Dispirin, Dettol Shift To Hit Reckitt Bottomline

Reckitt & Colman of India would register lower growth this year due to licensing of products like Dettol and Dispirin to the joint venture with Piramals, company managing director Ashok Pradhan said.

We expect to grow only 17 per cent this year because some of the products have gone to the joint venture company. But the dividend would come. So we would not lose much, Pradhan said. He, however, said the hiccup (lower growth rate) would be there only this year. After this year, we should be able to clock greater growth, Pradhan said.

Reckitts registered a growth of over 26 per cent in turnover in 1997 at Rs 383.57 crore as against a turnover of Rs 304.34 crore in 1996. While growth in 1996 was 18.91 per cent, that in 1995 and 1994 were 17.6 per cent and 15 per cent respectively.

 

The 60:40 joint venture with Nicholas Piramal was formalised in September last year to increase penetration into the rural markets and for marketing and distributing over the counter products of both companies. Nicholas Piramal India is one of the largest prescription pharmaceutical companies with a wide network across the country.

To counter any decline in growth rate the Indian subsidiary of the British parent company Reckitt & Colman Plc will introduce 10 new products in five thrust areas this year. Thrust areas, which could witness the product launches or new product extensions, are pest control, surface care, toilet care, shoe and laundry care, he said. We could be bringing new products from the parent company, Pradhan said, refusing to disclose names of the products the company intends to launch here.

Reckitt India manufactures leading products like Dettol, Cherry Blossom, Harpic, Dispirin and Brasso. It had recently acquired Burnol from Knoll India. Pradhan said, with the formation of the joint venture with Piramals, Reckitts would be able to concentrate better on marketing its household products.

Our growth and new products introduction would be better this year than in the past as we can focus better, Pradhan said.(PTI)

Dettol and Dispirin, which together constitute about 30 per cent of the turnover, have been shifted to the joint venture. On Burnol, acquired from Knoll India for Rs 12 crore last year, he said Reckitts would give a new thrust by an advertising campaign.

The company has chalked out a plan for Burnol under which the brand will start generating a revenue of about Rs 20 crore in three years time. Last year, Reckitts sold Epilex brand as it did not fall in the category of OTC. The ownership in the trade mark Epilex, together with the marketing know-how for the Epilex brands and syrup has been sold for Rs 8 crore. Pradhan said they would increase its advertisement expenditure by about Rs 50 crore to Rs 60 crore this year. (PTI)