This story first appeared in DNA Money edition on Monday, May 20, 2013.
TTK Prestige, the maker of pressure cookers and kitchen appliances, is getting ready to enter India’s Rs 3,200-crore water purifier market where big names such as Aquaguard (Eureka Forbes), Pureit (Hindustan Unilver), Swach (Tata Chemicals) and Kent RO abound.
On Friday, a TTK official confirmed the development during an earnings call. “We will launch the water filter this fiscal.” No further details were divulged.
The TTK move comes amid industry estimates that the segment sales, riding compounded annual growth rate of 25%, will hit Rs 7,000 crore by 2015.
But TTK is facing testing times in the high-end kitchenware segment. Having tested the waters for more than one year, it has now decided not to push ahead with sales and distribution of World Kitchen’s brands “except Snapware” (which is range of spill-proof, nestable and airtight food storage containers made of plastic and glass).
T T Jagannathan, chairman of TTK Prestige, was earlier reported to be looking at Rs 50 crore in sales this year from the February 2012 partnership with the Illinois-based World Kitchen. The latter will now have to set up its own network to market and distribute its brands like Corelle, Corningware and Pyrex cutlery.
For the January-March quarter, TTK’s sales rose 22.3% on-year to Rs 289.46 crore. Operating income went up 32.5% to Rs 43.91 crore and net profit soared 42% to Rs 28.03 crore.
Growth in south India remained flat but rose 70% on-year in the rest of India (10% and 52% for the full fiscal respectively).
So, TTK has earmarked Rs 50 crore for capital expenditure this fiscal, while gross debt of Rs 115 crore is now being sought to be slashed to `60 crore by this fiscal end.
To de-risk, TTK is ramping up its presence in regions other than south India by appointing new distributors and setting up new accounts. This strategy has already helped boost activations 22.3% on-year during the fourth quarter. TTK is also stepping up advertising expenditure.
About future growth, the TTK official said, “Emphasis is being laid on our own brand retail stores focusing on non-south India markets. Currently, 65% of our stores are in south India and one-third elsewhere. That’s something we are planning to correct so that the proportion is in line with our turnover.”
Sunday, 26 May 2013
Sunday, 19 May 2013
At JWT, focus is on building long-term careers
This Q&A first appeared in DNA Money edition on Saturday, May 18, 2013.
Sapna Srivastava, chief talent officer, JWT APAC, speaks about how the agency sees the Portfolio Night 11 initiative acting as a catalyst for the agency’s soon-to-be-introduced JWT Honours programme that focuses on creating long-term careers in advertising. Edited excerpts:
What prompted JWT to associate with Portfolio Night?
There were two compelling reasons for us take it up. First, to provide the young/ raw students a platform to showcase what they have done and are capable of doing. Secondly, we saw it as a great opportunity to identify bright talent (from the 90 participants) and eventually look into the possibilities of making them a part of JWT. We have always been and want to be known as an agency that helps build careers and hosting an event like this serves that purpose well.
How does the Portfolio Night approach to identifying budding talent?
As an organisation JWT India does not go to campuses as we feel we may not get the best of the candidates as there are many companies vying for the same pool of talent. The difference between campus recruitment and what we are doing through Portfolio Night is that here we’ve got people who are interested in a career in advertising. And while they are participating in the global event, they are actually coming to JWT. So we know these people are serious about a career and not using it as a stepping stone to go elsewhere.
So campus recruitment is not for creative talent and is largely restricted to account management roles for which hiring is done from B-schools.
What is the approach for recruiting creative people then?
There are many colleges that produce really good graduates. However, a lot of candidates write to us about wanting to start their careers and we generally choose from these applications.
Having said that, this year we are proactively launching a programme called ‘JWT Honours’, wherein we will go to colleges and make presentations about careers in JWT.
We will pick about 12 interns in every city, they will come and train with us for 12 weeks and create a book of work which will be evaluated and the best of the lot will be hired.
With this we are creating a whole new platform to help youngsters build their careers and Portfolio Night will act as a catalyst to our JWT Honours initiative, which will focus on creating long-term careers in advertising.
Could you tell us about the profile of candidates who have registered for the Portfolio Night event?
Majority for them are freshers who are either studying or have just passed out of their creative colleges. I think what they are really looking forward to from the event is a feedback on the work they have done while studying. Getting an opportunity to present their book of work to the likes of Prasoon Joshi or Piyush Pandey and getting a comment on what they’ve done is a great thing to have at the beginning of one’s career.
Even if the comment is negative, the young minds will know the direction they have to move thereafter; and if their work is good they will be highly appreciated. In fact, this year Portfolio Night will select the best of the creative minds from across the cities where this event is being hosted and fly them to New York where an All Stars Portfolio Night will be held. So one of the students from the Mumbai event will also go for this event.
Sapna Srivastava, chief talent officer, JWT APAC, speaks about how the agency sees the Portfolio Night 11 initiative acting as a catalyst for the agency’s soon-to-be-introduced JWT Honours programme that focuses on creating long-term careers in advertising. Edited excerpts:
What prompted JWT to associate with Portfolio Night?
