The Hindu Business Line : There is lot more in agarbattis than just good smell

Take a short, thin bamboo stick about 10 inches long, roll a dough of charcoal paste on it, dip it into a fragrant solvent and you have the product — the agarbatti. Few can plead guilty to not having felt pleasure at a deep-inhale of its aromatic discharge.

But there is a lot more to an incense stick than just good smell. Research, quality control, and importantly marketing. Or else, why would a company like ITC Ltd, or an institution like the Exim Bank of India, involve themselves with it?

Deep in a decrepit, long-forgotten village near Mayiladuthurai, in Tamil Nadu, a bunch of women settle down each morning to rolling charcoal dough on bamboo sticks (that come from Tripura). Chances are bleak that any of them would have heard of a city called Singapore, but what their hands roll, finds its way onto the shelves of Mustafa. Who knows, the agarbatti may find its match (pun intended) in a Buddhist monastery in Taiwan.

ITC has made a small beginning in exporting agarbattis. It is today worth just a crore of rupees, set to double this year. But according to V.M. Rajasekharan, CEO, ITC-Agarbatti Business, there is a huge opportunity waiting on the shelves of overseas supermarkets, particularly in countries with NRI population.

ITC began marketing agarbattis only two years ago. The Mangaldeep brand has about 2-3 per cent of the Rs 1,200-crore market that is growing 7 per cent a year — but the importance of the business lies in the fact that it provides livelihood to some 7,000 women in the country.

Training project

To develop this fledgling business further, ITC has started a training project called ASHA, which stands for Assistance in Social Habilitation through Agarbattis. Training is provided to produce incense sticks to quality standards recommended by International Fragrance Regulatory Association, Geneva, with a buyback assurance. A vendor has set up a unit in Tripura to produce 2 million bamboo sticks a year — the unit employs about 1,000 people.

Rajasekharan expects a 15 per cent growth in turnover this year. ITC's major advantage in this highly fragmented market, where the leader Cycle Agarbattis has only an 8 per cent share, is that it can put the product in 5 lakh outlets straightaway. ITC Ltd sells its various products through a vast network of 20 lakh outlets, including its rural hypermarkets, `Sagar Choupal'. At the back of his mind, Rajasekharan has an idea of bringing in more products under the `Mangaldeep' brand — village-made products that could be sold through this network.

Exim Bank's role

Exim Bank of India has helped ITC in its efforts to export. "We were able to leverage our strong presence in overseas markets, especially, Singapore, South Africa and the US, to get a footprint for Mangaldeep," notes K. Muthukumaran, Chief General Manager, Exim Bank.

In fact, Exim Bank has been assisting other small and tiny firms too to export their products.

A case in example is that of a Rs 75-lakh `cottage industry' called Subiksha Ayurvedics. This Coimbatore-based firm has developed a range of proprietary agarbatti flavours, which include rosemary, jasmine, honey and cinnamon. Subiksha Ayurvedics' Poorna Prakash Vittal says when the company found a Brazilian buyer over the Internet and needed funds to scale up production, the Exim Bank chipped in with credit. Over 30 women employees work for Subiksha, which sells agarbattis under the brand name of Agni.

Fragrances

Vittal told Business Line recently, that Subiksha does a lot of in-house research on fragrances and markets. It has developed processes for making fragrances stick longer. The firm has also discovered some interesting marketing facts. For instance, in Brazil, cinnamon flavour is believed to bring luck for love. A guy would light a cinnamon incense before proposing to a girl.

ITC has also done some research. It collected samples of air in temples and analysed them for fragrance and has just introduced in the market a product— Mangaldeep Yantra — that smells like the air in temples— camphor, coconut and all that. Bringing temples to your homes, says Rajasekharan.