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Water for money!

business Updated: Jul 17, 2010 02:51 IST
Sandeep Singh
Sandeep Singh
Hindustan Times
social responsibility

One man's social responsibility is another man's business opportunity. Liquid spells buisness

Film-maker Shekhar Kapur is getting ready to shoot for his next project Paani (Water) towards the end of this year, highlighting scarcity of water on the planet. But in many parts of India, the shortage of good, clean water is a fact that companies are already trying to cash in on.

The Rs 1,500-crore annual revenue water purification business in India, growing at around 20 per cent, is stepping up efforts with new devices that are breaking price barriers while evolving new technologies.

The game has shifted from high-end water purifiers aimed at affluent urban homes to the needs of rural India, taking a leaf from late management guru C.K. Prahalad's strategy that asked businesses to find a "Fortune at the bottom of the pyramid."

Given the shortage of power, the focus is on purifiers that run without electricity, do not need running water from pipes and operate only with low-cost refill cartridges.

While Hndustan Unilever and Tata Chemicals have already launched their devices (Pureit and Swach), Eureka Forbes on Friday unveiled its technology — Positive Charge Technology (PCT)— which needs no chemicals in the purification process.

Eureka Forbes has priced its 'Aquasure' at Rs 2,290 and its re-fill cartridge (PCT) at Rs 200.

While HUL ushered in the low-cost business, Tata Chemicals brought a revolution last December with 'Tata Swach' priced at just Rs 999. It has also introduced a new variant—'Tata Swach Smart Magic' for just Rs 499.

HUL followed suit and reduced the price of Pureit from an entry level of Rs 2,000 to Rs 1,000, but cut down on the capacity of the purifier. Both HUL and Tata Chemicals-made water purifiers operate without electricity and running water.

The Godrej group which already has a purifier for the urban market is also developing a device for rural markets. So you can be assured of more action in the hinterland with big brands vying for market share.

"I think the growth would be in excess of 20 per cent as the base is small and demand is high," said Amrit Pandurangi, executive director at consulting firm PricewaterhouseCoopers.

The Tatas have been clear about creating — not just entering — a new market.

"We are trying to create a new category and are trying to convert non-users into users," said R Gopalakrishnan, executive director, Tata Sons, had told Hindustan Times when Swach was launched.

In the hinterland, business houses are solving a real social problem.

"The government puts the access of clean drinking water at around 75 per cent in urban areas and 45 per cent in rural areas. There are many areas that barely have access to this supply for more that two to three hours," said an industry insider who did not wish to be named.

Millions still rely on traditional water filters with a steel body and two purifying "candles," but they too cost around Rs 1,200, which is in the same range as high-tech purifiers, say industry executives.

Having broken both price and technology barriers, companies known in the past for selling branded soap are clearly breaking new ground in hygiene.

(With inputs from Rachit Vats)