There were two compelling reasons for us take it up. First, to provide the young/ raw students a platform to showcase what they have done and are capable of doing. Secondly, we saw it as a great opportunity to identify bright talent (from the 90 participants) and eventually look into the possibilities of making them a part of JWT. We have always been and want to be known as an agency that helps build careers and hosting an event like this serves that purpose well.
How does the Portfolio Night approach to identifying budding talent?
As an organisation JWT India does not go to campuses as we feel we may not get the best of the candidates as there are many companies vying for the same pool of talent. The difference between campus recruitment and what we are doing through Portfolio Night is that here we’ve got people who are interested in a career in advertising. And while they are participating in the global event, they are actually coming to JWT. So we know these people are serious about a career and not using it as a stepping stone to go elsewhere.
So campus recruitment is not for creative talent and is largely restricted to account management roles for which hiring is done from B-schools.
What is the approach for recruiting creative people then?
There are many colleges that produce really good graduates. However, a lot of candidates write to us about wanting to start their careers and we generally choose from these applications.
Having said that, this year we are proactively launching a programme called ‘JWT Honours’, wherein we will go to colleges and make presentations about careers in JWT.
We will pick about 12 interns in every city, they will come and train with us for 12 weeks and create a book of work which will be evaluated and the best of the lot will be hired.
With this we are creating a whole new platform to help youngsters build their careers and Portfolio Night will act as a catalyst to our JWT Honours initiative, which will focus on creating long-term careers in advertising.
Could you tell us about the profile of candidates who have registered for the Portfolio Night event?
Majority for them are freshers who are either studying or have just passed out of their creative colleges. I think what they are really looking forward to from the event is a feedback on the work they have done while studying. Getting an opportunity to present their book of work to the likes of Prasoon Joshi or Piyush Pandey and getting a comment on what they’ve done is a great thing to have at the beginning of one’s career.
Even if the comment is negative, the young minds will know the direction they have to move thereafter; and if their work is good they will be highly appreciated. In fact, this year Portfolio Night will select the best of the creative minds from across the cities where this event is being hosted and fly them to New York where an All Stars Portfolio Night will be held. So one of the students from the Mumbai event will also go for this event.
Colvyn Harris, CEO, JWT South Asia
We look at it as a initiative towards building a sustainable industry and ensuring that JWT continues to be at the forefront of what we do, that's one element of looking at it from a company's stand point.
From a clients' perspective, we always say that client is at the centre and, their brands and business are our primary concern. And if that is our key focus area then we have to have great talent in the industry and our company. When we say, creativity is at the heart of everything we do, then talent has to deliver on that purpose. The Portfolio Night 11 is fairly interlinked and features perspective from the company, industry and client.
We have 30 jury members (creative heads) and they will be meeting 3 participants each so 90 was our cap. We want the jury to have an in-depth look at the works being presented by each of the candidates and not just flip through it. We looked at a combination of space and time and arrived at the 90 number. Registrations have thus been closed for this years Portfolio Night event and we are now gearing up to hold the event next week at our office premises.
With Portfolio Night, ad frat looks to connect with creative minds
This Q&A first appeared in DNA Money edition on Friday, May 17, 2013.
JWT India, a unit of WPP, the world’s largest advertising group, recently unveiled a theme ‘An Eye-Opener’ for Portfolio Night 11 to clear misconceptions aspirants have about the advertising industry and people associated with it. Portfolio Night is a global event that would take place in 20 cities including Mumbai on May 22. Tista Sen, national creative director and senior vice-president, JWT India, speaks on the theme in connection with event. Edited excerpts:
What is the purpose of Portfolio Night 11 in connection with the advertising industry?
I think advertising to a certain extent needs to get back its mojo and Portfolio Night can play a significant role in achieving it. This event is an attempt to establish a dialogue with the young people. It’s also an eye-opener for people within the trade who may have got slightly deviated from the purpose they chose to be in this field. This is also to reinforce our clients’ belief in the work we do — the what, how and why of it — thereby regaining the credibility and authenticity of being a communicator, someone who builds brand value and brand equity so that it connects with consumers.
What went behind putting the theme for the event?
While putting together a theme, we felt it was time to really bring back the glory, prestige and values of what advertising really is. In the last couple of years there has been a huge erosion in terms of the core value of advertising. We wanted to approach it from the youngsters’ point of view — the superficial side — do you speak good English, is your hair long, do you wear earring?, etc.
That’s one part of it. The other part is that being in advertising is as serious as being in any other profession. Attributes like hard work, perseverance, commitment and putting in long working hours are true for advertising as it is in any other industry. So in that sense, the campaign is a real eye opener clearing all the notions in the market place.
How has the initiative been received thus far?
We created the initial buzz and excitement around the campaign on the Twitter platform with a hashtag #WhatIThinkAboutAdvertising. It was decided that as and when thoughts on advertising are shared, we will busts the myths and tell them this is what advertising is all about. We created three campaigns (consist of posters, hoardings, radio spots, social media activities and TVCs) highlighting some of the misconceptions about the advertising industry including ‘Women creatives can’t make it big in advertising’, ‘You cant be creative if you don’t have long hair’ and ‘Copywriters do all the thinking, art directors merely execute’.
How many people have registered for the Portfolio Night 11?
As we speak, there are 88 aspirants who have registered for the event. That’s a fantastic number considering we still have 4-5 days in hand before the event.
