Patanjali can become No 2-3 FMCG firm in 1-2 years: Biyani

Future Group on Friday announced its tie-up with Baba Ramdev’s Patanjali. As per the deal, Future will get exclusively right to sell Patanjali’s products in its outlets like Nilgiris, Food Bazaar, Food Hall and Big Bazaar.Kishore Bayani, Chief Executive Officer (CEO) of Future Group told CNBC-TV18 that the company’s aim is to offer superior quality products that fall in line with Patanjali’s vision. Biyani expects to do business of Rs 1,000 crore in coming two to three years with its latest tie-up. "If we have 35 crore people ending up in our stores (for Patanjali products), I believe there will be an addition of another one crore customers because of this," he said. Patanjali, as well, is looking to establish three to five food parks in coming time. The company might even look at tie-up with the Future Group for manufacturing food products. Bayani believes that Patanjali has the potential to become number two or three company in the fast moving consumer goods (GMCG) segment in next two to three years. Below is the transcript of Kishore Biyani’s interview with Prerna Baruah on CNBC-TV18.Q:How will this tie-up benifit Future Group?A: We personally believe that Patanjali has its own set of customers. They all need some environment in which a product is bought. We have our own customers who want to buy Patanjali products; they were not getting products earlier in all our stores. I think this relationship will ensure that every category, every product, every SKU of Patanjali is available in our store; customer gets a chance to buy that product and use that product. There will be a lot of sampling exercise, there will be a lot of product explanation being done in the store and I believe that will create an acceptance of that product in form of our consumer. Secondly, we also believe there will be a set of consumers who wanted to buy Patanjali and didn’t know where to buy from. So, they will be another additional customers. With this we believe we will be able to expand our business. Q: Talking about the customer base, now with partnership with the Patanjali Group how much of customer base will this add to Future Group? While this partnership will add to the distribution reach in terms of Patanjali but how much of customer base will be added? A: On all the research and work which we have done all around the country on the Baba Ramdev profile, on the Patanjali brand and the yoga lovers, we believe there are one crore customers who are waiting for something like this which can be added up to our set. If we have 35 crore people ending up in our stores, I believe there will be an addition of another one crore customers because of this. Q: In terms of revenues you did say that over the next few months or a year’s time, it will add to about Rs 1,000-1,500 crore in terms of its revenues so how will this boost in terms of your own revenues? A: We will start with Rs 40 crore kind of monthly number, going up to Rs 80 crore a month and then taking it up further. Q: You have your own food park in Bangalore and Patanjali also has its own food park in Haridwar, Baba Ramdev also said that going ahead it may look at tying up with Future Group to setup your own food parks and in terms of distribution, so, any timeline so far and any talk?A: We have just got into a relationship and that relationship is fructifying in many ways. Manufacturing is another relationship which we are exploring. We have our own dairy, rice mills, flour mills, spice mills and frozen lot of multiple product category units. We believe there is a chance to work together on this relationship also which we are currently exploring. Q: Talking about the price points, all Patanjali products is for the mass market segment largely so how will this go ahead because compared to products of P&G and Hindustan Unilever (HUL) how long will this take to reach to those levels in terms of the pricing? A: I think Patanjali already might be among the top five FMCG companies of the country and we believe they have a chance to become the number two or number three in the next one or two years. Can we help them to become the number two much earlier is something which we will be looking for. I don’t think there is much to comment on that. We believe they will be among the top three FMCG companies of the country.