Big opportunity areas left ‘unattended’ under earlier regime: Eveready MD | The Financial Express

Big opportunity areas left ‘unattended’ under earlier regime: Eveready MD

“The company is now making investments in brands and distributions. These investments were lacking in the previous years,” Saha said during Eveready’s second quarter earnings call.

Big opportunity areas left ‘unattended’ under earlier regime: Eveready MD
The rechargeable flashlights category is currently around Rs 700 crore.

Dry cell battery major Eveready Industries left big opportunity areas unattended under the Khaitans, according to managing director Suvamoy Saha said. “The company is now making investments in brands and distributions. These investments were lacking in the previous years,” Saha said during Eveready’s second quarter earnings call.

Saha assumed charge as MD of the battery major in March after then chairman Aditya Khaitan and managing director Amritanshu Khaitan resigned following an open offer from the Burmans, the promoters of Dabur India.

“The new management is trying to bring in professionalism to the company. The whole team consists of professional management. I would say there is a lot of emphasis being put on people working enthusiastically in an entrepreneurial manner … and beyond that a lot of actions being [taken] on corporate governance,” Saha said, replying to a query on the cultural change under the new management.

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After the completion of the open offer in June, the Burman family reclassified themselves as promoters of Eveready Industries in July. The company appointed former Dabur chief Anand Chand Burman as chairman.

“In the earlier years, there were fewer charges on account of advertising and distribution investments. We are incurring those amounts now. Our present profitability statements have higher charges on accounts of brands and distribution,” he informed.

According to the MD, under the management of the Khaitans, big opportunity areas for the company were left “unattended”.

“Originally, all flashlights were dry cell battery operated. But over the last two-three years, the rechargeable category … is now actually the bigger of the two segments, and we did not at all address this category. It is a huge opportunity area because we are a much-loved flashlight brand,” Saha said.

The rechargeable flashlights category is currently around Rs 700 crore.

In the battery categories, too, there were pockets which the company left unattended.

“There were types where we were under-invested when compared with our overall market share. So these are the opportunity areas which we need to quickly grab on to … Being a mass distribution company, we didn’t attend or address the higher price range batteries, which we are doing now,” Saha said.

Eveready’s market share in the dry cell battery segment stood at 52.8% in Q2FY23. The company reported a 52.5% year-on-year fall in its consolidated net profit to Rs 14.73 crore for the second quarter. The net profit was impacted adversely by a non-cash charge of unamortised front-end fees of a loan repaid during the quarter and an adjustment to deferred taxes. Revenue from operations rose 12% y-o-y to Rs 375.75 crore from Rs 335.38 crore for the same period last fiscal.

In the battery segment, the company’s aspiration is to grow at a rate of 10% in the next four-five years, backed by better volume and premiumisation. It aims to grow lighting solutions segment’s business from around Rs 320 crore at present to Rs 1,000 crore in the next three years.

“In next three years, we should certainly looking at doubling the company’s turnover. The management team believes that it will happen. And then we will be certainly looking into entering new categories,” Saha said. The company had reported Rs 1,206.75 crore revenue from operations for the last financial year.

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First published on: 07-11-2022 at 03:40 IST