Companies

RSH Global to ramp up capacity, launch own D2C platform

Meenakshi Verma Ambwani New Delhi | Updated on September 13, 2021

Sunil Agarwal, Chairman, RSH Global

To focus on topline growth

Homegrown FMCG company RSH Global is looking to ramp up production capacity with the construction of a new plant at Himachal Pradesh as it eyes gross revenues of ₹1,000 crore by the end of FY24. The company, known for its personal care brand ‘Joy’, is also looking to launch its own direct-to-consumer online platform expecting nearly 10 per cent of its total business to come from the online channel in the next two years.

Sunil Agarwal, Chairman, RSH Global said, the new facility at Baddi, Himachal Pradesh will be set up with an overall investment of ₹100 crore in phases. “We already have two units in Baddi. Due to the pandemic, our capacity expansion plans got delayed. But now, from January we will begin construction of a new facility and we hope it will become operational in the next one-and-half years by around 2023,” he said.

The company’s capacity expansion plans come at a point when it is looking to touch the ₹1,000-crore mark in gross revenues by FY24. Talking about recovery trends, he said, “The first five months of this financial year has been much better than the first five months of the previous fiscal year. Despite the pandemic, we closed the last financial year with a growth of about 5-7 per cent since we had one of the best winter seasons in terms of sales. We are now looking forward to a strong winter season even this year.”

The FMCG major hopes to clock growth of 25-30 per cent this financial year with an aim of earning gross revenues of about ₹650 crore. “In this financial year, we are focusing on topline growth with aggressive sales and distribution expansion strategies and hoping to see market share gains. Our bottomline growth will get impacted due to the inflationary pressures of high raw material costs,” Agarwal said.

Price hikes

The company has already announced two rounds of price hikes this year increasing product prices by about 8 per cent compared to last year. “We are seeing price increase of raw materials happening almost every other day. Its a challenging situation. We have been able to hike prices only by about 8 per cent while input costs have gone up by nearly 25 per cent. But we have now decided not to hike prices further atleast till December as we want to focus on volume growth,” he added.

For RSH Global, currently about 4 per cent of its total business comes from the e-commerce channel. “We are looking to increase the e-commerce channel’s share to 10 per cent of our overall business in the next two years. We are doing this through the launch of e-commerce exclusive products besides working on launching our own D2C platforms,” Agarwal added.

Published on September 13, 2021

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