Toothpaste mart hots up as Colgate hikes tags

Colgate-Palmolive, market leader in toothpastes, has increased the price of its brand Colgate. The increase is in line with the expectations.

The price of a 200 g pack of Colgate has gone up from Rs 45 to Rs 47, retailers said. Company officials, however, were unavailable for comment.

Hindustan Lever (HLL), last month, had increased the price of Pepsodent from Rs 40 to Rs 42 for 175g. The price of Close-Up was also raised from Rs 42 to Rs 44 for 150g.

HLL had attributed the price revision to increasing input costs. However, while input costs have gone up substantially, the price hikes have only been marginal.

Analysts said the toothpaste market which has been stagnant for more than two years is now showing signs of revival both in terms of volume growth and maintenance of market share.

"Such price increases will not hurt volumes much since demand is ripe. Moreover, competition from lower-rung players has been receding mainly because the bigger players have also come out with economy brands and smaller pack sizes," said analyst Hemant Patel of Enam Securities.

Colgate-Palmolive currently leads the Rs 2,000 crore toothpaste market with a share in excess of 50 per cent, while HLL enjoys a 32 per cent share.

Apart from toothpastes, the FMCG sector has been seeing sporadic price increases in other products as well. HLL has recently increased the price of Fair & Lovely cream from Rs 26.50 to Rs 28 for a 200g pack.

Last month HLL increased prices of its shampoo brands Sunsilk and Clinic Plus. The 400 g pack of Sunsilk shampoo has become costlier by Rs 10 at Rs 135, while the 200 ml pack of Clinic Plus is costlier by Rs 5 at Rs 60.

Around February this year, HLL and Procter and Gamble began hiking prices of their detergent brands after a spate of price cuts in the previous year.

As recently as April, P&G brand Ariel Spring Clean went up from Rs 50 to Rs 53 for 500 g.

The price of Tide increased from Rs 23 to Rs 25 for 500 g. Multi-action Surf, now called Surf Excel Blue, is up from Rs 38 to Rs 40 for 500 g.