Shampoos lather up in rural mkts

Shampoos lather up in rural mkts

Author | Source: The Economic Times | Tuesday, Jan 17,2006 7:50 AM

Shampoos lather up in rural mkts

Consumers in rural markets appear to be driving the double-digit 20-25% growth rate that's currently being recorded by the Rs 1,450 crore shampoo market. The rural market has recorded a volume growth of 40% while the urban market is trailing along at 16%.

Industry officials said higher innovation and improved affordability in the market has helped increase penetration levels in the rural markets vis-à-vis the more saturated urban markets.

Market leader HLL saw its brands, Clinic and Sunsilk, clock a rise in market share to 48% in November '05 from 46.8% in November '04. Clinic's growth in volumes on a quarter-on-quarter basis was 33.2% in Q3 of '06 from 33% in Q206 whereas Sunsilk grew from 11.6% in Q206 to 12.4% in Q3.

In value terms, growth in shampoo sales for Q306 has been 48.4% (compared to Q305) compared with 47.5% in Q2. In volume terms, there has been an increase of 1% each quarter in the rate of growth which is pegged at 53.6% for Q3 '06.

CavinKare, another major player in this market with brands Chik, Nyle and Meera has a market share of 22% as of November '05.

“In terms of individual marketshare, Chik being our largest brand has a marketshare of 19%, followed by 2% and 1.3% for Nyle and Meera, respectively,” said KS Ramesh, CEO, CavinKare. “As far as the growth rate is concerned, Chik is growing at 23%, Nyle at 1% and Meera at 25%,” he said.

In the shampoo market, 35% of the tonnage are big packs and 65% are the sachets and smaller packs. The smaller packs are more profitable for CavinKare as 80% of the total sales come from this category whereas 20% comes from bigger packs.

“The shampoo category comprises 62,809 tonnes and CavinKare has sold 14,000 tonnes in the past one year,” said Mr Ramesh. P&G has three categories in this market, viz, Pantene ProV, Head & Shoulders and Rejoice under its P&G Home Products segment.

The company's marketshare is 22-25%, as per figures from AC Nielsen. Company officials refused to comment on the growth rate of individual brands.

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