Companies

Savlon on track to be ITC’s first ₹1,000-crore personal care brand

Abhishek Law Kolkata | Updated on October 07, 2020

Sees four-fold growth, driven by rising health concerns

Diversified conglomerate ITC is expecting Savlon to be its first ₹1,000-crore personal care brand, in terms of consumer spends, by the end of this fiscal. Driven by rising health concerns during the pandemic and expansion of the product portfolio, the company has seen a four-fold growth for Savlon.

The brand had a consumer spend of ₹250 crore last year with offerings such as soaps, handwashes and antiseptic liquids. In FY20, Vivel was the company’s best-performing personal care brand with consumer spends to the tune of ₹500 crore.

Successful acquisition

According to Sameer Satpathy, Chief Executive, Personal Care Business, ITC, Savlon is one of the company’s most successful acquisitions. The brand witnessed a CAGR of 50 per cent and a 15-16 times growth after its trademark was acquired from Johnson & Johnson India in 2015.

Since the beginning of the Covid-induced lockdown, the Kolkata-based conglomerate has launched at least nine offerings under the brand (Savlon), covering categories such as disinfectant sprays for surface and clothes, surface and face wipes, hand-rubs, advance medicated soaps and body wash, and masks.

Further, brand expansion and product extensions are planned and these would be launched at an opportune time.

“Savlon is expected to be our first ₹1,000-crore brand, in terms of consumer spends, by FY-21. The brand has seen four times the growth this year led by new innovative offerings. Interestingly, we had acquired the brand when it was struggling in the market,” he said, adding that “by the end of this year, it will overtake Vivel in the personal care category.”

Production ramp-up

According to Satpathy, innovative offerings in the health and hygiene space have seen good traction with production capacities being ramped up by 3-5 times. At least 5-6 units of third-party facilities have been added for exclusive production.

The company is now mulling a dedicated personal care manufacturing facility in eastern India, details of which are being finalised.

Innovative offerings under Savlon, which were “first-to-market,” have had higher acceptability, leading to “better margins” for the company. From e-commerce and modern trade, these premium offerings —which have helped the comapny acquire new customers — are being expanded into general trade, he added.

Acquisitions

According to Satpathy, ITC is also eyeing new acquisitions in the health and hygiene space and there are “onand-off discussions” with interested parties. However, only when the company is “confident of such acquisitions being value-accretive” would it go ahead. The acquisition of a floor-cleaner and disinfectant brand, Nimyle, is a case study.

From being a regional brand with predominant presence in Kolkata, post acquisition two years ago, ITC is now taking the brand pan-India and also extending its product portfolio. The brand is expected to have consumer spends of ₹150-160 crore by the fiscal-end.

“Nimyle is four times the size since it was acquired a couple of years back. It has become the number one brand in the East in the floor cleaning segment. We rolled out NimWash (the fruit and vegetable cleaning offering) nationally, and Nimyle has been launched in the South.”

Published on October 07, 2020

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