JWT India, a unit of WPP, the world’s largest advertising group, recently unveiled a theme ‘An Eye-Opener’ for Portfolio Night 11 to clear misconceptions aspirants have about the advertising industry and people associated with it. Portfolio Night is a global event that would take place in 20 cities including Mumbai on May 22. Tista Sen, national creative director and senior vice-president, JWT India, speaks on the theme in connection with event. Edited excerpts:
What is the purpose of Portfolio Night 11 in connection with the advertising industry?
I think advertising to a certain extent needs to get back its mojo and Portfolio Night can play a significant role in achieving it. This event is an attempt to establish a dialogue with the young people. It’s also an eye-opener for people within the trade who may have got slightly deviated from the purpose they chose to be in this field. This is also to reinforce our clients’ belief in the work we do — the what, how and why of it — thereby regaining the credibility and authenticity of being a communicator, someone who builds brand value and brand equity so that it connects with consumers.
What went behind putting the theme for the event?
While putting together a theme, we felt it was time to really bring back the glory, prestige and values of what advertising really is. In the last couple of years there has been a huge erosion in terms of the core value of advertising. We wanted to approach it from the youngsters’ point of view — the superficial side — do you speak good English, is your hair long, do you wear earring?, etc.
That’s one part of it. The other part is that being in advertising is as serious as being in any other profession. Attributes like hard work, perseverance, commitment and putting in long working hours are true for advertising as it is in any other industry. So in that sense, the campaign is a real eye opener clearing all the notions in the market place.
How has the initiative been received thus far?
We created the initial buzz and excitement around the campaign on the Twitter platform with a hashtag #WhatIThinkAboutAdvertising. It was decided that as and when thoughts on advertising are shared, we will busts the myths and tell them this is what advertising is all about. We created three campaigns (consist of posters, hoardings, radio spots, social media activities and TVCs) highlighting some of the misconceptions about the advertising industry including ‘Women creatives can’t make it big in advertising’, ‘You cant be creative if you don’t have long hair’ and ‘Copywriters do all the thinking, art directors merely execute’.
How many people have registered for the Portfolio Night 11?
As we speak, there are 88 aspirants who have registered for the event. That’s a fantastic number considering we still have 4-5 days in hand before the event.
Ajay Piramal bets Rs 1,652 crore on Shriram Transport
This story first appeared in DNA Money edition on Saturday, May 11, 2013.
Piramal Enterprises has acquired a 10% stake in Shriram Transport Finance Co Ltd (STFC), the country’s largest player in commercial vehicle finance, for Rs 1,652 crore.
Piramal acquired 2,28,47,468 shares from US-based private equity major TPG Capital at a price of Rs 753 per share, making it the largest bulk deal so far this fiscal.
“We see this deal as a beginning of a long-term partnership with Shriram Group as its business is very much in harmony with what we are doing,” said Piramal group chairman Ajay Piramal.
Asked if the group planned to increase stake further in STFC, Piramal said, “There are no such plans as of now.”
Piramal group, with presence in pharmaceutical, financial services and information management sectors, had consolidated revenues of over Rs 3,560 crore last fiscal. In the financial services space, it has a real estate focused PE fund – Indiareit – and a non-banking finance company (NBFC) focused on lending to real estate and education sector with a loan book of Rs 1,000 crore.
The company also makes structured investments in infrastructure projects and has recently struck deals with Hyderabad-based infrastructure company Navayuga Road Projects and renewable energy firm Green Infra.
Earlier reports had said that for the financial services vertical, Piramal was looking to build an asset size of Rs 15,000 crore in the next five years.
The deal between Piramal and TPG also indicates that the latter may have completely exited its investments in STFC, generating near seven times returns in as many years.
Newbridge India Investment II Ltd, a unit of TPG, had in 2006 acquired a 49% stake in unlisted group holding company Shriram Holding Madras Pvt Ltd (SHMPL), which currently holds 41.25% in STFC. When STFC was merged with SHMPL in December 2011, Newbridge got a 20.28% stake in the merged entity.
As per Bloomberg data, the (post-merger) acquisition cost of the 2006 deal for TPG worked out to Rs 112.75 per share.
In a bulk deal on the National Stock Exchange in February, Newbridge had sold 23.15 million STFC shares (or a 10.2% stake) to a clutch of institutional investors for Rs 1,656 crore. That deal is understood to have netted TPG a whopping 450-500% returns, or a cool Rs 1,350 crore in profit.
Shriram Transport, which logged revenues of Rs 7,014 crore and a profit after tax of Rs 1,463 crore last fiscal, had assets of over Rs 52,717 crore under management and is among India’s largest player in commercial vehicle finance with a niche presence in financing pre-owned and small truck owners.
The company has a network of 528 branches and service centres across India and is also one of the largest asset financing NBFCs in the country.
Piramal Enterprises has acquired a 10% stake in Shriram Transport Finance Co Ltd (STFC), the country’s largest player in commercial vehicle finance, for Rs 1,652 crore.
Piramal acquired 2,28,47,468 shares from US-based private equity major TPG Capital at a price of Rs 753 per share, making it the largest bulk deal so far this fiscal.
