1. Baba Ramdev, Patanjali popularity fail to deter FMCG firms; stocks soar up to 50% in 6 months

Baba Ramdev, Patanjali popularity fail to deter FMCG firms; stocks soar up to 50% in 6 months

Patanjali has failed to unnerve the stronghold of several MNC and domestic FMCG players as the shares of these companies continues to shine. The stocks of these 10 FMCG majors have risen as much as over 50% over the last six months.

By: | Updated: July 5, 2017 10:55 AM
The stock of Godrej Industries tops the list, which has gained 50.6% in six months, since the beginning of this year. It trades at Rs 653.6. (Image: Reuters)

Baba Ramdev’s Patanjali has increasingly expanded its market presence by positioning its products with a blend of Ayurveda and is often seen as a threat to MNC and domestic FMCG giants. But as it turns out, the established FMCG companies in India are hardly unfazed so far by the unconventional competitor, and in fact, seem to be thriving, if their share performance is anything to go by.

Patanjali Ayurveda, which has disrupted the market with what it claims are mostly herbal and ayurvedic products, and which openly calls out competitors’ products as based on harmful chemicals, recently posted a revenue of more than Rs 10,000 crore for the financial year 2016-2017, as was widely reported in the media. This makes the private company the third largest FMCG firm after the blue-chips ITC and HUL, whose respective revenues are at Rs 42,074.59 crores and Rs 32,416 crores.

Companies unfazed

However, despite its bright performance, Patanjali has failed to unnerve the stronghold of several MNC and domestic FMCG players as the shares of these companies continues to shine. The stocks of these 10 FMCG majors have risen as much as over 50% over the last six months. The list includes heavyweights Hindustan Unilever Ltd, ITC, Procter & Gamble Hygiene and Health Care Ltd, Colgate-Palmolive (India) Ltd, Britannia Industries Ltd.

The stock of Godrej Industries tops the list, which has gained 49.14% in six months, since the beginning of this year. It trades at Rs 649. The shares of 10 companies out of the total 15 on the Nifty FMCG index have risen between 15% and 36% during this period.

The following list includes ITC (up 36.67%), Hindustan Unilever (up 30.6%), Britannia Industries (up 30.78%), Godrej Consumer Products (up 29.15%), United Spirits (up 30.02%), Marico (24.12%), Colgate-Palmolive (up 24.55%), Tata Global Beverages (up 19.84%), Jubilant FoodWorks (up 19.09%) and P&G Hygiene and Health Care (up 15.4%).

The benchmark index Nifty FMCG too has shone, rising over 33% in the last six months and making a new all-time high of 27,896.95 points earlier this week.

Patanjali rises

Patanjali forayed into the Indian market way back in 1997 as a small pharmacy firm and later reintroduced itself into the FMCG sector in 2006. Patanjali has branded itself as an FMCG company with quasi-traditional and ayurvedic essence having the homegrown range of products.

Tracking the rise of Patanjali from its ayurvedic and sanctity of consumer products, the major fast-moving consumer goods companies including Hindustan Unilever and Colgate-Palmolive (India), which lacked ayurvedic offerings in their portfolio, are now aggressively launching natural and native products to extend their product basket in order to stop Patanjali from eating into their market share.

MNCs react

Colgate-Palmolive (India), the Indian arm of giant American consumer products company, which till 2015 positioned its toothpaste products as containing the goodness of neem, salt and clove, last year launched an India specific toothpaste called Cibaca Vedshakti. It is positioned as “packed with the goodness of natural ingredients to help keep dental problems away,” as it includes lemon, cloves, eucalyptus, basil, camphor and thymol. Cibaca Vedshakti is priced lower than Patanjali’s Dant Kanti.

On the same lines, HUL launched around 20 products including toothpaste, shampoos and skin creams under its relaunched brand Lever Ayush. These products have been co-created with Arya Vaidya Pharmacy, a leading Ayurveda Institute.

(First published on Tuesday, 4 July 2017 on www.financialexpress.com)

  1. S
    Sanjeet
    Jul 5, 2017 at 1:41 pm
    I think you people misleading public regarding Patanjali, a completely Indian Company.If our own country company Grows then our own people will be financially get more benefit and more earning opportunities and also Country grows.We should positively support.
    Reply
    1. RapistAndFalse ProphetMuhammed
      Jul 4, 2017 at 2:13 pm
      Feku Baba thought that people are fools to buy his propaganda . By trying to fool people that he is the only person selling Indian products , has not brains that there are so many good Indian FMCG companies in the market selling good quality products better than his products . All the s who believe in his stupid lies will one day get brains that they were only being cheated.
      Reply
      1. N
        Narayana
        Jul 4, 2017 at 10:48 pm
        PL can u explain how he is cheating
        Reply

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