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Founding family puts Super Vasmol brand of hair colours on the block


Leading personal care companies Godrej Consumer Products Ltd., Marico, Emami, Dabur and Hindustan Unilever Ltd. (HUL) have reportedly been tapped as the founding family behind Super Vasmol hair colours has decided to sell its flagship brand for Rs. 1,500-1,800-crore. The transaction would give an exit to PremjiInvest that in 2015 invested Rs. 216-crore for around one-third stake of Hygienic Research Institute Pvt. Ltd., the company behind the 63-year old brand.

The monetisation exercise would also unlock value for the founders – the Chhabra family – who want to continue running the profitable company as well as Streax brands of hair colour products.

The flagship brand is likely to get demerged into a separate vehicle from a tax efficiency point of view. The deal is likely to entail a structure wherein some of the sale consideration will be used to pay off PremjiInvest.

The company was founded in 1950 by late SS Nishat. Over the years, it has built brands such as Super Vasmol 33, Keshkala, Vasmol Kali Mehendi, Super Vasmol Aamla Herbal Powder Hair Dyes, Vasmol Shaving Cream, Streax Hair Colour, Streax Pro and Streax Euro range of professional products, Yogiraj Thanda Tel, Florozone range of skincare products and Silkiss shampoo range.

Hygienic Research has five manufacturing plants in India, at Mumbai, Baddi and Guwahati. The company has a direct pan India retail distribution network of over 4 lakh outlets and aims to grow it by 25% on-year to reach Rs. 1,000-crore topline by 2020. In the salon or the professional channel, its products are currently sold in 25,000- 30,000 outlets directly and the company aims to grow them to about 50,000 in the next two years.

Trade analysts claim, Super Vasmol has a strong market share in east and south, and any company that has plans to deepen its presence in the two markets is likely to make a play. It also has retail presence in the hair-care segment in Bangladesh, where it competes with Marico, and Nepal, and its products are exported to about 20 countries.

Even in the past, players like Godrej, Marico and Dabur had made overtures to buy the company or its brands but till date the family had resisted. PremjiInvest was the first external investor.

The Indian hair care industry has evolved to a $3.3-bn, or about Rs. 23,600-crore, market, with growth rate of about 10%, according to a 2019 report by Nielsen.

GF Biochemicals to set up plant for biodegradable solvents in India or Europe

GF Biochemicals has teamed with Oman-based Towell Engineering Group for a joint venture (JV) to produce bio-based levulinic acid as well as bio-solvents and bio-plasticisers using the levulinic acid.

14 The JV, called Nxtlevvel Biochem, will use GF Biochemicals’ proprietary technology and will undertake both production and marketing based in the Netherlands, alongside GF Biochemicals. The partnership expects to open a plant in Europe or India that will produce 30,000-tpa of biodegradable solvents and plasticisers for cleaning, personal care, coatings, and agriculture markets.


ITC to ramp up new product rollouts amid slowdown

Diversified conglomerate, ITC Ltd., will accelerate the rollout of new FMCG products, bucking the industry trend amid consumption slowdown, aiming to drive sales and capture market share, said Executive Director Mr. B. Sumant.

ITC, a late entrant in the FMCG goods space, will launch 50-plus products in the next financial year and is on course to introduce 17 products during the current quarter, which is traditionally the slowest due to exams.

“Even during a slowdown, consumers look for variety and value-added attributes in products. Our primary focus is to drive demand and grow consumer franchise with the launch of innovative and differentiated products. The focus is on pursuing accelerated growth with profitability,” said Mr. Sumant, responsible for ITC’s FMCG business.

The company does not want to change its strategy during short-term disruptions. This is in contrast to most leading FMCG companies, which slow down their launches of new products due to poor consumption. ITC is bringing out low-priced units, such as Rs. 5 packs, in almost every category to both retain customers and get newer consumers who have cut down on their daily necessity spending. The company will debut its FMCG e-store in the next financial year and is scouting for investment in FMCG startups after picking up a stake in a vending machine company recently.

The company is targeting to become India’s largest FMCG company with sales of Rs. 1-lakh crore by 2030, an eightfold increase from Rs. 12,505-crore grossed in 2018-19.


Piramal Glass to invest Rs. 300-crore for Vadodara plant expansion

an investment of around Rs. 300-crore in their Jambusar plant near Vadodara, Gujarat.

The investment will go into adding a new greenfield furnace of 250 tonnes per day capacity with seven new manufacturing lines, the c o m p a n y ’ s Vice Chairman Mr. Vijay Shah said, adding that the focus going forward will be on exports. He added that the expansion will Piramal Glass Ltd., a leading specialist in design, production and decoration of premium glass packaging solutions for the cosmetics and perfumery, food & beverage and pharmaceutical industries, has announced

Mr. Vijay Shah, Vice Chairman, Piramal Glass at the groundbreaking ceremony

enable them to better serve their clients across Asia, Europe, Australia and the US where the company is already present.

Piramal Glass is among the top suppliers of glass bottles in the country. It grossed Rs. 2,500-crore in sales in FY19 and operates four manufacturing facilities in India, Sri Lanka and the US. As much as 40 per cent of its sale come from cosmetics & perfume market, 37 per cent from specialty spirits and the rest from the pharma space, Mr. Shah said. The Jambusar plant houses three furnaces with 23 manufacturing lines and produces 540 tonnes per day of glass, making it the largest specialty glass player in Asia.


Hindustan Unilever losing market share in skin-cleansing category

Hindustan Unilever Ltd. (HUL), the country’s biggest consumer goods firm, lost over 340 basis points in skin cleansing category over the past two years dragged by sharp decline in two of its largest brands – Lux and Lifebuoy – that together accounts for a quarter of the market.

HUL, the largest soaps maker, has seen its market share fall from 42.3% in the year ended December 2017 to 38.9% last calendar year, according to reports quoting Nielsen data. In the Rs. 22,000-crore soap segment that is roughly Rs. 800-crore eroded in a market which is increasingly getting competitive. HUL, which controlled more than half the soap market a decade ago, has seen consistent share loss in the segment but the latest decline has been the steepest.

HUL parent company, Unilever, at the Consumer Analyst Group of New York (CAGNY) conference in the US recently, acknowledged that penetration for the top two skin cleansing brands in India has been down. “As a result, we have seen declining sales and share losses in 2019. We have made specific interventions on price and product quality and we are becoming sharper on our brand messaging and, believe me, this will make all the difference,” Unilever’s Chief Financial Officer Mr. Graeme Pitkethly told investors.

For HUL, soaps business accounts for roughly a quarter of its annual sales.

GHCL board approves demerger of its inorganic chemicals and textiles business

GHCL, a diversified group with footprint in chemicals, textiles and consumer products, has announced that its board has approved the scheme of demerger of its inorganic chemicals and textiles businesses. The textile business will be demerged into a separate company. Both companies will be listed separately post approval from National Company Law Tribunal (NCLT).

Commenting on the development, Mr. R. S. Jalan, Managing Director,

16 GHCL said, “The demerger is intended to deliver various operational and strategic benefits to each business segment as separate listed entities such as focused growth, concentrated approach, business synergies and increased operational and customer focus. In addition, it will

address independent business opportunities with efficient capital allocation and attract different set of investors, strategic partners, lenders and other stakeholders, thus expected to result in enhanced value creation for stakeholders.”

In the chemicals segment, GHCL mainly manufactures soda ash (anhydrous sodium carbonate) that is a major raw material for detergents & glass industries and sodium bicarbonate (baking soda).

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