Emami plans to acquire skin care business in sub-Saharan Africa

Emami is looking to acquire a skin care business in sub-Saharan Africa.

“We are looking for an acquisition in central and eastern Africa to get entrenched particularly in the local skin care market. The proposed acquisition would address the manufacturing, marketing and product needs of our basket in the geography”, Prashant Goenka, Director, who looks after the international business of the company, told this to Business Line here on Saturday.

This acquisition might happen in the short-term if things went right, he indicated.

After a setback in Saharan Africa, Emami has planned to expand agressively into sub-Saharan Africa. The company last year had put on the back burner its Egypt outfit and business because of continued political uncertainty.

Diminished value of investment in Pharmaderm Co SAE, Egypt, an Emami’s stepdown subsidiary, has been written off in the consolidated balance sheet of 2013-14 as a goodwill write-down of Rs 4.61 crore. Kenya and Uganda currently contributes around 12 per cent of the total international revenue of Emami.

Emami is significant ramp up in revenues from its international business this financial year. International business revenue of Emami has increased from Rs 137 crore in 2009-10 tp Rs 221 crore in 2013-14.

Emami commissioned its first overseas manufacturing facility in Bangladesh in 2012-13. Egypt was the second such facility. Emami now feeds its markets in Asia, Russia and Africa through exports.

For the last couple of years, the company has been studying consumer preferences in different markets.

“The gathered insights have led us to adopt new business strategies in different geographies overseas. For example, depending on weather condition, accepted ingredients or skin character, we have been localising our products overseas”, Goenka said.

Emami last year consolidated its position in Myanmar, Bangladesh, Kenya, Saudi Arab, UAE and Russia through implementation of this strategy. “We plan to launch four to five new product variants in West Asian and Russian markets this year”, said Goenka.

“In Myanmar, we have appointed a distributor. Here also we have introduced localised variants. In Bangladesh, we are increasing our capacity and planning to introduce a new variant of Navaratna hair oil”, the Emami Director said.

In Bangladesh Navaratna is the market leader in “cooling” hair oil segment. In Russia BoroPlus variants leads in antiseptic and wound-healing skincare cream category. Fair & Handsome in have made inroads in West Asia, Kenya and Uganda.

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