“We see this deal as a beginning of a long-term partnership with Shriram Group as its business is very much in harmony with what we are doing,” said Piramal group chairman Ajay Piramal.
Asked if the group planned to increase stake further in STFC, Piramal said, “There are no such plans as of now.”
Piramal group, with presence in pharmaceutical, financial services and information management sectors, had consolidated revenues of over Rs 3,560 crore last fiscal. In the financial services space, it has a real estate focused PE fund – Indiareit – and a non-banking finance company (NBFC) focused on lending to real estate and education sector with a loan book of Rs 1,000 crore.
The company also makes structured investments in infrastructure projects and has recently struck deals with Hyderabad-based infrastructure company Navayuga Road Projects and renewable energy firm Green Infra.
Earlier reports had said that for the financial services vertical, Piramal was looking to build an asset size of Rs 15,000 crore in the next five years.
The deal between Piramal and TPG also indicates that the latter may have completely exited its investments in STFC, generating near seven times returns in as many years.
Newbridge India Investment II Ltd, a unit of TPG, had in 2006 acquired a 49% stake in unlisted group holding company Shriram Holding Madras Pvt Ltd (SHMPL), which currently holds 41.25% in STFC. When STFC was merged with SHMPL in December 2011, Newbridge got a 20.28% stake in the merged entity.
As per Bloomberg data, the (post-merger) acquisition cost of the 2006 deal for TPG worked out to Rs 112.75 per share.
In a bulk deal on the National Stock Exchange in February, Newbridge had sold 23.15 million STFC shares (or a 10.2% stake) to a clutch of institutional investors for Rs 1,656 crore. That deal is understood to have netted TPG a whopping 450-500% returns, or a cool Rs 1,350 crore in profit.
Shriram Transport, which logged revenues of Rs 7,014 crore and a profit after tax of Rs 1,463 crore last fiscal, had assets of over Rs 52,717 crore under management and is among India’s largest player in commercial vehicle finance with a niche presence in financing pre-owned and small truck owners.
The company has a network of 528 branches and service centres across India and is also one of the largest asset financing NBFCs in the country.
Godrej Prop readying Rs 700 crore rights issue
This story first appeared in DNA Money edition on Friday, May 10, 2013.
Godrej Properties is planning a Rs 700 crore rights issue to finance its existing and new projects across the country. While the pricing is yet to be decided, the company hopes to wrap up the issue by September. Pirojsha Godrej, managing director and CEO, Godrej Properties, said the board has approved the issue. “This issue will allow us to create necessary funding, thereby growing the portfolio very rapidly without requiring in any way to stretch our balance sheet,” he said. The company’s debt currently stands at a little under Rs 1,500 crore.
The company’s revenues in the January-March quarter of 2012-13 declined 16% to Rs 313.9 crore a year earlier. Operating profit slipped 1.56% on-year to Rs 100.4 crore though net profit grew 33.66% to Rs 53.2 crore. For the full 2012-13, revenues, bookings and net profit went up significantly by 28%, 71% and 41%, respectively, in comparison to fiscal 2012.
“Despite poor macro economic environment and relative underperformance of the real estate sector this year, our Ebitda increased 43%. In terms of bookings, we crossed $500 million in new sales,” said Godrej.
While the last fiscal saw the realtor pull off a total of 13 launches in six cities across the country, the management is confident of rolling out 15-20 new projects this fiscal. The new launches will include phases of existing projects.
Godrej said the company registered good traction in major target markets of NCR-Gurgaon (Summit), Mumbai (Platinum at Vikhroli) and Bangalore this fiscal. “At Vikhroli, we increased prices by around 40% year on year despite the market not being that strong. We sold about 400,000 sq ft during the year at E City Bangalore. Around 1 million sq ft of sales were made at the Gurgaon project in a single day,” said Godrej, who sees prices sustaining due to inflation and rising input costs for real estate companies.
Godrej Properties is planning a Rs 700 crore rights issue to finance its existing and new projects across the country. While the pricing is yet to be decided, the company hopes to wrap up the issue by September. Pirojsha Godrej, managing director and CEO, Godrej Properties, said the board has approved the issue. “This issue will allow us to create necessary funding, thereby growing the portfolio very rapidly without requiring in any way to stretch our balance sheet,” he said. The company’s debt currently stands at a little under Rs 1,500 crore.
The company’s revenues in the January-March quarter of 2012-13 declined 16% to Rs 313.9 crore a year earlier. Operating profit slipped 1.56% on-year to Rs 100.4 crore though net profit grew 33.66% to Rs 53.2 crore. For the full 2012-13, revenues, bookings and net profit went up significantly by 28%, 71% and 41%, respectively, in comparison to fiscal 2012.
“Despite poor macro economic environment and relative underperformance of the real estate sector this year, our Ebitda increased 43%. In terms of bookings, we crossed $500 million in new sales,” said Godrej.
While the last fiscal saw the realtor pull off a total of 13 launches in six cities across the country, the management is confident of rolling out 15-20 new projects this fiscal. The new launches will include phases of existing projects.
