Growing at 21% year on year, Wipro Consumer Care and Lighting (WCCL) is expecting its commercial lighting business and past acquisitions such as Yardley to push growth going forward. President of WCCL Vineet Agarwal talks to FE?s Shreya Roy about acquisition plans, its role in Wipro?s larger picture and about its performance over the past quarter.
The Consumer care and lighting business has grown to Rs 695 crore in the third quarter against to Rs 665 crore in the second quarter. Would you say sequential growth has remained flat?
FMCG business works on a more year on year basis, due to the element of seasonality. For example, this quarter has been good for our diaper business, liquid detergent. Again, soaps and Glucovita are not good for the winters but they have been offset by other products. Year on year, we grew at 21%, compared to 20% last quarter. Over all, it has been in line with expectations.
What would you say have been your biggest drivers?
Our biggest win this quarter has been Yardley. The scare that we had when we acquired the brand is can we make it a younger brand. We made that change fairly successfully and suddenly you see the deodorant happening a lot more and we are selling deodorant the maximum as far as the Yardley portfolio is concerned in India. We acquired it in December 2009. If I look at growth compared to what the previous owner had seen in the corresponding period of the last fiscal, we have grown overall 28% and in India alone 85%.
Your contribution to the total revenue of Wipro has remained stagnant at 9% over the past two quarters. Are you comfortable with that?
It has to be seen that IT grows much faster than FMCG. What we really look at is, are we growing better than competition. For example, in Malaysia, FMCG grows at about 5 to 6% and we have managed 11% growth there.
The same applies in our commercial lighting business and furniture business. We are probably number two in the modular furniture business in India, within just 6 years of launching and we have done lighting for more than a large majority of green buildings in the country.
What will drive growth going forward?
Commercial lighting and furniture will do well. We have clear USPs there. Yardley particularly is expected to do well. Unza, our international business, is also expected to do better than market growth.
It has been a year since last acquisition. Considering the focus on commercial lighting and furniture, is that where the next acquisition will be?
If it adds value, yes. If I were to find a company which has differentiated products which I cannot make, a company that can give me a headstart, I will look at it. But not to increase revenues.
Since people know we are aggressive in acquiring something that fits, we have been approached by companies, and we are always in the process of evaluation.