We will beat Hindustan Unilever’s turnover next fiscal: Baba Ramdev

Meenakshi Verma Ambwani /Shishir Sinha New Delhi | Updated on January 24, 2020

Baba Ramdev

Patanjali Ayurved will go for Ruchi Soya’s share sale in two years, says Ramdev


Patanjali Ayurved recently completed its first major acquisition — of Ruchi Soya — through the insolvency process, giving it access to key brands in the edible oil space, manufacturing plants as well as a strong distribution network.

Baba Ramdev remains unfazed by the prevailing economic slowdown, and reiterates his ambition to make Patanjali the largest FMCG company in the country, leveraging its swadeshi antecedents. Speaking to BusinessLine, he said the company aims to achieve a combined turnover of ₹25,000 crore this fiscal.

“We aim to become the largest FMCG company and we believe we will beat Hindustan Unilever in terms of turnover by next financial year,” he said. Excerpts:

What is your view on the current economic slowdown ?

I agree there is stress in the market. However, I believe every challenge is an opportunity. Consumers have been focussing more on saving and have reduced their spends. But this reduction in spends is happening more on luxury goods and not so much on essential items required for everyday use. After all , it’s not like the country’s agricultural produce has reduced or that consumers have stopped using essential items like soaps, shampoos, toothpaste, edible oils and ghee.

But in the past two years, Patanjali Ayurved’s revenues have been impacted adversely...

Our turnover has not reduced — that’s a myth being created in the market. We have not lost any market share in any segment, whether it’s our toothpaste brand Dant Kanti or our hair-care brand Kesh Kanti, or whether it’s in other categories such as honey, chywanprash or edible oils. These are rumours and misconceptions being spread about Patanjali by some MNCs and certain other entities who are against the success of swadeshi products in the country . If Patanjali Ayurved was so weak financially, would we have been able to do an acquisition worth ₹4,500 crore of Ruchi Soya?

Post acquisition what are the growth projections for the two entities?

Our ambition is to achieve a combined (including Patanjali, it subsidiaries and Ruchi Soya) turnover of ₹25,000 crore in the current financial year. We aim to become the largest FMCG company and we believe we will beat Hindustan Unilever in terms of turnover by next financial year. You will see Patanjali growing with a renewed zeal in the coming months.

Keeping in mind the demand of health-conscious consumers, we are expanding brand Nutrela to three new segments. We are introducing a premium edible oil called Nutrela Gold targeted at consumers who are health conscious and face issues of high cholesterol and blood pressure. We are also launching Nutrela Honey and Nutrela high-protein atta.

By when will you liquidate the promoter shareholding in Ruchi Soya in line with SEBI guidelines?

We will go for Ruchi Soya’s share sale in the next two years in accordance with the regulations. It will continue to be listed. We will be focussing on back-end integration between Patanjali Ayurved and Ruchi Soya and 100 per cent utilisation of manufacturing capacities. We will leverage on the strength of the brands to grab additional market share in various categories. We will increase the reach of Patanjali and Ruchi Soya products to about 50 crore consumers in the next five years.

Will you consider listing Patanajali or its subsidiaries or selling a stake in the future?

There is no plan for listing Patanjali Ayurved or sell any stake.

What can the government do in the upcoming Budget to boost the economy?

Focus needs to be on making the country self-reliant in all fields. We need to reduce our dependency on imports. Otherwise the country’ economy will never be able to grow in the right direction. This is required to be done in all the fields such as agricultural production and natural resources. In the next five years, most importantly, we can achieve self-reliance in the edible oil space by reducing palm oil imports. By doing that alone we can reduce forex spending by at least ₹10-lakh crore over the next five years. In other sectors, too, we can reduce forex spending in lakhs and crores.

Do you still hold that changes in the income-tax structure should happen? What is your take on the GST rate structure?

If a lesser rates-based income-tax structure is brought in then a lot of complications will reduce and it will foster economic transparency, reduce tax evasion and increase savings. But whenever a big change or reform in policies from the economic perspective is brought in, there are a lot of outcries. For instance, GST is such a good reform but initially it led to outcries as people had to change the way they were operating earlier and there were disruptions. I believe efforts to simplify the country’s taxation system will enable its economic growth. As far as GST is concerned, now the country has adopted it fully and people and companies have become habitual of the new framework.

Published on January 24, 2020

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