Godrej said the company registered good traction in major target markets of NCR-Gurgaon (Summit), Mumbai (Platinum at Vikhroli) and Bangalore this fiscal. “At Vikhroli, we increased prices by around 40% year on year despite the market not being that strong. We sold about 400,000 sq ft during the year at E City Bangalore. Around 1 million sq ft of sales were made at the Gurgaon project in a single day,” said Godrej, who sees prices sustaining due to inflation and rising input costs for real estate companies.
Glenmark sees sales growth slowing to 20%
This story first appeared in DNA Money edition on Thursday, May 9, 2013.
Glenmark Pharma sees its overall sales growing at a slower 20% this fiscal from the 38% pace logged in the last fiscal on account slowdown in India and delay in US drug approvals.
Glenn Saldanha, chairman and managing director, Glenmark, said the guidance for India business, too, is 18-20%.
“There is a slowdown in the India business and the IMF data for the last 4-5 months is very bad for the industry as a whole. In this environment we think an 18-20% growth number is doable because we are also adding OTC (over-the-counter), generic components and anti-diabetes drugs (Zita and Zita-Met) to these numbers, which will be significant contributors,” Saldanha on an earnings call.
Analysts said the growth guidance is in line with the projections.
Manoj Garg, pharma analyst, Edelweiss Securities, said, “If the company is anticipating 18-20% growth despite high research and development (R&D) expenditure, it’s a reasonably fair guidance. The current over 35% growth is not sustainable given the base is likely to increase coupled with slowdown in the market.”
The company said that its R&D expenditure this fiscal would be about 8.5% of net sales. While innovative R&D will see normal increase, the increase in absolute R&D spend is primarily towards the US business. The management has also earmarked capex of Rs 250 crore for the current fiscal.
Glenmark’s operating profit, excluding out-licensing income, is expected to be Rs 1,225 crore. The company expects net debt-to-Ebitda ratio to improve further this fiscal from the current 2.12. Its net debt currently stands at around Rs 2,000 crore.
The focus, the company said, will be to reduce debt from free cash with more significant merger and acquisition plans this financial year.
“We are very confident about bringing down the absolute debt number this year onwards. Free cash generation should start to be pretty substantial, going forward,” said Saldanha.
For the US business, Glenmark is expecting a more or less similar growth of 18% this fiscal, citing poor visibility and timing of US Food and Drug Administration (FDA) approvals.
“The next few years should be much better because of the filing grade and the product pipeline.
We should see better growth in the subsequent two years wherein we can expect over 25% CAGR from the US business,” Saldanha said.
Terrance Coughlin, CEO, Glenmark Generics Inc, US, said the industry as a whole is seeing a slowdown in approvals.
“For fiscal 2014, we anticipate 8-12 approvals in oral contraceptives, dermatology products and immediate release products.
Glenmark’s US pipeline comprises 53 abbrievated new drug applications (Anda) that fall into a less competitive landscape and the company is targeting to file another 20 this fiscal. “Of the total filings, 50-75% are in the niche category. We continue to focus on dermatology (derma) and oral contraceptive,” Coughlin said.
Glenmark Pharma sees its overall sales growing at a slower 20% this fiscal from the 38% pace logged in the last fiscal on account slowdown in India and delay in US drug approvals.
Glenn Saldanha, chairman and managing director, Glenmark, said the guidance for India business, too, is 18-20%.
“There is a slowdown in the India business and the IMF data for the last 4-5 months is very bad for the industry as a whole. In this environment we think an 18-20% growth number is doable because we are also adding OTC (over-the-counter), generic components and anti-diabetes drugs (Zita and Zita-Met) to these numbers, which will be significant contributors,” Saldanha on an earnings call.
Analysts said the growth guidance is in line with the projections.
Manoj Garg, pharma analyst, Edelweiss Securities, said, “If the company is anticipating 18-20% growth despite high research and development (R&D) expenditure, it’s a reasonably fair guidance. The current over 35% growth is not sustainable given the base is likely to increase coupled with slowdown in the market.”
The company said that its R&D expenditure this fiscal would be about 8.5% of net sales. While innovative R&D will see normal increase, the increase in absolute R&D spend is primarily towards the US business. The management has also earmarked capex of Rs 250 crore for the current fiscal.
Glenmark’s operating profit, excluding out-licensing income, is expected to be Rs 1,225 crore. The company expects net debt-to-Ebitda ratio to improve further this fiscal from the current 2.12. Its net debt currently stands at around Rs 2,000 crore.
The focus, the company said, will be to reduce debt from free cash with more significant merger and acquisition plans this financial year.
“We are very confident about bringing down the absolute debt number this year onwards. Free cash generation should start to be pretty substantial, going forward,” said Saldanha.
For the US business, Glenmark is expecting a more or less similar growth of 18% this fiscal, citing poor visibility and timing of US Food and Drug Administration (FDA) approvals.
“The next few years should be much better because of the filing grade and the product pipeline.
We should see better growth in the subsequent two years wherein we can expect over 25% CAGR from the US business,” Saldanha said.
Terrance Coughlin, CEO, Glenmark Generics Inc, US, said the industry as a whole is seeing a slowdown in approvals.
“For fiscal 2014, we anticipate 8-12 approvals in oral contraceptives, dermatology products and immediate release products.
