Emami shares hit a 52-week low of Rs 442.50, down 2% on the BSE in intra-day trade on Monday after the company announced the acquisition of Dermicool, one of the leading brands in the prickly heat powder and cool talc category, from Reckitt, for a purchase amount of Rs 432 crore, excluding taxes and duties. The stock dropped below its previous low of Rs 446, which was set on March 7, 2022.

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The acquisition is being funded through internal accruals, according to the firm, and is subject to standard closing conditions.

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The brand Dermicool is well-known for providing relief from prickly heat, and it has a strong customer connection due to its marketing campaign jingle, “Aaya Mausam Thande Thande Dermicool Ka.”

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It controls around 20% of the market in the high growth, low penetration category. Combined with its Navratna Cool Talc, Emami will become a leader in this niche category, which would also help realise synergetic benefits and optimize costs, Emami said in a press release.

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The company’s stock has underperformed the market, plunging 23% in the last six months compared to a 5% drop in the S&P BSE Sensex. It was down 6% in the previous year, compared to a 16% growth in the benchmark index.

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Emami reported a 5.05% rise in the December quarter net profit at Rs 219.52 crore as the company faced an increase in prices of key raw materials. The company had logged a profit of Rs 208.96 crore during October-December 2020-21, Emami said in a regulatory filing.

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Revenue from operations was up at Rs 971.85 crore during the quarter under review as against Rs 933.61 crore in the year-ago period. Total expenses were at Rs 630.31 crore in the quarter under review as against Rs 593.42 crore.

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Its domestic business grew 3% year-on-year over a base of 16% growth in the previous year, translating into a two-year compound annual growth rate (CAGR) of 9%.