Wednesday, April 27, 2016

An Indian yoga guru wants to sell $1.5 billion of soaps, shampoos and ghee this year

An Indian yoga guru wants to sell $1.5 billion of soaps, shampoos and ghee this year


Baba Ramdev-Patanjali-India© Provided by Quartz Baba Ramdev-Patanjali-India
Yoga guru-turned-business maverick Ramdev is flexing his muscles to grab a bigger piece of India’s Rs 3.2 trillion fast moving consumer goods pie.
In recent projections, the Rs5,000-crore Patanjali Ayurved has sought to double its revenue to cross Rs10,000 crore (or $1.5 billion) by March 2017. The company sells Ayurvedic or herbal versions of soaps, shampoos, ghee, and face-wash.
“We will invest Rs 1,000 crore to set up five to six processing units in various parts of the country. Besides, we will invest Rs150 crore in research & development,” Ramdev said on April 26. “We are looking at doubling our turnover to Rs10,000 crore in the current fiscal.”
The yoga exponent, who first burst forth on television screens across India in the early 2000s, showcasing quick ways to shed fat and improve immunity, is a household name in India. Patanjali Ayurvedic products were launched in 2007.
Popularity of the products has since risen.
Over the past three years, Patanjali has gained clout through word-of-mouth publicity and advertisement blitzkriegs on prime time TV, kindling Indian consumers’ love for indigenous products.
“Patanjali’s differentiators lie in consumer trust in Ayurveda and in group founder—yoga guru Ramdev, its inherent product quality and lower product prices,” suggests an April 2016 report by brokerage firm Religare Securities.
His company’s products, marketed as chemical-free and cheaper, directly compete with brands of large multi-nationals such as Hindustan Unilever, toothpaste-maker Colgate, besides domestic majors like Dabur and Emami.
Despite the brand’s claims, Patanjali’s products have been under the scanner for misleading consumers. Media reports suggest that products claimed to be manufactured by Patanjali were actually being manufactured by external vendors. Ramdev has dismissed such allegations as “politically motivated.”
If past numbers are anything to go by, the company doubled its revenue from Rs 2,006 crore for the year ending March 31 2015, to Rs 5,000 crore for the year ended March 31, 2016. According to a January 22 report by financial services firm India Infoline Ltd (IIFL), Patanjali’s revenues will further swell to Rs20,000 crore by 2020.
The company plans to launch a beauty-care range and kids’ wellness products. Development of an online sales channel is also a work in progress. The company will invest hundreds of crores of rupees on large food-parks that will help it scale procurement of raw materials such as essential herbs.
While the numbers and growth projection alreadyseem overwhelming, the guru apparently has more tricks up his sleeve.
“This,” he told reporters in New Delhi, “is just the beginning.”
Patanjali is creating a new market for itself: Kishore Biyani

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© Moneycontrol.com Patanjali is creating a new market for itself: Kishore Biyani
Last year Baba Ramdev's Patanjali signed up with Kishore Biyani's Future Group to make its products available in Big Bazaar outlets in the country. Since then Biyani, the man who has come to signify Khareedo Bejo, has been upbeat about the tie-up.

Patanjali has had a good beginning, he admits, adding that it has kept itself busy with new product launches like energy bars. Patanjali isn't gaining new market share so much as creating a niche for itself, believes Biyani. Three product categories of Patanjal's -- toothpaste, hair oil and ghee -- are doing well, and Biyani, for the time being, will focus on these.
The first two weeks of April have been good for the retail space, but Biyani has no guarantees to give about what it would look like in future, given the volatility of the market.
Speaking to CNBC-TV18, he said he doesn't believe the likes of Flipkart will give a good run for his money. There has been no threat from the e-commerce space. 

"In the US about 90 percent is still physical retail. I don’t think it will change over the next 10-20 years."
Biyani of hopeful of seeing a 40-50 percent growth in Future Consumer Enterprise in the next three years. A near-term target for the company would be about Rs 3500-4000 crore in revenues, he said.

Patanjali to invest Rs 1,150 crore in FY17, eyes doubling revenue

© image
Patanjali Ayurved, the FMCG venture promoted by yoga guru Ramdev, will invest over Rs 1,150 crore in the current fiscal to set up six processing units and one R&D center as it chases a turnover of Rs 10,000 crore this year.
"We will invest Rs 1,000 crore to set up 5-6 processing units in various parts of the country. Apart from this, we will invest Rs 150 crore in research and development (R&D). We are looking at doubling our turnover to Rs 10,000 crore in the current fiscal," Ramdev told PTI.
These units will come up in Assam, Madhya Pradesh, Uttar Pradesh, Maharashtra, Haryana and Uttar Pradesh.
"We are looking at setting up units in drought-hit areas such as Vidharbh in Maharashtra and Bundelkhand region in Uttar Pradesh and Madhya Pradesh. At least four of these units will become operational by the end of this fiscal," Patanjali Ayurved Managing Director Acharaya Balkrishnan said.
Patanjali Ayurved, which reported a turnover of Rs 5,000 crore in the last fiscal, is also looking at entering the highly competitive dairy segment this year.
"To reach our growth target, we will venture into new categories such as dairy, animal feed and khadi garments for yoga. We will enter dairy segment this year with the launch of milk, cheese, butter milk and paneer," Ramdev said.
When asked about the source of funds, he said: "Banks are more than willing to give loans to us. We have no shortage of funds to expand. We are a debt-free company."
The company is also working towards increasing its exports and enhance online presence.
"We are getting five crore internet searches every month. Our online sales will increase further as we expand," Ramdev said.
Besides, Haridwar-based firm has created four verticals -- Home Care, Natural Cosmetics and Health Care, Natural Food and Beverages and Health Drink -- as a strategy to expand and consolidate distribution network.
It has a network of over 4,000 distributors, 10,000 stores and 100 Patanjali mega marts pan India.
He further added Patanjali would spend around Rs 500 crore on cow protection and research center and setting up world class universities for vaidik education.
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