Glenmark’s US pipeline comprises 53 abbrievated new drug applications (Anda) that fall into a less competitive landscape and the company is targeting to file another 20 this fiscal. “Of the total filings, 50-75% are in the niche category. We continue to focus on dermatology (derma) and oral contraceptive,” Coughlin said.
Wednesday, 8 May 2013
Turnaround in AC sales keeps pace with summer heat
My colleague Nupur Anand co-authored this story first appearing in DNA Money edition on Wednesday, May 8, 2013.
Makers of air conditioners (ACs) are rejoicing as sales are zooming up, thanks to the scorching summer, unlike last year when the market de-grew 26% on-year in the January-April period.
The residential AC market alone sees sales of up to 3.5 million units annually. Dealers and manufacturers said the overall AC market is growing by about 10-12% on-year this year. They attribute the turnaround to stable prices.
Mahesh Krishnan, vice-president (consumer electronics), Samsung India, said that unlike last year, prices have remained stable this year, boosting sales. “Last year, the rupee had depreciated almost 4% and this had led to a 10-15% increase in prices, affecting demand.”
Saurabh Baisakhia, business head-AC, LG India, agreed that demand has improved. He expects it to stay strong. “Demand for LG ACs has improved by 20% on-year. Consumers are buying more energy-efficient products. So, the 4- and 5-star ACs are selling faster.”
Sanjay Mahajan, vice president-sales and marketing, Carrier Midea India, said energy-savers, though 15-25% more expensive than regular models, are viewed as ‘value for money’ by Indian consumers. For example, a typical 1.5 tonne, 3-star AC costs up to Rs 32,000, while a 5-star product could retail for Rs 37,000.
Consumers’ preference is also shifting from window ACs to split ACs. A Navi Mumbai consumer says he invested around Rs 30,000 last week on a 5-star split AC because he wanted his pet dog Toffee, an English cocker spaniel, too, to stay cool. “Heat this summer is almost unbearable. The split aircon now serves both my bedroom and the living room where Toffee relaxes.”
Krishnan of Samsung said that in south India, split ACs now account for over 90% of sales. In contrast, the window AC market has hardly seen any growth over the last few years, industry observers said. Shifting sales are forcing AC-makers to rethink their strategies. Some are either lowering or discontinuing production of window ACs. However, industry experts believe that most AC-makers will wait for at least one more year before withdrawing from this segment altogether.
Ramesh Shah, MD of Sony Mony Electronics, a retail chain, says that easy financing options and value add-ons like free installation are also driving sales. With foreign exchange and raw material costs remaining stable, the AC industry is expected to grow by 15% this fiscal, say experts.
Makers of air conditioners (ACs) are rejoicing as sales are zooming up, thanks to the scorching summer, unlike last year when the market de-grew 26% on-year in the January-April period.
The residential AC market alone sees sales of up to 3.5 million units annually. Dealers and manufacturers said the overall AC market is growing by about 10-12% on-year this year. They attribute the turnaround to stable prices.
Mahesh Krishnan, vice-president (consumer electronics), Samsung India, said that unlike last year, prices have remained stable this year, boosting sales. “Last year, the rupee had depreciated almost 4% and this had led to a 10-15% increase in prices, affecting demand.”
Saurabh Baisakhia, business head-AC, LG India, agreed that demand has improved. He expects it to stay strong. “Demand for LG ACs has improved by 20% on-year. Consumers are buying more energy-efficient products. So, the 4- and 5-star ACs are selling faster.”
Sanjay Mahajan, vice president-sales and marketing, Carrier Midea India, said energy-savers, though 15-25% more expensive than regular models, are viewed as ‘value for money’ by Indian consumers. For example, a typical 1.5 tonne, 3-star AC costs up to Rs 32,000, while a 5-star product could retail for Rs 37,000.
Consumers’ preference is also shifting from window ACs to split ACs. A Navi Mumbai consumer says he invested around Rs 30,000 last week on a 5-star split AC because he wanted his pet dog Toffee, an English cocker spaniel, too, to stay cool. “Heat this summer is almost unbearable. The split aircon now serves both my bedroom and the living room where Toffee relaxes.”
Krishnan of Samsung said that in south India, split ACs now account for over 90% of sales. In contrast, the window AC market has hardly seen any growth over the last few years, industry observers said. Shifting sales are forcing AC-makers to rethink their strategies. Some are either lowering or discontinuing production of window ACs. However, industry experts believe that most AC-makers will wait for at least one more year before withdrawing from this segment altogether.
Ramesh Shah, MD of Sony Mony Electronics, a retail chain, says that easy financing options and value add-ons like free installation are also driving sales. With foreign exchange and raw material costs remaining stable, the AC industry is expected to grow by 15% this fiscal, say experts.
Consumer cos step up rural push as polls loom
This story first appeared in DNA Money edition on Tuesday, May 7, 2013.
Consumer goods companies such as GlaxoSmithKline Consumer Healthcare, Bajaj Corp and Dabur, which cater to the $13.1 billion (Rs71,000 crore) national market, are sharpening focus on rural distribution in anticipation of higher spends.
Factors like this being a pre-general election fiscal year, expectation of normal monsoon and government initiatives like high minimum support price for agricultural produce, aimed at passing on subsidies to rural India, are all expected to increase disposable incomes and hence spends in the hinterland, which accounts for 67% (or Rs47,150 crore) of FMCG sales.
