Financial Daily from THE HINDU group of publications
Wednesday, Jun 01, 2005
Financial Daily from THE HINDU group of publications Wednesday, Jun 01, 2005 |
|
|
|
|
|
Corporate
-
Restructuring Dabur may re-evaluate Odopic's relevance to product portfolio Sindhu J. Bhattacharya
New Delhi , May 31 BARELY a month after completing the Balsara acquisition, Dabur India Ltd (DIL) may restructure the portfolio of the acquired brands. While the company has not declared any specific intention to sell off any of the acquired brands just yet, its Chief Executive Officer, Mr Sunil Duggal, told an investors' conference recently, "Odopic could be a bit of a question mark, but at this point in time we are committed to going ahead. We may re-evaluate the options for this comparatively minor brand in the next few months." He said that Odopic is "a comparatively minor product, which has got strong franchise in the West, but not much elsewhere. So we have to take a call on that whether we would like to scale up the product, maintain it, or scale it down". In January this year, DIL had announced acquisition of the seven Balsara brands spanning oral and healthcare segments, saying that they were synergistic with the company's existing businesses and would propel DIL to faster growth in the Fast Moving Consumer Goods (FMCG) space. The acquired brands include toothpastes Babool, Promise and Meswak, besides homecare brands such as Odonil, Sanifresh, Odomos and Odopic. Company officials said that Odopic needs a raw material, which is a by-product during detergent manufacturing. "Detergent is not in our portfolio and we, therefore, do not have enough backward integration as far as Odopic is concerned." When contacted, the DIL's Vice-President (Sales), Mr S. Raghunandan, said, "Right now, we are evaluating the depth of each Balsara brand." And even while the company is evaluating its option on Odopic, Mr Duggal said DIL plans to invest "substantially" behind the other three homecare brands, Odomos, Odonil, and Sanifresh. He said that an end-to-end integration of sales and distribution of all the acquired and the existing DIL brands was underway and this exercise will provide the company economies of scale. Also, Balsara's oral care portfolio is being merged with DIL's existing portfolio (comprising Dabur Red toothpaste and gel, Dabur Lal Dantmanjan, Dabur Herbal toothpaste and Binaca toothbrushes) under the Dabur brand umbrella. However, the four new homecare brands will continue to operate as standalone brands for the time being. As far as the oral care portfolio is concerned, DIL has already said it is scouting for opportunities in markets such as North America and Europe, in the private label business for toothpastes. Private label business will allow it to manufacture toothpastes for global retail chains and institutions at its facilities in India, with brand ownership of the final product lying with the buyer. DIL is keen to get into the private label business for toothpastes to use the synergies provided by the Balsara acquisition, since Balsara was also active in private labels. Also, such a venture needs little investment and is scalable. DIL already owns idle capacity used earlier by Balsara.
Article E-Mail :: Comment :: Syndication :: Printer Friendly Page
|
Stories in this Section |
|
The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription Group Sites: The Hindu | Business Line | The Sportstar | Frontline | The Hindu eBooks | The Hindu Images | Home |
Copyright © 2005, The
Hindu Business Line. Republication or redissemination of the contents of
this screen are expressly prohibited without the written consent of
The Hindu Business Line
|