Emami to selectively up prices by up to 2%

Emami to selectively up prices by up to 2%

Mumbai: Personal care products maker Emami Ltd said on Thursday it plans to selectively raise prices by up to 2% in categories impacted by a steep rise in input costs, a top official said.

“Prices will be increased in categories which are the most dependent on menthol as prices there have surged..Products such as Navratna Oil, Navratna Talc, Mentho Plus etc," Harsh Agarwal, director, told Reuters.

Indian fast-moving consumer good firms have been battling strong inflation in commodity-sensitive categories as prices of agri and crude related inputs surge.

Emami, which counts LLP (light liquid paraffin) and menthol as key raw materials, manufactures personal care brands such as ‘Fair and Handsome´, ‘Navratna Oil´, ‘Boroplus´ and ‘Sonachandi Chyawanprash ´.

Earlier in the day, Emami posted a 38% jump in net profit to 54.57crore. Net sales grew to 354 crore from 280 crore.

During the quarter, Emami’s profit from operations before interest and exceptional items fell 4% to 51.3 crore.

“In the coming years, we don’t certainly foresee prices of menthol coming down. For LLP, prices might come down tracking the global scenario but we don’t expect a fall in prices immediately," Agarwal said.

Expansion plans

The personal care products maker, which recently acquired a manufacturing facility in Egypt, is planning to put up a new unit in Bangladesh

“The Egypt facility is not operational yet because of the crisis there and we are going slow on the plans for that one. We have plans to invest 10.0 crore to set up a new plant in Bangladesh," Agarwal said.

The company plans an overall capital expenditure of 120 crore and plans to spend 350-400 crore on advertising and promotion in FY12.

“We are planning some brand extensions this year and are focussing more on the healhcare category," Agarwal said.

The company, which is also focusing on Africa and is exploring acquisition opportunities there, saw its international operations grow 33% to 66 crore during the quarter.

“We expect our international operations to rise to 35-40% in this fiscal year from 13% in FY11," Agarwal said.

Shares of the company ended up 0.98% at 428.2 per share in a firm Mumbai market.