According to Ramakrishnan Subramanian, director-finance, GlaxoSmithKline Consumer, demand and response from the rural market are up. “We are targeting to reach 10,000 villages this fiscal. Our intention is to reach 50,000 villages by 2016,” he told an earnings call.
According to ruralmarketing.org, India has 6.27 lakh villages in all; and business in rural India grew about 11% on average annually over the last decade. FMCG sales are expected to grow toward $33 billion by 2015, of which $22.1 billion will be contributed by rural areas.
Harminder Sahni, founder and MD of Wazir Advisors, said, “Tractor sales last quarter were good, indicating strong rural spend. This is driving consumer goods companies to go after the rural consumers in a focused manner.”
Specialist firms are helping consumer goods makers in this regard. For instance, Mumbai-based RW Promotions works with a host of consumer goods companies in covering 2-3 villages on a daily basis.
S Venkatesh, director, RW Promotions, said, “The rural distribution push is all about tapping aspirations. As a result, pack sizes and prices are being tweaked to make the products more attractive and affordable for villagers. Though market response varies from product to product, sales every day average upwards of Rs3,000 per village.”
Distribution, therefore, has emerged as a key driver of demand. For instance, Bajaj Corp, maker of haircare products, has been driving rural distribution through van operations in states where its enjoys a high market share.
“We have close to 150 vans covering 9,000 villages on a monthly basis,” said Sumit Malhotra, MD of Bajaj Corp. The ‘drive’ has helped deepen the penetration of Bajaj Almond Drops hair oil to 27 lakh retail outlets across India. “Almost 40% of our value sales are coming from rural markets,” he said.
After creating a strong distribution network last year, Dabur India, maker of fruit juices, wellness products, oral, skin and haircare, initiated ‘Project Double’ wherein it not only doubled its direct reach from 14,865 villages to 30,091 but also improved the quality of coverage.
This meant that even villages with a population of no more than 3,000 each across ten states, representing 72-75% of the rural FMCG potential, now have access to Dabur products.
Consumer goods companies such as GlaxoSmithKline Consumer Healthcare, Bajaj Corp and Dabur, which cater to the $13.1 billion (Rs71,000 crore) national market, are sharpening focus on rural distribution in anticipation of higher spends.
Factors like this being a pre-general election fiscal year, expectation of normal monsoon and government initiatives like high minimum support price for agricultural produce, aimed at passing on subsidies to rural India, are all expected to increase disposable incomes and hence spends in the hinterland, which accounts for 67% (or Rs47,150 crore) of FMCG sales.
According to Ramakrishnan Subramanian, director-finance, GlaxoSmithKline Consumer, demand and response from the rural market are up. “We are targeting to reach 10,000 villages this fiscal. Our intention is to reach 50,000 villages by 2016,” he told an earnings call.
According to ruralmarketing.org, India has 6.27 lakh villages in all; and business in rural India grew about 11% on average annually over the last decade. FMCG sales are expected to grow toward $33 billion by 2015, of which $22.1 billion will be contributed by rural areas.
Harminder Sahni, founder and MD of Wazir Advisors, said, “Tractor sales last quarter were good, indicating strong rural spend. This is driving consumer goods companies to go after the rural consumers in a focused manner.”
Specialist firms are helping consumer goods makers in this regard. For instance, Mumbai-based RW Promotions works with a host of consumer goods companies in covering 2-3 villages on a daily basis.
S Venkatesh, director, RW Promotions, said, “The rural distribution push is all about tapping aspirations. As a result, pack sizes and prices are being tweaked to make the products more attractive and affordable for villagers. Though market response varies from product to product, sales every day average upwards of Rs3,000 per village.”
Distribution, therefore, has emerged as a key driver of demand. For instance, Bajaj Corp, maker of haircare products, has been driving rural distribution through van operations in states where its enjoys a high market share.
“We have close to 150 vans covering 9,000 villages on a monthly basis,” said Sumit Malhotra, MD of Bajaj Corp. The ‘drive’ has helped deepen the penetration of Bajaj Almond Drops hair oil to 27 lakh retail outlets across India. “Almost 40% of our value sales are coming from rural markets,” he said.
After creating a strong distribution network last year, Dabur India, maker of fruit juices, wellness products, oral, skin and haircare, initiated ‘Project Double’ wherein it not only doubled its direct reach from 14,865 villages to 30,091 but also improved the quality of coverage.
This meant that even villages with a population of no more than 3,000 each across ten states, representing 72-75% of the rural FMCG potential, now have access to Dabur products.
Sunday, 5 May 2013
British healthcare firms eye India opportunities
This story first appeared in DNA Money edition on Saturday, May 4, 2013.
A high-powered British delegation, comprising Kenneth Clarke, senior British Cabinet minister and the prime minister’s trade envoy for healthcare, is headed for India to explore ways and means of working together in healthcare and allied space. They will be in Mumbai and Chennai on May 6-7, 2013.
In all, there will be 23 companies, including London Ambulance Service, Serco, TPP, Royal Free Hospital, BMJ, King’s College Hospital and Healthcare UK, and 30 delegates accompanying Clarke.
