The Hindu Business Line : India, Unilever's top emerging market

Mr Patrick Cescau, Unilever's Group CEO, is forceful and emphatic that India is the next big growth story for the foods and personal care products maker.

Meeting the media here for an hour, flanked by the HLL Chairman, Mr Harish Manwani, the Vice-Chairman, Mr M.K. Sharma, and the HLL CEO, Mr Doug Baillie, Mr Cescau said that developing and emerging markets already contributed 40 per cent to Unilever's turnover and India with a contribution of € 2 billion is the number one.

"The rate of growth currently in India is superior to the average developing markets, which is around 8 per cent... I expect India to be to Unilever what China has been to most other companies," he says.

Less aggressive

Admitting that Unilever and HLL lost of some of its aggression and competitive spirit, the group's 58-year-old French CEO says that over the past two years, he and his executive team have put some of that aggression back.

"When you go for a fight, you want to win, and the only indicator is market share," he stressed.

Setting the agenda for Mr Baillie and his team, Mr Cescau said that what he expects from "them is to bring back HLL to the top; it's fair to admit for the past two-three years there was a bit of criticism of the company. I want the balance to change and I want this company to again be the most-admired company and I have the team to do that.

"I expect the company to be outstanding and drive both gross and net margins.

"And, I expect HLL to be a net provider of talent and technology to Unilever and be a thought leader for new initiatives, new opportunities and new ideas." Mr Baillie, sitting beside, smiled to say: "No pressure!"

Mr Cescau explained that since 2005 his task has been to bring back Unilever to growth. And to do that he articulated a clear strategy to focus on high growth products and on developing and emerging markets while re-focusing on Unilever's strong leadership position across the world. To bring its European business back to growth the group was also aggressive on the cost base of Unilever.

"Our third quarter results have shown 5 per cent growth; we continue to invest in brands. We are still to see improvement on margins as we are facing a strong headwind in costs and inflation and that is challenging, However, I am confident that we are on the road to recovery.

"Performance in developing markets has been good and I feel Unilever is well on its recovery path," he stated.

HLL, he said, is a strong company and out of ten categories that the company operates in, it leads in eight. The company is back to double-digit growth, said Mr Cescau. "I see the benefits of all the efforts of past few years transforming the company. I am always excited about the change taking place in India, you feel the growth and excitement and I believe India can be an unbelievable success story. People talk about China, but I believe India will be the focus... it is at a tipping point."

Answering a question on the food business where HLL has not tasted spectacular success, Mr Cescau, says that India as a market for processed foods is not yet at a mature stage of development.

"But it is an opportunity; we have outstanding brands like Knorr, Kissan and Annapurnna and we need to capture the opportunity. He said that Unilever will bring together the competencies that exist in the Unilever structure and share them with the foods business in India. "We have competitive cost structures, brands and technologies, now these genetlemen have to deliver... " said Mr Cescau, nodding in Mr Baillie's direction.

He was emphatic that specific food brands would be developed for the Indian market. "We wont take a brand from abroad and transplant it to the Indian market, because the missing ingredient is deep consumer understanding, what are the wants and needs of the Indian consumer and what brands satisfy their needs... I don't want brands that are not suitable for India, that is a recipe for disaster. So it is so critical that Indian managers need to express these needs rather than have expat managers directing those needs," he said.

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