010-11.
Dabur‘s revenue in the second quarter were Rs 15.28 billion, up 20.6 per cent from Rs 12.67 billion a year earlier. The company‘s net profit grew by 16.09 per cent to Rs 2.02 billion in the second quarter from Rs 1.74 billion a year earlier.
For the half year ended 30 September, Dabur recorded 46.95 per cent increase in ad spends at Rs 4.1 billion. The company‘s revenue in the first half of this year stood at Rs 29.99 billion, up 21.07 per cent from Rs 24.77 billion a year earlier, while its net income grew by 16.56 per cent to Rs 3.52 billion in the second quarter from Rs 3.02 billion a year earlier.
Brands
Reserve Bank of India cancels Paytm Payments Bank licence
Central bank cites compliance failures; curbs tighten as wind-up looms
MUMBAI: India’s banking watchdog delivered its sharpest blow yet to Paytm Payments Bank, cancelling its licence and effectively ending its ability to operate as a bank under the law.
The Reserve Bank of India said the entity can no longer conduct banking business under the Banking Regulation Act, citing concerns that its affairs were not being run in the interest of depositors or the public and that it had failed to meet licence conditions.
The move escalates a crackdown that has been building for months. The bank had already been barred from onboarding new customers since March 11, 2022, and later faced restrictions on deposits, credit and wallet top-ups. In January 2024, the central bank ordered it to stop accepting fresh deposits, pointing to persistent non-compliance, including lapses in customer due diligence, use of funds and technology systems.
Operationally, the bank is now on a tight leash. It may process withdrawals of existing deposits and facilitate loan referrals through banking correspondents, but it cannot take fresh deposits.
The central bank said it would apply to the high court to wind up the bank.
Paytm sought to ringfence the fallout. In a regulatory filing, it said the licence cancellation applies to Paytm Payments Bank Limited, a separate entity, and should not be attributed to One 97 Communications. It added that there is no exposure or material business arrangement with the bank and that it operates independently, without Paytm’s board or management involvement.
“As informed earlier, Paytm (One 97 Communications Limited) and its services, which have been operating without interruption, will continue to operate uninterrupted. These include the Paytm app, Paytm UPI, Paytm Gold and all other services offered by its subsidiaries and associated companies,” the company said.
The distinction may reassure users of the app ecosystem, but the regulator’s verdict is unequivocal. After years of warnings, caps and curbs, the payments bank experiment at Paytm is being shut down—decisively, and with little room left to manoeuvre.
