▪Science Based Ayurvedic Products
The youngest chairman of Dabur,Amit Barman while speaking to ET, said his focus would be to enhance the above said points.
Amit Burman also commented about the status of the company saying,In the Rs 1,200 crore organised honey market, Dabur Honey’s market share dropped to almost 40% a year after Patanjali’s entry from about 60% three years ago. It has since recovered to about 54% now. In chyawanprash, Dabur’s share, which had slipped to 58% in 2016, has returned to over 60% now.
“It (Patanjali’s) was a disruptive strategy to kill competition by price, like it happens in many industries. But after the disrupting, things settle down and ultimately product quality and depth of distribution are what matter,”he said.
Dabur has also identified Eight power brands including Vatika shampoo, Red toothpaste, Real juice and Amla hair oil and is investing disproportionately to push them, said Burman, 50.
In skincare, where Dabur has had a relatively smaller presence, it plans to step up premiumisation and high-margin launches. It is creating products only for e-commerce in spaces such as babycare to leverage on the scale opportunity it presents. Online grocery sales for the fast-moving consumer goods sector are only 2% of the overall Rs 3 lakh crore-plus category presently but projected to increase 11% by 2030.
Another target, Burman said, would be expansion of the company’s rural reach to 55,000 villages by March 2020, up from 48,000 presently. Citing a sharp rural slowdown, market research company Nielsen revised its growth forecast for the fast-moving consumer goods (FMCG) sector to 9-10% in 2019 from its previous outlook of 11-12%.
Optimisation of logistics has brought incremental savings that were reflected in Dabur’s first-quarter top line. For the June quarter, it beat market expectations on all parameters with a 9.6% growth in domestic volumes and consolidated net profit rising 10.3% from a year earlier. Revenue increased 9.3% to Rs 2,273.3 crore. Company officials said on a post-earnings conference call that it was looking at mid to high single-digit volume growth for FY20.
Dabur, which has a Rs 3,000 crore war-chest for acquisitions, isn’t presently in active talks for potential buyouts in the domestic and overseas markets, Burman said.
Credits: Economic Times, BCCL.