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Sunday, July 18, 2010

Information About Emami



HISTORY
The inception of Emami Group took place way back in mid seventies when two childhood friends, Mr. R.S. Agarwal and Mr. R.S. Goenka left their high profile jobs with the Birla Group to set up Kemco Chemicals, an Ayurvedic medicine and cosmetic manufacturing unit in Kolkata in 1974.

It was an extremely bold step in the early seventies when the Indian FMCG market was still dominated by multinationals. Several such companies headquartered in Kolkata were considering shifting out of West Bengal due to labor unrest and political problems.

But against all odds with a vision of combining the age old wisdom of Ayurveda with modern manufacturing techniques for creating winning brands the company was started with a meager amount of Rs. 20,000.

A dream of reaching out to the Indian middle class; a target audience whom they thought will have increasing potential for consumption, the company started manufacturing cosmetic products as well as Ayurvedic medicines under the brand name of Emami from a small factory in Kolkata.

In the early days the two friends used to go around places and sell their cosmetics from shop to shop. They piled their goods on hand pulled rickshaws and went on distribution drives making their brand extremely popular, available and acceptable among consumers.

The first-rate quality of the products soon created a consumer pull and gradually some people were hired to work for them. A chain of distributors was established and the sale of Emami products spread from West Bengal to rest of Eastern India and gradually to other states.

Emami Talcum, Emami Vanishing Cream and Emami Cold Cream were great favorite brands with the quality conscious consumers in the mid-seventies. The company soon became adept in selling beautiful dreams to Indian women interested in finding their own identity. The signature tune of “Emami” played over radio and TV became a household favorite.

In 1978, Himani Ltd (incorporated as a Private Limited Company in 1949) had become sick unit and was up for sale. Himani, almost a 100 year old company with good brand equity in Eastern India and a well laid out factory in Kolkata, was producing a number of cosmetics. Mr. Agarwal realized the opportunity and acquired Himani though for their young organization it was a tough task to mobilize resources for buying a sick unit and even tougher to turn it around to a profitable venture. The degree of financial risk involved was enormous considering the small capital base of the company in those days. However Mr. Agarwal, supported by Mr. Goenka decided to go ahead with the deal which later on proved to be the turning point for the organization.

Mr. Agarwal decided to produce in the Himani factory different types of health care items and toiletries based on Ayurvedic preparation. Ten years after commencement of the company, it launched their first flagship brand Boroplus Antiseptic Cream under the Himani umbrella in 1984. Many additional brands followed Boroplus including Boroplus Prickly Heat Powder which came as a brand extension of the mother brand. Emami brands started selling in all states of North, East and West India. Today Boroplus is not only the largest selling Antiseptic Cream in India but also in Russia, Ukraine, and Nepal.

Nineties was very eventful for Emami. The next flagship brand of the company Navratna Cool Oil came in the nineties under the Himani Umbrella and the second factory was opened at Pondicherry to expand production. Navratna over the years has becomea market leader in the cool oil category.

The introduction of new brands continued and the distribution network of the company was extended to South India with Navratna spear heading the process. In 1995, Kemco Chemicals, the partnership firm was converted into a Public Limited Company under the name and style of Emami Ltd. In 1998, Emami Ltd was merged with Himani Ltd and its name was changed to Emami Ltd as per fresh certificate of incorporation dated September1, 1998.

In 2000, with a view to concentrate on its core FMCG business, Emami’s investment undertaking was demerged and Pan Emami Cosmed Ltd. issued its fully paid up shares to shareholders of Emami in the ratio of 1:1. In 2003 a new factory unit was set up at Amingaon, Guwahati. A Public Issue of 50 lacs Equity Shares of Rs2/- each at a price of Rs. 70 followed in 2005. The issue was oversubscribed within few seconds of its opening with an overall over subscription of 36 times of the issue size. The share price sold at Rs. 70 today is quoted in the stock market as Rs. 210.

In 2005 Emami created a marketing history in India by launching Fair and Handsome, the first fairness cream for men.

In 2006 the company decided to introduce a Health Care Division and a number of new brands of Ayurvedic OTC medicines. The company has taken up the challenge of growing this new division with a dedicated and enthusiastic team working on this project.

Among the brands created by the company, today Navratna brand is Rs.200 crore followed by Boroplus brand standing at Rs.150 crore and Fairness family standing at Rs.55 crore. Sona Chandi Chyawanprash is number two and Menthoplus and Fast Relief are number two in their respective categories.

In 2006, J B Marketing & Finance Ltd., the erstwhile marketing company of the Emami Group merged with Emami Ltd. and the total turnover of Emami including sales in domestic and export market stood at Rs 516 crores at the end of the fiscal year 2006-07.

While Emami Limited is on lookout for acquisitions in India and abroad for inorganic growth in FMCG sector, it has also identified ‘Realty’ as another potential business opportunity. A wholly owned subsidiary, Emami Realty Pvt. Limited, has been formed in May, 2007 to take up this business. Apart from utilization of Emami’s war chest, it would also give Realty business an independent and separate focus since it would be a 100 per cent subsidiary of Emami Ltd. While aggressive growth in FMCG business would continue, Realty would further enhance profitability and shareholders’ wealth.

With in three decades, the company has grown into a huge Rs. 600 crore Emami Ltd under the flagship company of the Rs.1600 crore Emami Group.

Today, Emami Limited is lead by Mr. R S Agarwal and Mr. R S Goenka with the help of the second generation Promoter Directors from the two families. Qualified and dedicated set of professionals run the day to day operations of the company. Recently a new corporate office “Emami Tower” has been added to the history of the company which houses Emami Limited as well as all the other Group companies in Kolkata.


FOUNDERS MESSAGE



The consumer is looking for a health and wellness quotient in each aspect of his/her life and this is a deciding factor influencing consumer choice: from the food they eat to, where they live to the products they use. This preoccupation with wellness is especially witnessed within the personal care space, where health and beauty are now coming together. People are no longer satisfied with products that just make them look good or feel good, but also want them to ‘do-good’. Moreover, the do-good aspect is understood in terms of a health rather than a cosmetic benefit. Another trend signaling the merging of health and beauty is the emergence of herbal, natural and organic products within personal care, which are considered safe, sensitive to the skin and free of side-effects by consumers.

Since consumers actively seek health benefits from personal care products, they spend a lot of time researching the product before making a purchase decision. They want to know how a product works, what ingredients it contains, the properties and actions of these ingredients and results. People still love to pamper themselves with silky smooth creams and lotions, but they also make sure that their favorite personal care products are not just making them feel good but are also keeping them healthy. It is the convergence of these supposedly disparate developments that is growing the market for India’s fast-moving consumer goods sector in general and Emami Limited in particular.

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