Covid helps Reckitt Benckiser’s Dettol soaps win market share in India

Packaged consumer goods company Reckitt Benckiser’s (RB) Dettol soap bar became the country’s number one selling soap brand by value share, claimed the company, riding on the increased demand for personal hygiene products in the country

The maker of Dettol disinfectants, Harpic toilet cleaners and Veet hair removal cream, posted a “high single digit (revenue) growth” in India during the first half of the year, the company’s top management said as RB announced its half-yearly and second quarter results on Tuesday.

“It (India) did grow in high single digits (on a like-to-like basis) in this period. Dettol, a power brand in India, achieved the number one share in soaps in India for the first time,” Laxman Narasimhan, Chief Executive Officer, at the company said in a post earnings call with analysts on Tuesday.

In India, RB sells various products under Dettol such as surface disinfectants, soaps, antiseptic liquid, hand sanitisers, kitchen dish cleaning gels and body wash among others. Covid has helped accelerate frequency and adoption of cleaning products such as soaps and hand washes.

At over ₹20,000 crore, bar soaps remain the most dominant hygiene category in India.

Hindustan Unilever Ltd. leads the market with Lifebuoy and Lux soaps followed by Wipro Consumer Care’s Santoor and Godrej Consumer Products’ Godrej No. 1 brands which are among the top sellers in the market. HUL and Wipro go by market researcher Kantar’s volume share data on soaps.

Lifebuoy is among the country’s largest selling brand by volumes—driven by its mass-market positioning and reach in rural markets. RB’s Dettol, on the other hand, is priced at a premium.

In the first half, the Dettol brand grew strongly globally, up 62% compared to the same period in 2019, with growth in both developed and emerging markets, led by covid-19 demand fuelling greater product penetration and frequency of use; Dettol became the number one soap brand in India, the United Arab Emirates, Saudi Arabia and Malaysia, the company said in its earnings release.

“It boils down certainly to the fact that there are tailwinds that you get from covid in India but it also boils down to some execution improvements we are seeing in both the health segments as well as the hygiene segments. What we are seeing there is a focus on distribution, a focus on ensuring availability, which hasn’t been easy, given all the lockdowns in India at various places and at various points,” Narasimhan said.

However, gains made by RB could be short-term, said an analyst speaking to Mint on the condition of anonymity.

For the three months ended June 30, the company reported a 10.5% jump in like-to-like sales as global demand for personal and home cleaning products—Lizol, Dettol and Sagrotan—surged. India saw growth in May and June as lock-down eased, although the outlook on emerging markets remains uncertain, the company said.

The company continues to drive penetration that will help drive category building, especially in markets like India. “If you look at India, we have seen increase in points of distribution and the overall India business grew in high-single digits in this time,” he said.

Narasimhan said the company also actively focused on brand building. For instance, its Dettol India hand-wash challenge launched in April, on the now banned TikTok app, received in excess of 120 billion views.

Not just Dettol, the company also saw demand for its home cleaning brands Lizol and Harpic go up.

“So what we are doing there is not just a focus on financial results per say, in the short term, but also building the equity of the brand. And the Dettol brand equity is at one of its highest points. We are also heartened by the progress we are seeing on Lizol and Harpic in India and the continued scale up of that business,” he said.