As the world celebrated the first International Yoga Day on June 21, the de-facto Yoga mentor on India, Ramdev, has slowly built an empire comparable to some of the prominent mid-sized FMCG companies in India.
Patanjali Ayurved Limited (PAL), the flagship company of the Patanjali group, reported a profit after tax (PAT) of Rs 316.60 crore (provisional) in FY15, and increase of nearly 71% over FY14, when it posted a net profit of Rs 185.67 crore, according to the rating rationale document on the company's bank loan facility, by credit rating agency Care. This brings Patanjali close to the ranks of FMCG companies like Emami and Marico. Emami posted a PAT of nearly Rs 486 crore for FY15, an increase of 20.70% over the previous financial year. Marico posted a net profit of 573.45 crore for FY15, an increase of 18.44% over the financial year 2013-14.
In fact, spurred by the popularity of brand Ramdev, Patanjali Ayurved has come up one of the fastest growing FMCG companies in India. Between 2012-13 and 2013-14, the company's net profit grew by nearly 103%, from Rs 91.33 to Rs 185.67 crore.
Apart from offering an array of products ranging from toothpaste to health drinks, Patanjali has also ventured into the e-commerce space.
Patanjali Ayurved was established in 2006 as a private limited company and subsequently converted into a public limited company in 2007. It has three manufacturing units located in Haridwar for manufacturing of its products with the retail sale of these products being done through Patanjali Arogya Kendra, Patanjali Chikitsalya, Swadeshi Kendra and more than 177,000 retail outlets spread across the country, according to document available with Care Ratings dated May 2015.
|NET PROFIT (Rs cr) TOTAL INCOME (Rs cr)|
|2011-12 55.89 453.38|
|2012-13 91.33 848.56|
|2013-14 185.67 1,191.14|
|2014-15 316.60 2,028.03|
|Source: Care rating rationale, May 2015 and September 2014|
While Patanjali Ayurved, which is involved the manufacturing and trading of FMCG, herbal and ayurvedic products is the flagship company of the Patanjali group, there are at least 40 companies under the name Patanjali in website of ministry of corporate affairs. According to sources, the total turnover of the Patanjali group exceeds Rs 2,000 crore.
Notably, at the helm of affairs at the Patanjali is Archarya Balkrishna, Ramdev's close aide.
The posts which Balakrishna holds at Patanjali includes, that of general secretary of Divya Yoga Mandir Trust and Patanjali Yogpeeth Trust, managing director of Vedic Broadcasting Limited (Aastha) and Patanjali Food & Herbal Park Private Limited, and Vice Chancellor of University of Patanjali. Balkrishna, who holds a post-graduate degree in Sanskrit, Literature and Yoga from "Gurukul", describes himself as "a multi-faceted genius and personality with knowledge and experience in the managerial, administrative and engineering fields" in his Linkedin profile.
Not everything perfect at Patanjali
Not everything is as rosy as it seems at Patanjali though.
In 2011, S K Patra, an alumnus of IIT Kharagpur and IIM Ahemdabad, joined PAL as the CEO of the company. Earlier, Patra had served as director, National Fertilizers Limited and had held top positions in companies like Metals and Minerals Trading Corporation of India (MMTC), Gujarat Narmada Valley Fertilisers (GNFC) and Shaw Wallace. However,in February 2014, Patra unceremoniously relinquished the post of CEO at Patanjali. Sources close to the development said the differences emerged over the way Patanjali was functioning, especially Patanjali Food and Herbal Park Private Ltd. Patra was not available for comments on the matter. Notably, In February 2014, around the same time when Patra stepped down from Patanjali, Care suspended ratings of Patanjali Food & Herbal Park Private Limited as the company failed to furnish the information required by Care for monitoring of the rating.
Patanjali food park was established in 2009 as a special purpose vehicle (SPV) for setting up of a mega food park in Haridwar under the mega food park scheme of Ministry of Food Processing Industries, government of India. The food park makes available services for establishing backward and forward linkages covering the entire food processing value chain. Patanjali Ayurved Ltd, holds 49% in the SPV while the balance is owned by other companies who are not part of Patanjali Group, according to data from Brickwork Ratings, April 2014. The rating agency relied upon the audited financials of the food park from FY11 to FY 13, projected financials for FY14, FY15 and clarifications provided by the company, the rating rationale said. Further, it said, the food park project was taken up at an initial cost of Rs 95.08 crore, which got a government grant of Rs 50 crore for the project. The net profit of the food park increased from 28.66% in FY12 to 33.78% in FY13, the rating rationale said.
Another important wing of the Patanjali group, the Patanjali Yogpeeth (Trust), founded in February, 2005, has seen surge in donations in the last few years. The donation income of the trust increased to Rs 87.89 crore in FY14 (provisional financial information), against Rs 64.92 crore in FY13 and Rs 44.86 Cr in FY12, according to data from Brickwork ratings dated July 2014. The trust generated a PAT of Rs 3.57 crore in FY13 as against Rs 34.79 crore in FY 12, mainly due to donation assistance given to its other trusts treating the same as other expenses. The trust had a tangible net worth of Rs 266.71 crore in in FY13, according to Brickwork Ratings.
Surely, celebrating International Yoga Day was a rewarding idea for Prime Minister Modi, but practicing Yoga has been a lucrative deal for Ramdev.