BW Confidential - Issue #15 - September/October 2013 - (Page 68)

Emerging markets Company profile: Marico Beauty focused Marico is boosting its beauty business through acquisitions and a move into new cosmetics segments by Mayu Saini I t has been a year of change for Marico, one of the leading players in India’s FMCG segment. The company, which reported sales of $851m for its fiscal year ending March 31, 2013, has pursued an aggressive acquisition strategy and expanded its portfolio into skincare, and deodorant, while developing its haircare offer. All this is part of a wider strategy that has pinpointed beauty and wellness as a key area of growth. The company, which was founded 23 years ago, is best known for its Parachute hair oil brand. Hair oil is still a big category in India, estimated to be worth $518m, and although more modern care and styling products from foreign brands have flooded the market in the past five years, the category is still going strong. s Parachute Hair Oil is a key brand for Marico and the company expanded the line into skincare in 2011 Acquisitions drive growth The company has added to its successful Parachute brand mainly through acquisitions. It purchased another hair oil brand called Nihar from Hindustan Unilever in 2006 and doubled that line’s sales to Rs5bn ($82.1m) in seven years. It also expanded the Parachute brand into the new area of skincare in 2011, and made a major push this year with the launch of Parachute Advansed Lotion. “Our entry into all these new categories has shown very good results,” Marico chairman and managing director Harsh Mariwala comments. Parachute Advansed Body Lotion now has a volume market share of 7% and has become the number-three player in the sector. Acquisitions that enable to the company to move into international markets have also been a key focus. In 2010, Marico bought hair-styling company Code10 from Colgate Palmolive, which furnished it with a position in the hair cream and gel segment in Malaysia—a market that is worth $44m. Meanwhile, this year, Marico purchased two brands from Reckitt Benckiser—Set Wet and Livon—bringing the company into a new space: hairstyling products and deodorant for the youth market. In February 2011, Marico also entered Vietnam by taking an 85% stake in the International Consumer Products Corporation (ICP). This brought the company brands such as X-Men, a leader in the male grooming market, and L’Ovite in the premium cosmetics segment. Another acquisition in 2010, made through Kaya Skin Clinics, a wholly owned subsidiary of 68 Marico, brought them Derma X brands from Singapore. Indeed, international operations have performed well, with exports reporting an 8% growth in sales to $186m—22% of the group’s total business. This was mostly due to growth in Bangladesh, the Middle East and North Africa, South Africa and Southeast Asia. The company’s international portfolio includes brands like Fiancée, Haircode, Camelia, Aromatic, Caivil, Hercules, BlackChic, Code 10 and Ingwe. Marico intends to improve profitability of its international business by better integrating its foreign and Indian operations. Unearthing new trends Marico’s acquisitions have been transformational for the company. “If you see the kind September-October 2013 - N°15 - BW Confidential

Table of Contents for the Digital Edition of BW Confidential - Issue #15 - September/October 2013

Cover
Comment
Contents
Update
Brand & retail news recap
Companies on the move
Take note Market facts, figures & trends
Best of BW Highlights from our e-publication
Launches The latest in fragrance, skincare & make-up
Interview Origins, Ojon & Darphin global president and gm Jane Lauder
Insight: Fragrance creation
Category overview
Industry views
Emerging markets
Consumer data
Role of the perfumer
Retail
Store strategy
Store concepts
Digital Beauty apps
Market watch: Chinese consumers
Overview
Shopping habits
Online sales
Radar A profile of six up-and-coming beauty brands
Travel retail: Inflight sales
Sector analysis
Channel innovations
Emerging markets Company profile: Marico
Packaging
Make-up analysis
Make-up innovations
Last word The Young Group’s Karen Young on industry trends and technology

BW Confidential - Issue #15 - September/October 2013