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India 'holding up well' in recession, says Unilever

Published on Sat, Jun 13, 2009 at 13:58 | Source : CNBC-TV18

Updated at Mon, Jun 15, 2009 at 09:22

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India 'holding up well' in recession, says Unilever

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MS Banga, President, Unilever Foods Division said this was a very unusual recession because so many geographies were impacted simultaneously. "I must tell that a number of geographies are holding up quite well. For instance, India, if you look at the Indian market, India as an economy, it has a large domestic market. It is showing good gross domestic product (GDP) growth, 5-6% maybe slower than India has been doing historically. But it's downside is better than -3 or 4 (minus three or four)," he added.
He further said a global recovery in consumption could take about 12 months and he did not see any green shoots yet. "Unilever is focussing on volume growth without compromising profitability," he said.

Unilever, Banga said, would adopt more aggressive pricing strategy where needed, adding that he hoped to add three more brands to list of billion-euro brands in five years. "The research and development and value focus will drive brand expansion," he said. "Unilever is looking to restructure high cost manufacturing in Europe."

Banga also said that plenty of brand activity was expected at Hindustan Unilever .

Here is a verbatim transcript of the exclusive interview with Manvinder Singh Banga on CNBC-TV18. Also watch the accompanying video.

Q: Are you seeing any of those green shoots that economists across the world are talking about?

A: To be honest, no. I don't see a global recovery the way it is being called. I think it is far too early to call a global recovery from this recession. I see a lot of challenges ahead; I think people are mistaking a recovery of the financial markets with a recovery of basic economic consumption. Now having said that, the trends are different in different parts of the world and I have certainly seen that in the last several months as I have traveled around in different countries.

Q: Even if the trend line is not moving up has the deceleration sort of eased a little bit in the developed markets?

A: This is true. I think what has happened is the rate of decline is decelerating and that has possibly led to a change in the sentiment in the financial markets or it could also be a change in some of the bank results which has again given a fillip to the financial markets. I must tell you right now I do not claim to know or be a soothsayer for how the financial markets work. I am much more interested in the fundamental economy. I would say that when I think of the fundamental economy I do not see it this moment much change either for example in the US or in large parts of Europe. I think those markets are still facing some pretty big challenges. They have negative gross domestic product (GDP) growth. On the other hand, the situation in other parts of the world is different and in many cases better.

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