In 2011, a cluttered deodorant market seemed to be running out of innovation. Then Fogg was launched. The "no gas, no wastage" positioning by the Ahmedabad-based Vini Cosmetics took on Hindustan Unilever's Axe, ITC's Engage and JK Helene Curtis' (a Raymond Group company) Park Avenue.
"There were a hundred products in the market. I would have launched the hundred and first. I needed to differentiate," Darshan Patel, who owns and runs the personal care company, says about the positioning that helped Vini Cosmetics reach a turnover of Rs 511 crore in 2014-15.
Patel is one of three brothers who were promoters of the Gujarat-based personal care major Paras Pharma that was sold to Reckitt Benckiser in 2010. Now a market leader in the Rs 2,300-crore deodorant market, Fogg, according to Patel, has an 18.5 per cent market share, more than than those of Axe, Engage and Park Avenue.
There are 950 deodorant brands in the country. Fogg was a category creator, something Darshan Patel is good at. People who have worked with him say he is obsessive about creating brands and product categories. Vini Cosmetics' Delicca powder face wash is another innovation. After selling his 24 per cent stake in Paras for $43 million in 2006, Darshan Patel floated Vini Cosmetics in 2010 with a capital of Rs 74 crore.
Piyush Sinha, faculty member at the Indian Institute of Management, Ahmedabad, says, "Some teams have that X-factor. They are mavericks who can see beyond the obvious, sense what others cannot sense. The Paras team was one such. All three brothers brought something to the table, and the combination clicked."
The Patel brothers, Girish, Darshan and Devendra, joined their father's company Paras Pharma around 1985. Naranbhai had floated the company in 1983 and by 1985, had a turnover of Rs 40 lakh. The next decade was spent in creating Moov, Krack, and D'Cold, brands that fetched Paras Pharma a price of eight times its turnover in 2010.
In February 2012 Marico acquired Paras Pharma's personal care portfolio from Reckitt Benckiser for Rs 600 crore. This included Setwet, Livon and Zatak. Health care brands Moov, Krack and D'Cold remained with Reckitt Benckiser.
The brands have endured. This was what Girish Patel had in mind when he chose Reckitt Benckiser over Emami. "I wanted an organisation that would make the brands global," he had told Business Standard at the time of the sale.
People who have monitored developments closely say differences among the brothers over running the company led to Darshan and Devendra selling their stakes in Paras Pharma one after the other between 2006 and 2008 to private equity firm Actis. Devendra Patel promoted Adjavis Ventures, which owns the fragrance brand Layer'r. Girish Patel has not taken up an executive role in any other company. He has turned investor and mentor.
"I am on my way to retirement. I don't think any youngster will be interested in my story now," he says. Girish Patel bought back Actis' 82 per cent stake in Sterling Hospitals, a venture created by him in the early 2000s, for an undisclosed sum in December 2013. His son now manages the leading hospital chain in Gujarat.
One of his Girish Patel's close associates says, "It is very interesting to see how entrepreneurs think. He built brands like Moov, Krack, Livon and then all of a sudden put his hand into this project and made Sterling one of the most sought-after hospitals in the city. He can get into any other sector, irrespective of whether he has experience."
But Girish Patel is sure he will not get back to personal care. "I am a plain investor. I mentor health care start-ups," he says. He has plans for building an integrated township over 170 acres at Sanand, at a stone's throw from the Tata Motors and Ford India plants. Sanand, Girish Patel feels, has the potential to develop into the next Gurgaon, and an integrated township could just click like his other ventures.
Devendra Patel, who has his office in the same building in a posh locality in west Ahmedabad, is trying his hand at personal care, and has taken on his brother Darshan with his fragrance brand. The sales and distribution head in Paras Pharma, Devendra Patel knows the personal care business well. Not known as either a marketing or a financial wizard, he chooses to play safe with his brands.
Despite being endorsed by film actor Ileana D'Cruz, Devendra Patel's Layer'r is yet to scale the heights Fogg has reached. Nitin Karkare, chief operating officer of advertising agency FCB Ulka, feels celebrity endorsements can at best be a short-term strategy. "It is a steroid shot for brand visibility. But eventually the product itself has to work," he says. Devendra Patel could not be contacted for this report. He has roped in a team of people from Paras Pharma as well as personal care companies like Emami, and is raring to go.
With such entrepreneurial history, will the brothers come together to create magic again? That looks unlikely. "There are no cross-holdings. We have parted ways, and are each looking after our respective businesses," says Darshan Patel. For now, with Fogg, Layer'r and Sterling Hospitals each carving their own niche, consumers do not seem to be complaining.
| MILESTONES OVER THE YEARS |
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* New CEO for Paras. Actis brings in S Raghunandan
* Reckitt Benckiser buys Paras Pharmaceuticals for Rs 3,260 cr
* Darshan floats Vini Cosmetics
* Girish buys back Actis' stake in Sterling Hospitals
