The company is taking stock of all new product introductions to focus its organisational energies and resources on a vital few. The move is aimed at conserving Marico's strategic funding for fighting competition in addition to increasing investments in brands the company chooses to provide a fillip to.

In a faxed response to The Financial Express, the company has stated: ``In the last two years, Marico test-marketed a range of new products. We are now taking stock of which of these to focus energies on.'' While the company has internally shortlisted the brands it chooses to focus on, the names were not divulged.

Marico currently operates in product categories of hair care, fabric care, edible oils and processed foods. Marico's brands in the above categories are Parachute, Hair & Care, Revive, Saffola, Sweekar and Sil.

Though the company would continue to introduce new products, the number would depend upon the opportunities available, the company said. The company says that the choice of brands to focus on would be determined by their strategic importance and financial returns. The company earmarks a certain proportion of surpluses generated towards strategic funding.

``The company does have internal financial benchmarks which new products must achieve. While we cannot share specific details of our benchmarks, these comprise ROCE, EVA and payback thresholds,'' the company said.

Consequently, Marico is expected to revive a greater thrust on some of its recently launched products. Other products are expected to be de-prioritised.According to industry analysts, the company's short-term financials may get impacted in the run-up to consolidate upon new introductions to create long term value.

Commenting on this, Marico said: ``Investments in advertising and sales promotion, distribution expansion, product development and enhancement do not yield immediate results. Profits may thus be lower in the near term.''``Focussing on fewer products will conserve funds and organisational energies which may otherwise be spread thin over a larger range of new products. Thus a larger share of mind and funds could be deployed towards supporting each product, both new and established,'' the company says.

The Rs 553 crore FMCG company faces competition from multinationals like Hindustan Lever (HLL) which has strong financial muscle. The recent acquisition of a coconut oil brand (Coco Care) by HLL, is a strong indication of a marketing war in the offing in the branded coconut oil industry, where Marico's Parachute is a leader.

Parachute, a cash-cow brand of Marico, contributes roughly 53 per cent to the company's turnover. There is thus a strong need to continue to invest in strengthening the brand and its offshoots, analysts point out.

Saffola and Sweekar contribute about 18 per cent and 16 per cent to the company's sales. The other three brands, Hair & Care, Revive and SIL, make up around 3 per cent of the sales.