Patanjali Ayurved offers fresh hope to packaging firms

Purvita Chatterjee Mumbai | Updated on January 19, 2018 Published on January 26, 2016

Baba Ramdev

Hit by FMCG slowdown, Manjushree, Essel eye business from Ramdev’s company

Baba Ramdev’s Patanjali Ayurved may be the bane of competing FMCG companies but it is emerging as a boon for packing majors like Essel Propak, Manjushree Technopack and Dynaflex.

At a time when business from the FMCG category appears to have slowed down, these packaging companies are eyeing new players like Patanjali, which is consistently expanding its product portfolio and generating additional business for them.

“Topline growth has been challenging, with a slowdown in the FMCG category. But, Patanjali, with its 300-odd products, is expected to add 6-7 per cent to our topline growth.

This ayurveda firm is expected to emerge as one of our single largest clients going forward, in addition to FMCG majors like Dabur, HUL and Marico,’’ said Ashok Goel, Vice-Chairman and Managing Director, Essel Propak.

The company — the largest maker of laminated tubes, catering to oral care companies like Colgate and Hindustan Lever — will also be supplying to Patanjali’s toothpaste brands along with its non-oral care portfolio.

“We are hoping that domestic demand will pick up. Among all the FMCG companies, it is Patanjali which is most active today,’’ added Goel.

Bengaluru-based Manjushree Technopack, which is also eyeing business from the relative new FMCG firm, is putting up a plant in the Haridwar region, where Patanjali has a manufacturing base.

“We are pitching for Patanjali’s portfolio as we expect to get at least ₹10 crore of business in the first year from the brand, which should add 3-4 per cent to our topline,’’ said Vimal Kedia, the company’s Managing Director.

New arenas

The rigid packaging company, which makes jars and bottles for pharma and FMCG firms, is seeking packaging contracts from Patanjali for its largest selling products like honey and chyawanprash. “We have decided to set up our biggest manufacturing plant at Haridwar, which is going to be near Patanjali’s base.

“Today, it is one of the strongest FMCG brands and even its distribution has become robust since the Future Group started selling its products,’’ added Kedia.

Vadodara-based Dynaflex, the largest supplier of packaging materials to e-tailers, is also eyeing Patanjali’s e-commerce venture.

Gaurav Vora, Director, Dynaflex, said: “We are actively seeking the business of Patanjali’s e-commerce venture since future growth lies in ayurvedic FMCG products.’’

According to the latest report by IIFL Securities, the reason for Patanjali’s success is the unique business model of a single brand, a wide spread of categories, exclusive store network and close association of a personality (Baba Ramdev) with the brand.

Growing appeal

Moreover, there is growing appeal of ayurvedic/natural products — a way for consumers to express their ‘Indianness’ — along with low prices.

With the recent push for wider distribution and media support, Patanjali is expected to reach net sales of ₹20,000 crore by 2020.

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Published on January 26, 2016
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