Global Consumer Products plans to go big in FMCG space

Company plans to compete with the likes of established FMCG product-makers in the country through aggressive branding

FMCG company Global Consumer Products today launched its exclusive chocolate brand 'LuvIt' here, and is keen on diversifying product offerings, including beverages and nutrient water, in the next three-five years.

Stating this, its promoter A Mahendran said the company planned to compete with the likes of established FMCG product-makers in the country through aggressive branding.

To start-with, he said, the focus would be on establishing the company's brand in the south. According to him, south India was witnessing strong demand for FMCG goods, and was growing faster than other regions in the country.

Global Consumer has Goldman Sachs and Mitsui Ventures on its board. Mahendran, who is a former managing director of Godrej Consumer Products, is banking on the experience of its employees drawn from companies like Britannia Industries Ltd and Ferrero Group to drive the brand in the highly-concentrated and multi-product FMCG space.

The company's business model runs on engaging contract players for producing its FMCG goods.

“We have no plans to start a dedicated manufacturing facility for our products. We feel the contract manufacturing model could do the work without any business risks,” said Mahendran. He, however, said most of its capital investments would be earmarked for promoting the brand.

Its strategy is to penetrate the FMCG categories, which offer scope for product differentiation. In line with this, it is targeting the Rs 7,000-crore chocolate segment, with a focus on expanding presence in urban and semi-urban markets.

According to it, chocolate sales pan-India were growing at an annual 25 per cent, while the market penetration was low at 10 per cent.  He said in the next five years, the company was targeting to clock Rs 1,250 crore revenues, and expects to earmark a quarter of it back as investment for expansion.