Generation next takes charge at Godrej

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Q: One of the other things that has really worked for you is your international acquisitions and you've done a spate of them. I know that the group is on the lookout for more. What are the plans as of now because you have had ambitions of entering markets like China, Nigeria, Indonesia and so on. Have you zeroed in on anything? Are you close to tying anything up at this point in time?

A: There are several things that we are looking at the moment. But as you know there are several categories that we have decided to focus on.

Q: You have done the personal grooming acquisitions already. So, will the next few acquisitions be in the personal grooming space?

A: We have made a few acquisitions there already, but clearly there are more opportunities there, which we are looking at.

Q: The international acquisitions that you've actually done, do you see for instance taking the Godrej brand name to South Africa in that sense?

A: Absolutely. We already have. We have several of our brands there already. Of course in the space where we are leaders which is ethic hair colour, we are the leaders we have over 80% share in ethnic hair colours in South Africa. So there it would be somewhat foolish to take our brand because the brand we have bought Inecto is the leader but in other spaces we are certainly taking the Godrej brand.

Q: As far as the acquisitions are concerned, those brands will remain intact minus the Godrej name because it doesn't really make sense in that sense?

A: As of now.

Q: But have you zeroed in on anything because it could be from USD 15 million to a billion, which is the sort of war chest that your father has been talking about?

A: This is one more. We have this growth ambition; another strategic lever is to have an effective M&A play. Some of the growth will come in organically; some of the growth will come inorganically.

Q: When do you hope to actually up your revenues for international businesses - currently at about what - about 25%?

A: It is at about 23-25%.

Q: So 50% by 2012 you think?

A: We hope so.

Q: And are you on target also as far as your revenues going upto about Rs 8,000 crore via 2012 from the FMCG business?

A: We hope so. Our FMCG businesses are doing great. We have grown phenomenally in the last year and I think our focus on brands, rural and modern trade and on supply chain synergies and things are paying off now.

Q: That's a big focus area for you isn't it - the Indian rural consumer. I believe there is several initiatives that are currently being test marketed at this point in time - the Nano refrigerator being just one of them. Take us through that? I believe it is a 6 litre fridge for Rs 2,500, is that right?

A: It is that. Actually where it comes from is all our consumer work and so that leads us to path breaking insights that lead to category refining innovation and this is just one example of that.

Q: So when are we actually going to see actually these commercially launched because we understand for instance the Nano fridge is being test marketed in Andhra Pradesh?

A: In Andhra Pradesh, very promising.

Q: What is the feedback?

A: The feedback is great. I think it is one of the great community and business sort of combined initiative.

Q: Will these profitable products for you?

A: We will make sure that they are. You rework them and make sure that they are.

Q: So how do you keep the costs down and at the same time be able to sell them at aggressive prices like Rs 2,500?

A: Innovation is not just about products, about delivery, it is a whole system. You find the India way of delivering what this consumer wants and you do it. It might be a little bit of trial and error and iteration, but we will do it.

Q: Something else that has been often spoken about is and your father spoken about quite a bit is exiting non core business- what is the plan because I understand that perhaps things like the tea business would see you moving out of that fairly quickly - is that right?

A: It is difficult to talk about specific businesses. But yes, we want to focus -- we are diversified already. The focus on areas has been clearly chalked out for us. There are really some areas we shouldn't be playing.

Q: You have identified those areas?

A: Yes. We have identified those and we will probably get out of some of them.

Q: How soon?

A: For instance Aadhar joint venture with the Future Group. We didn't really see much of a future for us going forward in that space on our own so we have identified a partner like the Future Group.

Q: You got a pest control as well?

A: That is what we would like to do in other businesses that we have identified as not core.

Q: Edible oils, tea what else can you think of? But you have a timeline now that you working with?

A:  Not necessarily exiting completely, like for instance in the pest businesses we exited. In the retail business we have a JV. So we will structure each opportunity or lack of opportunity the way it best pans out for our business.

Q: Some of the innovations that you actually brought about especially on TV was this reality show and stuff like that - are going to see a lot more?

A: Absolutely. That is very much a part of our master plan and our "Khelo Jeeto Jiyo" was sort of a lifestyle show, which was a great opportunity for us to showcase what we have to offer and infuse that with hopes and aspirations of all our consumers, who use or maybe, use some of our products and not all and really do not know about all our products.

Q: What about things like sponsoring the IPL which you did for both season 1 as well as season 2?

A: Season 1 & 2 we launched our new refreshed vibrant identify on the first IPL season. It really paid off. It allows us to showcase all our products together, to get the Godrej franchise feel about the whole thing. We seem to have got the best ROIM both season so we are very happy about that.

Q: About season 3? Is that a done deal?

A: I think so. I hope so.

Q: How is the royalty arrangement working?

A: We do not have one. It is sounding that we have been considering and toying it for a while but I think we have strong guidelines and we have a strong assurance process on how you use the Godrej bank now which I think is good enough.

Q: Have you taken a call now on whether you would want to go the royalty way because I know it has been toying.

A: We will decide, we have been toying with it but we have decided not to do that. The brand is owned by Godrej and each of our companies has a right.

Q: So you do not want to get into that?

A: No. not as of now.

Q: What do you see as the next level evolution as far as the brand strategy or the brand message?

A: There will be a lot brighter living. We will expand, this is a promise to all our stake holders. We will do a lot more on the employee front, consumer front, innovation front, really getting our brand out there in the face and showing people that we are young, we are new, we are vibrant, try us and trust us.