Modi Revlon is upbeat about the Indian cosmetics market. After achieving breakeven last fiscal after an eight-year stint in the country, the joint venture between Modi Mundipharma and Revlon has laid out expansion plans.
As part of the strategy, the company will be ploughing back 30 per cent of the company's Rs 100-crore sales turnover into market development this fiscal.
It is also planning a new manufacturing facility for fragrances in Assam and is exploring the possibility of getting Revlon's international men's cosmetics range, Mitchum, to India.
"The joint venture broke even last fiscal and we plan to invest Rs 30 crore in marketing and other market development activities in 2004-05," Mr U.K. Modi, Chairman of Modi Revlon Ltd, told Business Line.
"Our growth rate of over 30 per cent is more than double the rate at which the industry has grown over the last few years."
On setting up another manufacturing facility for fragrances in Assam, Mr Modi refused to specify a timeframe within which the new line will come up, only stating that plans were still being drawn up.
Modi Revlon already has a manufacturing facility in Assam where only about 50 per cent capacity utilisation has been achieved as yet.
The company considers colour cosmetics its major thrust area, with nail enamels and lipsticks.
However, it is also present in other product segments including shampoo (Flex), fragrances, hair colour (Colorsilk), fairness cream and a skin care range.
On the anvil are the launches of at least four new fragrances, four variants of lipsticks and three variants of Flex shampoo this fiscal.
While Mr Modi said that the company was not a mass player and thus remained unaffected by the recent price wars in the FMCG industry, he added that the new variants of Flex shampoo would be priced 25 per cent lower next month.
"We are not a mass market brand and our positioning is clearly premium or at best mass premium. Two years ago we launched the `Streetwear' range of cosmetics - aimed at price-conscious consumers - but the majority of our sales still come from the premium Revlon range of products. Also, on the distribution front, we are clear that the brand will only be available at top distribution points, not at every kirana and general merchandise store."
Mr Modi said that there are no plans to take the direct marketing route to increase penetration of Revlon products in the Indian market.
Quoting market research agency ORG, he claimed that his company had beaten other brands like Lakme and L'Oreal in the lipstick market this June by taking the number one slot with 28.6 per cent market share.
The company is evaluating the option of bringing the `Mitchum' range to India with its after-shave lotions, anti-perspirants and other products in the near future. Also on the cards is a plan to launch an entire nail care range (in addition to nail colours already present) in the country.