Mumbai: Marico Ltd, the maker of Saffola and Parachute oils, on Tuesday announced the appointment of its chief executive officer (CEO) Saugata Gupta as managing director (MD) in addition to his role as CEO. Gupta will be inducted into the company’s board of directors on 1 April.

Gupta takes on the managing director’s role from Harsh Mariwala, who will continue as chairman of the group. The changes are subject to approval by shareholders at the ensuing annual general meeting of the company, Marico said in a statement to BSE Ltd. Mariwala said Gupta’s appointment as MD was a planned progression and a part of the transition the company is going through. “My role, however, has changed from getting things done to influencing things," he added.

Gupta, who joined Marico in January 2004 as head of marketing and was elevated to chief executive’s role in 2007, spoke to Mint about his new role.

The sector is going through a tough time. Is this a good time for a management rejig?

It is a continuing transition. And not a rejig as such. And there is continuity in terms of my team. There is a little bit of softness in consumer demand in the country, but the long term consumer story is still intact. It is a question of consumer sentiment seeing a turnaround. Our imperative is that we continue to accelerate our growth and continue to innovate in terms of altering the products portfolio and adding more value added products. As far as the slowdown is concerned, we see it as a short term slowdown; we will continue to build capabilities and bring in talent.

When do you see consumer sentiment improving?

Election is an important milestone and it is very important to have a stable government. I think that is one of the sure points. We believe that in the second half of the year the sentiments will certainly perk up. I, however, do not see a sudden traction this year, it will be a slow process.

Do you see this as a good time to do another acquisition?

As far as Indian business is concerned, we have enough on our plate and we have invested enough in categories, which we believe have significant headroom for growth. Our core also has to grow. I think as an organization we need to build capabilities behind our organic growth. Especially in our international market, our growth has happened through inorganic means. But now we believe that in the India and international business, we want to develop capabilities for organic growth. Including the fact that there are possibilities to drive synergies and cross pollination to drive that growth. The basic growth has to happen through the organic route especially in the area of innovation.

However, there could be acquisition opportunities in the international market. To get a critical mass in certain places and markets where we are not present, acquisitions are an accelerator.

Is there room for price hikes?

There has been significant input cost increases, under these circumstances it is important that we find a sweet spot between volume growth and margins. In emerging markets what happens is that margins can be recovered in short to medium term, and what we need to protect is volume growth and market share. Our first choice is to protect volume growth and market share and look at margins in the short and medium term.

What is the company doing immediately to protect the volume growth that has been bad across the sector?

I think what we have done is that we have focused our spend on some of the core activities. So when there is a slowdown, we focus on our core. So that we get core volume growth. And I feel by far the worst is over in terms of volume growth. We will be able to experience better growth, but it is not going to be a fast recovery, unless there is some sentiment recovery after the elections.

Is there rationalization happening in the portfolio?

As you add new things, you have to stop doing a few things in life. We have in the past divested things. So obviously that is a natural process and, focus all the energy behind brands and products that have the highest potential for growth.

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