“Some of the prominent British companies are now being drawn to India to return the favour in kind. As a result of the National Health Service (NHS), people in Britain have some of the fastest access to general practitioners (GPs) in the world, the best coordinated care, and they suffer from the fewest medical errors,” he said.
In Mumbai, Clarke and the delegation are slated to meet state health minister Suresh Shetty and health ministry officials. They will also visit some of the prominent healthcare establishments viz. Healthspring and Global Hospitals. The Mumbai visit, in fact, is a build-up to the British PM David Cameron’s India visit earlier in February.
A high-powered British delegation, comprising Kenneth Clarke, senior British Cabinet minister and the prime minister’s trade envoy for healthcare, is headed for India to explore ways and means of working together in healthcare and allied space. They will be in Mumbai and Chennai on May 6-7, 2013.
In all, there will be 23 companies, including London Ambulance Service, Serco, TPP, Royal Free Hospital, BMJ, King’s College Hospital and Healthcare UK, and 30 delegates accompanying Clarke.
“Some of the prominent British companies are now being drawn to India to return the favour in kind. As a result of the National Health Service (NHS), people in Britain have some of the fastest access to general practitioners (GPs) in the world, the best coordinated care, and they suffer from the fewest medical errors,” he said.
In Mumbai, Clarke and the delegation are slated to meet state health minister Suresh Shetty and health ministry officials. They will also visit some of the prominent healthcare establishments viz. Healthspring and Global Hospitals. The Mumbai visit, in fact, is a build-up to the British PM David Cameron’s India visit earlier in February.
Despite offers, residential sales stay sluggish
This story first appeared in DNA Money edition on Saturday, May 4, 2013.
The residential real estate sector in India continues to witness a lull despite discounts and schemes on offer by developers.
Sales in Mumbai Metropolitan Region (MMR) grew a mere 1% to 10.45 million square feet in January-March quarter from 10.3 msf in the preceding quarter, while they declined in Hyderabad and Pune, according to Liases Foras Real Estate Rating & Research.
Only National Capital Region (NCR) and Chennai markets saw 24% and 36% rise in sales, respectively.
Pankaj Kapoor, managing director, Liases Foras, said, “Residential sales in Bangalore and Pune decline by 16% and 7%, respectively, while Hyderabad presented a gloomy picture with sales plunging 46% sequentially.”
Housing prices rose across cities, with the highest increase seen in Bangalore at 6% to Rs 5,004 in Q4 over the preceding quarter.
The Mumbai market saw price gain of 3%.
Pune and Bangalore markets suffered mainly due to escalation in prices.
The sluggish IT industry in these markets indicated the private equity investments, cash-out deals and high land valuations were the main reasons for price rise.
On the whole, the price of new supply was lower than that of existing supply.
While the Mumbai market saw maximum number of launches, NCR, Pune, Hyderabad and Bangalore showed significant shrinkage in their numbers.
“Maximum new supply in MMR is in the cost range of Rs 1-2 crore and it is affordable housing that led the pack in NCR. Other markets saw a mix of budget and affordable housing in terms of new supply,” Kapoor said.
“With unabated price rises and limited launches this quarter, it remains to be seen whether the cash strapped developers are successful in selling out their existing unsold stock with the prevalent schemes and waivers. The lowering of interest rates would also prove to be a boon in the long run,” said Kapoor.
While inventories declined in Chennai and NCR markets, Hyderabad painted a dismal picture with inventories at 49 months compared with 23 in the preceding quarter.
The residential real estate sector in India continues to witness a lull despite discounts and schemes on offer by developers.
Sales in Mumbai Metropolitan Region (MMR) grew a mere 1% to 10.45 million square feet in January-March quarter from 10.3 msf in the preceding quarter, while they declined in Hyderabad and Pune, according to Liases Foras Real Estate Rating & Research.
Only National Capital Region (NCR) and Chennai markets saw 24% and 36% rise in sales, respectively.
Pankaj Kapoor, managing director, Liases Foras, said, “Residential sales in Bangalore and Pune decline by 16% and 7%, respectively, while Hyderabad presented a gloomy picture with sales plunging 46% sequentially.”
Housing prices rose across cities, with the highest increase seen in Bangalore at 6% to Rs 5,004 in Q4 over the preceding quarter.
The Mumbai market saw price gain of 3%.
Pune and Bangalore markets suffered mainly due to escalation in prices.
The sluggish IT industry in these markets indicated the private equity investments, cash-out deals and high land valuations were the main reasons for price rise.
On the whole, the price of new supply was lower than that of existing supply.
While the Mumbai market saw maximum number of launches, NCR, Pune, Hyderabad and Bangalore showed significant shrinkage in their numbers.
“Maximum new supply in MMR is in the cost range of Rs 1-2 crore and it is affordable housing that led the pack in NCR. Other markets saw a mix of budget and affordable housing in terms of new supply,” Kapoor said.
“With unabated price rises and limited launches this quarter, it remains to be seen whether the cash strapped developers are successful in selling out their existing unsold stock with the prevalent schemes and waivers. The lowering of interest rates would also prove to be a boon in the long run,” said Kapoor.
While inventories declined in Chennai and NCR markets, Hyderabad painted a dismal picture with inventories at 49 months compared with 23 in the preceding quarter.
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