Having demonstrated its insatiable appetite for global acquisition, India Inc is now flexing its brand muscle. In a bid to display huge intangible value hidden within their folds, scores of companies are putting value to their brands.
After getting a fix on valuation for its food and beverages brands, Godrej is in the process of getting its consumer care brands - Cinthol and Fairglow - valued. Last six months have seen companies such as, Cholayil Group, Tatas, Marico, Air Deccan and Pritish Nandy Communications to name a few, undertake similar exercises aimed at putting values to their respective brands.
Bajaj Hindusthan, say sources, is mooting a proposal to undertake valuation for its consumer product brands such as Bajaj Brahmi Amla and Bajaj Almond Drops. "You can't figure out where your brands are headed unless you put them through periodic measure and assess improvement or impairment in value," says Godrej Consumer Products president Hoshidar K Press. That pretty much echoes the new-found sentiment within India Inc.
From a time when brand valuation was only undertaken at the time of brand sale, corporate India has come a long way. Companies now want to invest in and nurture brands by undertaking periodic brand valuation exercises. "Companies are increasingly realising their real value is not resident in its tangible assets, but off the balance sheet. And to drive value further, they have begun to look at the assets that were not reviewed in the past," says Brand Finance India country manager Unni Krishnan. According to Mr Unni Krishnan, Indian companies have very high proportion - close to 65% - of intangible assets not reflected in their balance sheets. "Almost every professionally-managed company has now begun to measure and manage it on an ongoing basis."
A few months back, personal grooming and slimming firm, VLCC and low-cost air carrier, Air Deccan did a similar brand valuation exercise. It's akin to Indian marketers trying to put a worth to their self esteem and brand valuation is becoming like a annual brand health check. Another reason for the valuation rush is the fact that several companies are thinking in terms of putting the value of their brands on the balance sheet.
While high-profile companies have gained momentum on brand valuations, what surprises many is that even smaller players are bitten by a brand valuation bug. KS Oils, an MP-based mustard oil company, roped in Deloitte Haskins & Sells as its brand valuation agency three months back. This was done to ascertain the company brand basket's earning potential and prioritise resource allocation accordingly. Kolkata-based Emami Group which roped in Ernst & Young a few years back for brand valuation, says it would like to revisit its brand valuation again.