 "Jinesh Shah, MD, Arihant Innochem")
Arihant Innochem Pvt Ltd, one of the leading importers & distributors of high-quality specialty chemicals, is eyeing to tap the fast-growing segments such as parenteral pharmaceuticals, dermatological products, processed foods & beverages, nutraceuticals, etc for driving business as the company chalks out the next-phase of its growth trajectory. The company, which started off asa trading firmin 1989 (then known as Arihant Trading Co), has today evolved into a distributor of leading global specialty chemical brands for industries such as pharmaceuticals, personal care, textiles, leather processing, etc.
The evolution
While initially the company focused on trading textile chemicals, it ventured into pharma industry by importing excipients (substances used in the preparation of medication alongside the active pharmaceutical ingredients or APIs) for the domestic manufacturers.
In 1996, the company received its first distributorship for Carbopol polymers from B F Goodrich Co, a company later acquired by Lubrizol. Since Carbopol, a family of polymers that are used as thickeners, suspending agents and stabilisers, is used in cosmetics (in addition to pharmaceuticals), the company forayed into personal care segment.“This was a stepping stone for our distributorship business. After this, we were appointed distributor by number of overseas companies for their products in India. This also marked our foray into personal care segment,” opines Jinesh Shah, managing director, Arihant Innochem Pvt Ltd.The company currently sources ingredients from over 22 leading speciality chemical producers, namely, Lubrizol, Shin-Etsu Chemical, Nichirin/Gotoku Chemical Industries, Nippon Soda, Pharmatrans, etc for the Indian market.
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It was only in 2014 that Arihant Trading Co rechristened itself as Arihant Innochem Pvt Ltd to reflect the transformation in the company’s business portfolio. It also established application lab in Mumbai which provides technical formulation support for personal care products. “Today, Arihant is not just a trading company; it is also a distributor and gives technical supports to its customers.We develop concept and prototype for new personal care formulations in our lab for customers using specialty ingredients,” points out Shah.
The company mainly caters to pharmaceuticals and personal care industries with imported specialty chemicals, which offer unique features to the end-products. In future, the company is also eyeing sunrise industries such as food processing, nutraceuticals, etc to expand its product portfolio. It already supplies sweetener to food industry. Shah informs, “In terms of regulatory and ingredients requirements, there is lot of similarity between pharmaceutical and nutraceutical industries. Hence, we are keen to explore the business potential in nutraceuticals as we would like to leverage upon our relationship with existing pharma customers.”
Parenterals: High potential market for excipient
Importance of specialty excipients, which are key ingredients in any pharmaceutical formulations, has increased multifold in the last few years. “The excipients market is growing at a robust rate as the demand for different formulations and drug delivery systems is increasing to fulfil the unmet requirements of consumers,” points out Shah.
Trends in pharmaceutical output by dosage formulation is having a strong influence on requirements of excipients. Demand for parenteral preparations has been witnessing a steady rise in the last few years, supporting demand for suspension agents and preservatives. Thus, Arihant believes excipients for use in parenteral formulations offer good business opportunity as output of these formulations is expected to rise at a healthy pace going forward. Shah explains, “Right now we support oral, oral care and tropical formulations segment with our excipients. We see parenteral formulations as a high-potential market and we are already scouting for overseas companies (suppliers) to import excipients for Indian pharmaceutical manufacturers in this segment.”
Personal care segment: The growth driver
At present, pharmaceutical industry is the lead business generator for Arihant, followed by the personal care segment. But, the company believes that this will change as personal care products witness robust demand compared to steady growth in pharmaceuticals industry.
“In the next five years, I see a lot of things happening in the personal care segment. With people becoming more conscious about their looks & health and rise in purchasing power, demand for personal care products will witness manifold increase,” informs Shah.
In personal care segment, except for large giants like Unilever, Loreal, Godrej, Dabur, Emami, etc, the small and medium scale cosmetic manufacturers lack the research capabilities for rolling out new products. It is here that Arihant’s application lab fills the gap for these manufacturers by offering technical support for developing new product. Shah explains, “Though formulation data is available from the principals (suppliers from whom Arihant imports ingredients), we develop formulations or product concepts to meet the specific needs of Indian consumers and market.We help personal care product manufacturers by formulating new prototypes as per their needs and providing support for other market development activities.”
Besides personal care products, Arihant is also focusing on derma products to provide technical support from its application lab.
Treading the trend
There are lots of technical details about imported specialty chemicals that need to be properly communicated to the customers.Hence, Arihant directly supplies to end-users. “This approach has been appreciated by our principals as we take the complete ownership of their products once they enter into India. It has also helped us gain trust of our customers since they are sure about the quality of the products,” says Shah.
Except for one, none of the principals of the company have presence in India, and hence, they work closely with Arihant to expand their businesses in the country. In the last few years, these suppliers are showing increase amount of interest in India, one of the fastest growing economies of the world with second largest population.
For example, for pharma ingredients suppliers, India is very important market as the country has become a pharmaceutical manufacturing hub of the world. Shah opines, “In the past, some of the suppliers (principals) never used to send their representatives to India. However, now they make frequent tour to the country to give technical training, sales support, etc. This shows the growing interest among these principals in Indian market.”
Going forward, Arihant intends to widen its customer reach to new areas such as nutraceuticals, parenteral, derma, etc by increasing its product portfolio. Also in the pipeline is the capability enhancement of its application labs to emerge as all-in-one solution provider forthe end-user industries.
Outlining his growth strategy for the company, Shah elaborates, “We intend to expand our service offering to the pharma industry by providing lab support for excipients. Besides, we will add parenteral excipients and food ingredients (especially for nutraceuticals segment) in our product basket in near future. While our short-term plan is to keep customers satisfied,in the long run,we want to become one-stop-shopsolution provider for our customers.”
