FMCG & lighting drive growth for Wipro Consumer in Q4

Wipro's consumer care division, now demerged and part of an unlisted entity, Wipro Enterprises, reported a 15 per cent growth in topline and an 18 per cent growth in operating income at Rs 1,044 crore and Rs 134 crore, respectively, for the quarter ended March 31.

For the full year ended March 31, the consumer business reported a 22 per cent growth in topline and a 27 per cent growth in operating income at Rs 4,059 crore and Rs 501 crore, respectively.

"If you add the acquisition of Singapore-based L.D. Waxson, which was consolidated in the March quarter of the 2012-13 fiscal, then our growth for the full year is higher at 24 per cent in terms of topline and 29 per cent in terms of operating income," said Vineet Agrawal, president, Wipro Consumer Care & Lighting.

Wipro's international consumer business gives the division 48 per cent of its revenues, while the balance 52 per cent comes from domestic operations.

The company's largest brand Santoor grew in the range of about 18-20 per cent for both the quarter and the full year ended March 31, 2013 driven by growth in rural areas. On an All-India basis, Santoor has a rural market share of 10.8 per cent and urban market share of 6.8 per cent, giving it a combined market share of about 8.4 per cent. This places it at No. 3 after Hindustan Unilever's Lifebuoy and Lux soaps, respectively.

Analysts estimate Santoor could cross the Rs 2,000-crore-mark in terms of sales by the second quarter of 2013-14 if it continues growing in high double-digits. In the fourth quarter, the company has stepped into baby soaps, launched a facewash range, and relaunched its deodorant portfolio - all under Santoor.

Agrawal says the company continues to test-market its shampoo range under Santoor in Andra Pradesh, with no immediate plans to roll it out across the country. "We launched the range in November in Andra Pradesh. At the moment, we continue to test-market this range in that state," he said.

While Wipro does not give up a break-up of individual segments within its consumer business, analysts say the fast-moving consumer goods (FMCG) vertical remains the largest for the company, giving it 60-70 per cent of its revenues. The balance comes from lighting, furniture and switches, which are comparatively smaller, but all growing in double-digits.

According to Parag Kulkarni, vice-president and business head (commercial lighting and furniture business), Wipro Consumer Care, LED lighting in particular has seen growth upwards of 70 per cent in the fourth quarter, driven by innovations and new designs.

"This is an emerging category and a fairly new one for us. The response we have received for these products have been good," Kulkarni added.