Piggybacking on Ramdev, Patanjali has become a threat to MNCs

A decade ago, a group of farmers from a village near Haridwar came to Baba Ramdev. During general chit chat, they happened to mention that they were getting rid of their amla (gooseberry) trees because they made no money.

business Updated: Jan 18, 2016 08:20 IST
Sruthin Lal
Sruthin Lal
Hindustan Times
Baba Ramdev,Patanjali noodles,Patanjali Ayurvedic Ltd
Baba Ramdev and Patanjali Yogpeeth, Balkrishna launching Patanjali Atta Noodles, in New Delhi.(Vipin Kumar/Hindustan Times)

A decade ago, a group of farmers from a village near Haridwar came to Baba Ramdev. During general chit chat, they happened to mention that they were getting rid of their amla (gooseberry) trees because they made no money.

Ramdev told them not to. As if on a hunch, he said he would buy their amla. Patanjali Ayurvedic Ltd, the company Ramdev drives spiritually, without holding any equity or position in it, started producing and bottling amla juice. Ramdev would take it to his yoga camps.

It caught on. As they tried to emulate Ramdev’s contortions, his followers, numbering millions in the country and overseas, also drank the bitter juice and sang its praise.

One thing led to another. Patanjali started making other products: nutrition supplements, toothpaste, hair oil, shampoo, soap, cookies, and even noodles. It now earns an estimated `2,000 crore in annualised revenue and has a 150-acre food park in Padartha, a village near Haridwar. Two prominent brokerages — Credit Suisse and IIFL — think it presents a threat to entrenched FMCG companies. In fact, they think multinational giant Colgate Palmolive could bear the brunt of Patanjali’s rise.

“What makes Patanjali a credible threat is that it does not try to beat other FMCG companies at their game; it changes the game for them,” said IIFL. It expects Patanjali’s revenue to grow nearly 10 times in four years.

“People thought swadeshi meant poor-quality products. Many companies tried to compete with the MNCs but were not successful because of deception. We believe God has given us this mission,” says Acharya Balkrishna, Patanjali’s managing director, who owns 94% of the company’s equity.

Baba’s baby

Patanjali owes its fortunes to Ramdev. At his camps, on television channels like Aastha, and wherever else he could, he pushed Patanjali’s products, always on the plank of health benefits, often with a dash of swadeshi crusade.

Three years ago, he published a booklet titled Swabhiman Sankalp Patra, which invoked Mahatma Gandhi to say: “The main reason behind the wide-scale poverty in the country is ignoring the ‘Swadeshi’ concept in the area of economics.” Each Patanjali product has “Made in Bharat” written on it. “Here is an interesting link between economics and new-age spirituality,” says Sasheej Hegde, a sociologist at the University of Hyderabad. A Patanjali product guide says proudly: “Accepting swadeshi is our rashtra dharma.” It exhorts people to “shun” foreign products and “own” the swadeshi ones.

The sentiment is in your face wherever you go on Patanjali’s Haridwar campus. It has life-size statues of Charaka and Shushruta, ancient proponents of Ayurveda. Balkrishna’s office has pictures of Budhha and Krishna, a statue of Dhanwantari, the god of Ayurveda, and a national flag on his desk. Behind his chair is a framed portrait of Ramdev, to whom Balkrishna refers as “Maharaj” or “Swamiji”, meditating in Padmasana pose, with a halo behind him.

This, ironically, is the image Patanjali now seeks to grow out of.

Beyond the halo

“Designation-wise, he is no one in Patanjali — neither chairman, nor a shareholder, nor a director. But he is everything,” says Balkrishna.

But Patanjali is no more just Baba’s baby. It has tied up with Future Group and Reliance Industries to market its products in modern retail. It has built a network of 3,000 health centres across the country, which also sell its products. And it tried to fish in troubled waters by launching noodles when Maggi was pushed against the ropes by charges of being unhealthy.

Now, that is purely marketing savvy. There is nothing healthy, yogic, or swadeshi about noodles.

“Initially there were two opinions about introducing noodles. That it is bad for health and not a good food habit. Then we thought we should make an alternative. We did R&D. Swamiji himself ate a lot of noodles,” says Balkrishna.

The Patanjali Food and Herbal Park is heavily guarded, perhaps because of the clashes in May 2015 between the local truck drivers and the employees of the food park, in which a driver died. An electric car takes visitors to each production facility. The juice production centre’s interiors, with stainless steel walls, tanks and pipes visible through glass windows, look to be from a sci-fi movie. The only reminder of Ramdev’s intangible presence is the guards greeting one another with an “Om”.

The move away from Baba is reflected in Patanjali’s advertising, which is on the rise. It has hired DDB Mudra to create commercials that make it look contemporary. They feature celebrities like actress Hema Malini and wrestler Sushil Kumar. The new advertising features less and less of Ramdev and Balkrishna. “It is just that when other faces came up, our faces started showing up less,” says Balkrisha.

Next, Patanjali intends to be on the e-commerce bandwagon. “We already have a small presence,” says Balkrishna.We will wait and see if the image of a thin, saffron wearing man with flowing hair and beard finds much space on Flipkart and Snapdeal.

First Published: Jan 18, 2016 08:19 IST