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Dabur plans soaps foray — Stays open to buying brands

27-September-2004
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Dabur plans soaps foray — Stays open to buying brands

Dabur India Ltd (DIL) is exploring the possibility of a foray into the Rs 4,000-crore soap market, probably under brand name Vatika. The company is expected to develop the product in-house, even though it is "open" to acquiring any soap brand that may be up for grabs and fits its requirements.

When contacted, the Chief Executive Officer, Mr Sunil Duggal, told Business Line, "We are exploring options in soaps, both in the medicated and toilet soap category. And while we are open to acquiring a brand that fits our need, I do not think this is a very likely option. We may ultimately develop and launch the brand on our own, but no final decision has been taken on this."

DIL's International Business Division is already manufacturing toilet soaps at Dubai for exporting to several neighbouring countries, but Mr Duggal said the new product would not have the same formulation as Dabur Soaps.

"We have three to four formulations in Dabur Soaps, but these are meant purely for exports. It is unlikely that this formulation will be extended to the new brand," he said, adding that the company was studying both, launching a medicated soap on the Ayurvedic plank and a toilet soap that would be positioned in the herbal beauty slot.

Industry sources said that along with some other fast-moving consumer goods (FMCG) companies, DIL is also believed to be interested in acquiring Mysore Sandal Soap from the Karnataka Government, but the brand does not appear to be on the block immediately. The Rs 100-crore brand is being currently valued at about Rs 30 crore.

According to industry estimates, Hindustan Lever Ltd controls about 60 per cent of the soap market with brands including Lifebuoy, Lux, Rexona, Breeze and Hamam. After HLL come Nirma and Godrej with their respective brands. The medicated soap brands include Dettol and Margo.

The sources said several issues in DIL's possible foray into soaps remain to be sorted out. These include the unique selling proposition (USP) of the new brand in a market already overcrowded with soap brands — whether there can be economies of scale, if the company decides to manufacture the brand in-house. Mr Duggal said most of these issues are still being worked out and the company will take a final decision in due course.

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