Is Patanjali all set to beat the likes of HUL?
Today’s business news from JustInReviews is related to the FMCG sector in India. In present times, primarily, two names come to our mind when we talk about this sector. They are Hindustan Unilever and Patanjali. Off late, Patanjali is catching up with the competition really fast. So much so that it is being asked whether Patanjali will beat the likes of HUL or not?
In the eye of this, here is a reality check as far as Patanjali vs Hindustan Unilever is concerned.
With Baba Ramdev-owned Patanjali Ayurved looking to cross HUL’s turnover towards the end of next year, the business rivalry for the Haridwar situated company just got intense, after a 4.1% ascent in income disclosed by HUL in the most recent quarter, increasing the gap significantly further. An interesting thing to know, Baba Ramdev-led Patanjali’s FY17 sales summed up to Rs 10,561 crore, a 1/3rd of that from HUL, which had achieved the Rs 34,487 crore figure, as reported.
Disclosing Patanjali’s ambitious plans, Baba Ramdev expressed at a recent event held by the All India Management Association, “Patanjali’s revenue will be more than HUL’s (Hindustan Unilever Ltd) in 2018-19. To support this growth, we’ll need to borrow over a period of time,” further stating that his ambition is to make the brand into the “largest packaged goods company in the world by 2020-21.”
While, Patanjali’s CEO Acharya Balkrishna expressed that the company does not have any IPO plans at this point of time.
While the gap between the two FMCG giants might appear large, the yoga guru appears confident by all accounts. To everyone’s surprise, Patanjali, claimed that it’s into partnership with e-commerce companies comprising Flipkart and Amazon to make its products available online, and hopes to twofold the revenue to around Rs 20,000 crore in the year ending 31 March.
One thing is pretty clear that the Patanjali vs Hindustan Unilever competition is going head to head. In under 10 years time, Patanjali, is currently the nation’s second-biggest FMCG company, with HUL being the first.
As the brand goes the digital way, Baba Ramdev stated that Patanjali crossed the Rs 10 crore mark in online deals in the month of December, and is focusing on more than Rs 1,000 crore this very year, with the help of e-commerce.
Over the past five years, the company’s turnover has seen an exponential rise from Rs 453 crore in FY12 to over Rs 10,500 crore in FY17. The brand had revealed an income of Rs 9,346 crore from its FMCG business in the year 2016-17. Most strikingly, the sales figures have seen a fast ascent in the course of last two years, i.e. from Rs 4,807 crore in FY16 to Rs 9,346 crore in the subsequent FY17. The fast rise has enabled the organization to go ahead of more established and experienced competitors such as Godrej, which initially launched a soap way back in 1918, and Nestle India, the local division of the Swiss giant that set up its first industrial facility in India in 1961. Total revenue comprising of sales from Divya Pharmacy, the Ayurveda medicine division, reached Rs 10,561 crore. This is a bit higher than ITC’s revenue at Rs 10,337 crore towards the end of FY17.
Acharya Balkrishna, the CEO of Patanjali Ayurved is known to have told ET Now that “Patanjali will grow at a faster pace this year as compared to last year. Hopeful that Patanjali will beat HUL’s turnover in next 3-4 years,”
All in all, it can be said that in the Patanjali vs Hindustan Unilever race to the top, the picture looks promising for brand Patanjali.
(Inputs from: Financialexpress.com)
JustInReviews is the place, where you can get to read business reviews as well.