After becoming almost debt-free, home-grown Jyothy Laboratories Ltd is now planning to acquire regional brands worth up to ₹500 crore for its fast-moving consumer goods portfolio.

“Since national brands are more expensive, we would like to acquire regional brands ranging between ₹200 to ₹500 crore. These could be brands in adjacent categories like hair care and body care, where we are not present currently,” said Ulhas Kamath, Joint Managing Director. “We could also make these regional brands go national once they are in our portfolio.”

The company had raised ₹263 crore through a preferential allotment late last year, and is now ready to use the same for acquisitions.

“Raising money is not a problem for the company and being almost debt-free, we are now in a position to grow inorganically,” Kamath said.

He, however, added the company is facing challenges in large categories such as soaps and detergents. “Detergent is the largest and most challenging category for us as there is intense competition and high inflation has led to increased costs.” Jyothy’s premium brand Henko (from the acquired Henkel portfolio) is poised to be relaunched this year with some more lather in the detergent category. Having a rural focus has helped Jyothy at a time when the urban markets have slowed down. “Today, almost 60 per cent of our sales turnover comes from the rural markets. Growth in the rural markets is at 25 per cent, while urban markets have slowed down to 7-8 per cent,” added Kamath.

Jyothy’s urban-focussed brands are Exo (dishwash), Margo (soap), Pril (dishwash) and Henko (detergent).

In the laundry business under its subsidiary, Jyothy Fabric Care Services, the company would consolidate operations, with no planned acquisitions this year. Though the business has turned profitable in places such as Bangalore, it continues to lose money in Delhi.

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