Godrej Consumer eyes double-digit growth in FY22, expansion across sections

FMCG major Godrej Consumer Products Ltd (GCPL) is looking at clocking a double-digit growth in the current fiscal with expansion across segments, according to a company official.

The Godrej group firm has taken multiple initiatives to tap the potential of the new age channels such as e-commerce along with chemist and pharmacy stores that have emerged as important touchpoints for the customer buying FMCG products, after the pandemic.

The company, which is focusing on becoming a fully comprehensive home and personal care company, is also expanding its reach in the rural areas, where it has added 30 per cent new stockists after the pandemic.

Like other companies, GCPL has also witnessed a spike in its sales through e-commerce channels and going ahead it now expects online sales to contribute around 10 per cent to its total sales in the next 2-3 years and is introducing several digital first brands, said GCPL CEO - India and SAARC Sunil Kataria.

GCPL, despite the second pandemic wave this fiscal, reported a good volume-led growth in the April-June quarter of this fiscal. Its consolidated net sales were up 23.87 per cent at Rs 2,862.83 crore.

"We have a pretty good part this year. Our first quarter was very strong," he said.

When asked about the growth outlook for GCPL, Kataria told PTI: "If the thing remains stable and a third wave does happen or if happens in a mild way, we would be empowering for a double-digit value growth this year (fiscal)."

"We expect the growth to be spread across categories. Personal wash and hygiene would continue to do well. We will have a prime focus on the household insecticides (HI) segment, he added.

The company, which has powerful brands such as Hit and Good Knight in the HI segment, expects a positive opportunity as in the post-covid world, health-related concerns would go up.

It has plans to launch some more new products in HI segment.

"Similarly discretionary categories, which had taken a beating last year due to pandemic, we are seeing them also rebounding reasonably well, Kataria added.

However, Katiyar also cautioned about the uncertainties over the pandemic and a probable third wave, which the experts are warning.

Meanwhile, Kataria also added that as the pandemic recedes, some rationalisation has also happened in the health and hygiene segment in which the Godrej group firm has done several additions by launching new products after Covid-19.

But there are some fundamental products of hygiene, which will continue to grow well. For example, hand washing is a habit and is going to stay. It spiked during covid wave and it is not going down to pre-Covid level. It will settle at a much higher level than pre-Covid, he said.

GCPL's products such as Godrej Protekt Magic hand wash continues to grow pretty well and Kataria expects it to continue to strengthen.

There are some fundamental products which are going to meet some very inherent consumer need as Protekt Magic hand wash and hand sanitisers would not come down, they would continue to drive growth in the future, he added.

GCPL is also working to tap the e-commerce channels, which now contribute around 5 per cent of the total sales of the company, as a major shift is happening towards online sales after the pandemic.

We have created e-commerce as a separate business vertical... We believe that e-commerce has the potential not only to serve its consumers but also has a huge possibility of creating many products, which can be digital-first, Kataria said adding "we are going to experiment a lot".

Over the target from e-commerce sales, he said: "In the next three years, the business has potential to grow between 8 to 10 per cent."

While talking about rural sales, Kataria said it has expanded the network of stockists by 30 per cent, where it has now 13,000 rural distributors.

"Similarly, we have also launched hygiene products, we have also created a separate network for pharmacy and chemists channels. There are channels to tap new segments," he said adding GCPL is having multiple initiatives.