Emami Group: Personal care push

If you thought Kolkata-based Emami Group will take life easy after the acquisition of Zandu last year, your judgement could prove wrong. It has plans to invest some Rs 1,600 crore in its personal care business. This includes new products as well as extension and repositioning of brands.

The personal care market in the country is competitive and is growing at a fast clip. It has multinational corporations like Hindustan Unilever and L’Oreal as well as homegrown powerhouses like Marico, Dabur and Emami.

Emami was set up in 1974 by RS Agarwal and RS Goenka. But things took a turn for the worse and it was on the verge of sickness. Its fortunes began to improve once it acquired Himani in 1978. The brands in its portfolio include Navratna (hair oil and talcum powder), Boroplus (antiseptic cream and prickly heat powder), Fair and Handsome cream for men and Sonachandi Chyawanprash. The Rs 700-crore Zandu acquisition has added to the chyawanprash portfolio. The largest of course is Navratna which has annual sales in excess of Rs 200 crore. Next is Boroplus at around Rs 150 crore.

In a way, the revamp of the personal care business has already begun. “We have launched brand extensions for Navratna in talc and oils and have also launched summer and winter lotions as product extensions of Boroplus,” says Emami Director Aditya Agarwal.

He also gives a glimpse of the road ahead. “We will introduce new stock-keeping-units and variants under Fast Relief and Chawanprash. Also we will reposition brands like Sardi Ja which are not doing so well. These will be repositioned and repackaged for national launch,” says Agarwal. “We intend to launch a baby care range and more over-the-counter drugs this year. We are still working out the pricing strategies but these will be priced in the value segment, clubbed with freebies and other cross-promotions.”

Simultaneously, the group has lined up big investments in its other lines of business as well: Rs 1,600 crore in Emami Biotech, Rs 700 crore in Emami Paper Mills, Rs 1,000 crore in Emami Realty and about Rs 600 crore for other group companies including AMRI and Frank Ross. All told, the investments add up to Rs 5,500 crore.

Emami Paper Mills is looking to enhance the writing, printing, newsprint and coated papers capacity of its plant at Balasore in Orissa by 100,000 tonnes to 250,000 tonnes per annum. Emami Realty has plans to develop at least two residential projects in Hyderabad, one in Coimbatore, one in Mumbai and more than one in Kolkata. Plans for the AMRI chain of hospitals include a 300-bed hospital in Bhubaneswar and a 300-bed hospital for women and children in Kolkata. This, the group hopes, will increase its size from Rs 2,000 crore at present to Rs 6,000 crore.