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Godrej shops overseas to colour up hair care
GCPL, the Rs 1,400 crore consumer goods company, is on a hunt in international markets to acquire brands that could further its aggressive toilet goods business.
Godrej Consumer Products Limited (GCPL), the Rs 1,400 crore consumer goods company, is on a hunt in international markets to acquire brands that could further its aggressive toilet goods business.
The company, which already owns a string of overseas brands, including Rapidol, Keyline and Kinky, is looking for brands in the hair care business, chairman Adi Godrej told Hindustan Times.
“We are in talks with owners about buying out some foreign brands. We want to strengthen our position in hair care,” Godrej said.
Three of GCPL’s international brands have presence in the hair care and colourant segments, which together are seeing a recessionary trend and are yet to turn profitable, said a research report by brokerage IDFC- SSKI.
GCPL’s domestic hair colourant sales grew by 20 per cent to Rs. 69.3 crore from Rs. 57.8 crore during the three months ending March 2009. GCPL currently holds about 34 per cent in the domestic hair colour segment, down from about 40 per cent five years back.
Despite being a cash-rich company, GCPL has walked out of negotiations with at least two Indian promoters of consumer goods brands as valuations quoted were too high.
“We feel that brand valuations in India are still high in the FMCG (fast moving consumer goods) sector,” said Godrej.
GCPL showed a standalone net profit growth of 49 per cent at Rs 55.5 crore compared to Rs 37.1 crore for the three months ending March 2009. Sales for the same period increased by 30 per cent to Rs. 275.5 crore from Rs. 211.5 crore last year.
GCPL’s consolidated profit, including earnings from subsidiaries, was up 44 per cent to Rs 58.7 crore from Rs. 40.8 crore last year. Sales were up 26 per cent to Rs 342.7 crore from Rs.271.8 crore last year.
