Comments
Backed by recoveries in discretionary spends and a growth in its healthcare portfolio, home-grown FMCG company, Emami is eyeing a “double digit growth” in turnover this fiscal.
As a first, the company is eyeing a digital first brand launch in the mass premium space. It is looking at bringing-in “one of its international brands” into India “by the end of this year”.
While there has been some pressure on the raw material front, Emami has been able to maintain margins while holding on to rural demand that is now witnessing a upswing based on good monsoons and increasing disposable income. On the other hand, urban recoveries are being witnessed following higher vaccinations and “normalisation” of life.
A conscious de-risking of portfolio and a push in the mass-premium categories have also helped Emami push more “digital first” offerings over the last one year. Going against the tide, the company had launched 40 new offerings – mostly digital first - last fiscal. A similar number is can be expected this year too.
Rural-to-urban sales is in the ratio of around 50:50 of its total turnover.
According to Harsha V Agarwal, Director, Emami, discretionary spending has witnessed a recovery in niche categories like men’s grooming, premium hair oils and so on. Health offerings including balms, which had grown around 30 per cent last year, continues to generate demand at “elevated levels” but is not “as high as it was during the pandemic year”.
Health offerings – including Zandu & Menthoplus balm – account for around 40 per cent of Emami’s portfolio (turnover).
“We are confident of a double digit growth this fiscal. And despite the occasional pressure on raw materials, we are looking at profitable growth to maintain margins. Discretionary items are witnessing revival in demand and health portfolio continues to grow. We did launch many digital first offerings last year, and, this year apart from new launches we will consolidate our position in the health and mass premium segments,” he told BusinessLine .
Price hikes
The company has seen price hikes in 5-10 per cent range across “select brands and select SKUs”. There have been no price change in LUP segments, priced between ₹1 and ₹10.
E-commerce currently accounts for 4-5 per cent of Emami’s topline and is expected to see a “significant increase in contribution” over “next two to three years”.
“We are planning a digital first brand (ecommerce only) soon. May be by the end of this year we will bring in one of our international brands in the mass premium segments,” Agarwal said.
With focus on niche brands like Brillaire and The Man Company — two D2C start-ups where it has strategic investments — Emami will “slow down focus” on its own male-grooming brand ‘He’.
“Right now its not the focus. If there are better opportunities we will expand its offerings scope. However, we not hiving-off the brand,” he added.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.