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Hindustan Lever to develop culinary division into new business
Our Corporate Bureau
PUNE, January 4: Consumer goods major Hindustan Lever (HLL) is now developing its culinary division as a new business. Chairman KB Dadiseth said the food and processed sector held out huge opportunities so much so that Lever planned to introduce atta and its by-products using patented technology.Dadiseth was in the city to inaugurate Lever's first sealed tea-bag unit. Dadiseth outlined a strategy which focuses on volume growth, market share and operational cash flows. Lever will enter all segments of the market, he said, since no one segment will sustain growth. Unveiling Lever's entry into the culinary business, Dadiseth it would be under the Kissan brand name and would include branded staples, related products as well as jams, sauces and noodles. With the enormous quantities of food going waste in the country due to a lack of storage facilities, HLL could step in, buy from the farmer and release according to market requirements. However, this would be done only after cold chains, storage chains and
other infrastructure was in place. HLL's existing product, the Annapurna range of wheat flour, will use a new, patented, technology which will allow the "chappatis" made from the flour to remain soft for a few hours. Dadiseth was categorical that this would be priced at the same level as wheat flour ground at a local mill since pricing would be the key to its success. Another product that HLL is currently test marketing is "Dalda Feel Light" in the south and will soon be launched nationally. V Balaram, general manager (exports), said the large, industrial use tins of edible fats have been reintroduced following an increase in capacities. He explained that HLL had been unable to service the market out of its four units so it withdrew from the market. with ten manufacturing units now, HLL is able to offer full service, he added. Dadiseth, who was in Pune to inaugurate HLL's first sealed tea bag unit, said that HLL holds 48 per cent of the coffee market, as against 42 per cent for Nestle. While HLL's tea
business is among the biggest in the world, it has only touched the tip of the iceberg, he said. For the personal care segment, Dadiseth said the introduction of products from the Elizabeth Arden, Calvin Klein and Faberge ranges would ensure its entry into the premium segment. The new products introduced by Lakme are from the Elizabeth Arden range, he pointed out. While he declined to give a time frame for the entry, terming it "market sensitive," the launch is not likely to be far off. HLL's 50:50 joint ventures with Kimberly Clark (Kimberly Clark Lever) for the manufacture of diapers and feminine napkins and Lever Johnson for the manufacture of insecticides, will also introduce new products shortly. KCL will soon launch a 60 per cent cheaper brand of diapers, Huggies Nappie Pads, which is being test marketed in Hyderabad and will soon be launched nationally. On the performance of the venture, Dadiseth said sales volumes in the January- December 1997 period had doubled over the corresponding period in
1996. Since Lever Johnson's products have entered the market only over the last quarter of 1997, he said it would be difficult to project sales figures for the current year. He hinted at the launch of other products in the joint venture spread over the full year.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
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