Reckitt & Colman of India (RCIL) has decided to refocus its local activities and also reposition brands such as Mortein and Lizol .The company aims to maintain the current growth rate of over 30 per cent, which would help the local operations contribute between 7-10.5 per cent of Reckitt & Colman's worldwide turnover in five years time.
Reckitt & Colman plc (R&C) holds 51 per cent equity stake in the Indian firm.
RCIl is also looking at acquisitions, joint ventures and marketing synergies to boost its brands and increase turnover. It's 1997 turnover was about Rs 380 crore. "We will go by acquisition, joint ventures and marketing synergies in household products, too, as we have done in the pharmaceutical business," said Michael Turrell, director, Reckitt & Colman plc, and group director, R&C plc.
Turrell also said that India is the regional base and would be the engine for company's future growth in Asia. The other country in focus for R&C is Brazil. He did not rule out India as an exporting base.
"South Asia contributes about 3.8 per cent to R&C's overall turnover. But if we keep up the present pace of growth, the figure may probably go up to between 7.5-10 per cent in the next five years," Turrell said.
The multinational has, as part of the recast, decided to refrain from investing in smaller brands such as Silvo and Brasso and is also looking for a buyer to sell off Robinson barley, a health food product.
RCIL's managing director and Reckitt & Colman plc's regional director(South Asia), Pranab Barua said, "We are scouting for a buyer for Robinson barley." RCIL's three-pronged business strategy is to focus on fast growing brands and have a global outlook by transferring practises and R&D.
Though Dettol is the largest selling brand in the antiseptic category, contributing about 34 per cent to the company's turnover (Rs 379.43 crore in 1997), RCIL will focus on pest control and household products like Mortein and Lizol. Admitting that Dettol is the third most well-known brand in India, Turrell said, "The local pest control market is growing faster than the antiseptic business and we want to focus there."
According to him, the global advertising and marketing strategy of Mortein has taught the firm to look at specific consumer needs. The demand in India, for instance, was for coils and Mortein introduced it for increased market penetration. Similarly, the Lizol portfolio will also be expanded by the year end. But, the company admitted that Robin Blue needed more aggressive marketing in the light of products such as Ujala.
"Robin Blue has grown, but we have also lost a bit of market share," Barua said, pointing out rectification measures would be taken soon to take on competition. RCIL's dependence on debts has been drastically reduced. The company ended the financial year December 1996 with just Rs 3 crore in commercial paper, raised at an affordable 9%. "We are now a debt-free company and have the capability to raise finances internally for medium range ventures," Barua concluded.
