The Indian oral care industry is pegged to reach Rs 7,000 crore, a 75 per cent jump over the current market size, primarily because of increased awareness through advertising coupled with faster penetration of oral care products. The demand for toothbrush is set to witness a 150 per cent rise as more consumers will take to using branded toothbrushes. This, according to Nikhil Nanda, managing director, JHS Svendgaard Laboratories Ltd, will help his company corner 60-70 per cent of the 1,700-million-unit toothbrush market projected for 2012. Nanda shares the company's plans in a candid conversation with Ashish Sinha. Excerpts:
What is the current size of the oral care market in India and the consumption of toothpastes? Can you draw some comparison with China?
The size of oral care market in India is Rs 4,000 crore as against Rs 11,000 crore in China. Penetration of modern oral care products is low in India. The average per-capita consumption of toothpaste in India is very low at approximately 110 gms and many people in rural India still clean their teeth with traditional products like twigs of the neem tree, salt, ash, and other herbal items.
Also, just 7 per cent of the population here brushes twice a day as compared with 61 per cent in China. But I believe this situation will improve over the next five years.
What is your estimate of the current supply units of toothbrush in India and your projection for the next five years? In case of growth, what will be major reasons influenc-ing it?
At present, about 700 million units of toothbrush are being sold in India of which our share is about 40 per cent. I feel that as more consumers are opting to use the toothbrush as opposed to any other means of brushing, the projected demand for toothbrush units will grow to about 1,700 million units.
The main reasons for this growth will be increasing awareness and advertising campaigns coupled with the overall penetration of oral care products in the country.
What is your share in the market and what will be your sales turnover by 2012?
Of the 700 million units of toothbrush that are sold in the country, we manufacture about 250 million units. We supply to some of the leading oral care brands and retail chains within the country and abroad.
Because of confidentiality agreement, I cannot disclose the name of our clients. By 2012, our turnover based on full capacity utilisation will reach Rs 250 crore. A large part of our supply may go to these upcoming retail chains across the country.
What is the contribution from organised retail?
The growth of organised retail and the requirement of private label products by the retailers has spurred our sales. While sales through organised retail still form a very small percentage of overall sales, the growth through it is much higher today than that through traditional grocery outlets.
We also attribute our growth to our tax-free unit. We have production facilities (Unit I & II) at New Delhi and a 100 per cent export Oriented Unit at Noida Special Economic Zone (Unit III) in Uttar Pradesh.
