The disruption is temporary; the resilience is enduring.
We are passing through one of the biggest upheavals in living memory.what until the start of the last financial year was only a cyclical slowdown. A farmsector The Novel Corona Virus (COVID-19) aggravatedslowdown affected rural consumption. Adelayed winter affected the offtake of winter portfolio/products. A sluggishmacro-economic environment resulted in a decline in consumer spending on discretionaryproducts.
A combination of these factors affected the performance of the FMCGsector which reported one of the slowest growth rates in years.
This slowdown affected the performance of Emami Limited as well.
Challenging times. Inspiring responses
Emami belives that the disruption is temporary and resilience ispermanent. Emami believes that the disruption is temporary and resilience is permanent.
At Emami we deepened our focus working on the pharmacological studiesof ayurvedic ingredients and reinforcing their efficacy herb effectiveness scientificdata aggregation and global product acceptance. To strengthen our research wecollaborated with government research institutions and Ministry of AYUSH to introduceresearch-based products that targeted lifestyle diseases.
At Emami we are convinced that the more sustainable companies arethose that remain competitive across market cycles. In view of this we initiated ProjectWOW (War on Waste) to moderate costs with the help of a global management consultancy. Toenhance logistics efficiency
Emami optimised routes reducing its carbon footprint. At Emami webelieve that the wider the product availability the stronger the offtake. We strengthenedour distribution model by enhancing our presence across the modern trade and online retailchannels to rationalise our dependence on general trade. We enhanced our direct reachprovided hand-held devices to our sales team members and strengthened our distributioncoverage and analytics. In response to the growing need for modern trade formats(including e-commerce platforms) Emami launched platform-specific products and SKUs.Besides we overhauled our global distribution channel in key geographies integrating theCreme 21 acquisition consolidating key markets and strengthening our internationalbusiness.
At Emami we believe that sustainable companies possess strong brandsthat generate multi-year revenues. The Company introduced innovative brand extensionsstrengthening their relevance across the seasons. Emami re-launched a number of productsaround improved formulations as well generating excitement and renewed vigour andbuilding on an existing positive recall. In view of the growing demand for hygiene andimmunity-boosting products following the outbreak of COVID-19 we launched a hygiene rangeunder the BoroPlus brand and various immunity-building products like AYUSH Kwath Kadha andsingle herbs range / under the
At Emami we believe that businesses need the right architecture toremain sustainable. Emami leveraged its Family and Business Council structure; the apexfamily council comprised second generation Promoter-Directors headed by the Founderswhile the Business Council comprised the Founders second generation Directors andprofessional business heads. These councils converged periodically to navigatebusiness-strengthening decisions an effective governance model. Emami reinforced itsposition as a company that shares upsides liberally. Our Board approved a H192 crorebuyback offer at a price not exceeding H300 per share. We believe that this buyback willreduce the number of shares outstanding at a good price enhancing shareholder valueacross the future.
Emami is adequately prepared to capitalise on sectorial opportunities.The
Company's Power Brands possess attractive headroom which coulddrive Emami's growth in a sustainable way.
Note of thanks
We must extend our gratitude to all our stakeholders for reposing theirconfidence in us.
The disruption may be temporary; the resilience is enduring.
We believe that this ongoing adversity opens opportunities to enhancestakeholder value.
|RS Agarwal and RS Goenka |