Indian cosmetic and personal health-care major Emami Ltd has set its radar on the booming realty business. The group set up a subsidiary, Emami Realty Ltd, and has identified 10 projects comprising four IT parks, three shopping malls and residential complexes in Kolkata, Coimbatore and Hyderabad. The project involves the construction of over 50 lakh square feet.
“At present, almost 50 per cent of the company’s revenues come from the core business of cosmetics and personal health-care products. The real estate foray is a part of its strategies to bring in 70 per cent of the revenues from non-FMCG areas in the next few years,” a company spokesperson told Indiaretailing.
“Realty has been another potential business opportunity. With Emami’s resources, it can easily take these opportunities. Apart from using Emami’s liquid resources, it would also give the realty business an independent and separate focus since it would be a 100 per cent subsidiary of Emami Ltd. While aggressive growth in the FMCG business continues, realty would further enhance profitability and shareholder’s wealth,” said RS Agarwal, chairman, Emami, during the company’s annual general meeting.
In FMCG, the company’s fastest-moving brands have been Navaratna oil, Boroplus Antiseptic cream, Mentho Plus Balm, Fast Relief, Sona Chandi Chyawanprash, Boroplus Prickly Heat Powder, and Fair and Handsome. The company has extended its network to 2,600 distributors and 4 lakh retail outlets. For increasing exports in FMCG, the company has developed specific brands like Emita, Ayucare and a Gold range of products catering to specific markets and consumers.
“Collaboration with ITC e-Choupals and the postal department of Maharashtra is being explored for a wider distribution. Moreover, 8,000 Emami mobile traders and 400 Emami small village shops are conducting direct rural marketing in West Bengal, Chattisgarh, Madhya Pradesh, Andhra Pradesh, Orissa, Assam and Karnataka, covering 7.8 lakh households,” Agarwal informed.
The group has lined up investments of almost Rs 3,500 crore in the next 3-4 years for its paper, hospitals, retail, real estate and the more recent cement and bio-diesel business. It feels returns from industries like paper or cement comes much faster compared with FMCG. Thus, the segment will see investments of around Rs 125 crore this year.
However, it is also learnt that the group is scouting for acquisitions in the FMCG sector.
– Vishnu Rageev R, Bangalore Bureau