Santoor reclaims No. 3 spot, says Wipro Consumer’s Agrawal2 min read . Updated: 18 Jan 2013, 11:31 PM IST
Vineet Agrawal speaks about Wipro Consumer regaining market share and the timeline of its demerger
Bangalore: Consumer products company Wipro Consumer Care and Lighting, a part of Azim Premji’s Wipro Ltd, reported a 17% jump in sales to 1,028 crore for the December quarter. In November, Wipro said it would separate its consumer unit from the information technology business. In an interview on Friday, Vineet Agrawal, president of Wipro Consumer, spoke about the market share gains of the company’s Santoor soap, which is back in the No. 3 spot it had lost to Reckitt Benckiser Plc’s Dettol brand. Agrawal also spoke about the expected timeline of the completion of the demerger. Edited excerpts:
What was growth driven by this quarter?
In our domestic business, Santoor continues to be No. 1 in the west and south. In December, we became No. 1 in Karnataka and Maharashtra, and No. 2 in Gujarat. In these states, we were either No. 2 or 3 earlier. We’re also increasing the Santoor portfolio. In Andhra (Pradesh), we’re test marketing our shampoo. In Karnataka, we test marketed our lotion. In commercial lighting, we’re going after LEDs, which are higher margin and which drove growth in that business. In furniture, we’re focusing on designer furniture. We’re estimated to be the No. 2 player in the country in furniture. In our international business, China (grew) 32% and the Middle East grew 32%, Indonesia 26%, and Vietnam 24%.
How did Santoor perform? What was its market share?
Broadly, the soap category grew 10-12%, while we grew 15%. We’ve been a lot more focused and are not spreading ourselves thin. We’re saying we’ll be dominant in the west and south, and go state by state and dominate them. We’re increasing our distribution, especially in the rural areas where we’re gaining higher shares. But this quarter, our urban share jumped dramatically. Our new packaging and advertising are performing. Our share was 8.8% (compared with 8.3% in the September quarter), Dettol had 7.8% (compared with 8.3% in the September quarter), Lux was 14.4% and Lifebuoy 14.4%. (Both Lux and Lifebuoy are owned by Hindustan Unilever Ltd.)
How has pricing held up?
The standard pack sizes (introduced by the government in November for certain product categories such as soaps and biscuits) have actually led to a slight price drop broadly. For example, if I was selling a 90g bar of Santoor soap for ₹ 21 earlier, now I’m selling 100gm for ₹ 21. So my price has actually dropped.
Is pricing likely to change then going forward?
I don’t think so. The general cost of commodities, including palm oil, is reasonably down. So we don’t expect prices to change.
Is the demerger on track?
It is reasonably on track. It depends on the court and whether they want any more clarifications. But it should be done within the next six months.
How are you preparing internally for the demerger?
For us, business continues as usual. What we will need are separate sales tax licences and registrations with the government, but that will happen after the demerger is completed. The offices remain the same—we’ll be based out of the same Sarjapur (Bangalore) office. We were paying rent for offices we shared with Wipro Ltd as part of good governance practices and we will continue to do that.