Himadri Buch Moneycontrol News
Mumbai-based consumer goods company Godrej Consumer Products Ltd (GCPL) is contemplating a price hike in select categories, said Sunil Kataria, Chief Executive Officer- India & SAARC of the company.
"In some categories, there is definitely some inflationary trends that we have seen, whereas there is some deflation in some categories. We will play it more category wise in the next few quarters and make some selective choices in terms of prices," Kataria told Moneycontrol.
The hike in prices of some products may be due to rising raw material costs, as high crude oil prices, along with currency depreciation affecting overall margins for the company in the quarter ended December.
Most of the companies had indicated inflationary scenario going forward and they are confident of mitigating the pressure through calibrated price increases.
GCPL's products include soap, hair colourants, toiletries and liquid detergents. Its brands include Cinthol, Godrej Fair Glow, Godrej No.1 and Godrej Shikakai in soaps, Godrej Powder Hair Dye, Renew, ColourSoft, Rich Crème in hair colourants and Ezee liquid detergent.
Kataria didn't say which products could see a price hike.
Growth in soaps
On the question of competition in the soaps category, Kataria said that the soap segment has always been a competitive category despite 100 percent penetration. However, he believes there is enough scope for growth and the company’s focus will be to penetrate in to regional markets going forward.
In the soaps category, GCPL brands compete with Lux and Lifebuoy from Hindustan Unilever.
Speaking about their insecticide business, Kataria said the company will focus on bringing new products which are making the differentiation and grow the category.
The maker of Hit insecticides saw flat sales for the December quarter for its India household insecticides segment. The sales were hit due to deficient rainfall in the south.
Hair colour
Kataria said that GCPL that has been a pioneer in disrupting the hair colour category, will continue to grow strongly in this segment by upgrading the consumers.
"Our focus in the hair colour category will be to upgrade the consumers from bottom end of the category to formats like Crème. Hair colour also gives us headroom for penetration growth. So our task will be to get affordable accessible formats," said Kataria.
He also pointed out that a critical task for the company will be to create more differentiation and bring innovation in that category which will help them to capture a larger pie in the hair colour segment.
The Indian hair care industry has evolved to become Rs 23,600-crore, market with a growth rate of about 10 percent, according to a recent report by Nielsen.
In the hair colour category, GCPL products compete for market share with Black Rose, Super Vasmol and L’Oreal.
Godrej mostly controls the mass-end market, it has been upgrading its portfolio over the past few years. It was the first to launch a hair-colour crème in a sachet at a market disruptive price, forcing competitors to try and play catchup with me-too offerings.
GCPL owns 30 percent stake in Bhabani Blunt Hair Dressing, known for its B:blunt premier hair salon. Kataria said the company will remain invested in this business for a long term.
To broaden its, footprint, Kataria said the company will be shifting its entire product range to e-commerce.
"B:blunt is a niche business for us. It aims the premium segment and it’s a brand where we are invested in for long term. It has a huge amount of e-commerce focus so we will shift to the entire product range to e-commerce property," Kataria said.
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