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Herbal cosmetics sector to contend with new players

22-January-2005
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Herbal cosmetics sector to contend with new players

The Rs 1,200-crore herbal cosmetics market is expected to witness some action this year. Not only has fast moving consumer goods (FMCG) major Dabur India Ltd (DIL) already made clear its intention to revive interest in this category by launching skincare products, other smaller players are also flexing their muscles to gain a toehold.

J.R. Herbal Care, part of the Rs 300-crore Ahuja Hospitality, has already launched `Jovees' range of herbal products. It is now planning to invest Rs 10 crore in setting up a manufacturing plant besides expanding the existing product range this year. Then, Delhi-based Ozone Ayurvedics has entered the fairness cream market by launching Nomarks fairness cream and on the anvil are several other herbal products. These include an anti-freckle cream and after-shave antiseptic creams.

Says National Head for J.R. Herbal Care, Mr Rakesh Misri, "We are putting up a modern manufacturing plant at Noida. We want Jovees to be perceived as a brand of international quality." Commenting on the keenness shown by smaller companies to enter the herbal cosmetics market, Mr Misri said the category had huge untapped potential.

DIL, which launched the `Samara' range of cosmetics some years ago in joint venture with an Italian company, exited the category due to poor consumer response but has decided to re-enter with skin care products, perhaps after assessing the untapped potential this market holds. While the company contends that Samara was perhaps a brand ahead of its time, targeted at the upper end of the market, it has decided that this time it will enter herbal cosmetics via the value-for-money brand, Anmol.

The fairness cream segment is also in a churn. Dominated by Hindustan Lever Ltd's (HLL) brand Fair & Lovely (which commands 70 per cent market share according to industry estimates), the market has seen a tug of war already between HLL and Ozone. Anticipating stiff competition from existing players, Ozone has earmarked Rs 8 crore for advertising and marketing for the new product over the next few months.

"We launched anti-blemish Nomarks cream two years ago. This product has been upgraded to a fairness-cum-anti-blemish cream," Ozone's Managing Director, Mr S.C. Sehgal, had said earlier. He said `Nomarks' is a Rs 4-crore business and the company has already launched several product extensions after the initial anti-blemish cream was launched. These include an elbow cream, a face wash, two different face packs and a scrub soap.

And while smaller companies are investing resources in building herbal cosmetic brands, they expect sizeable revenues too. J.R. Herbal Care is planning to set up an office in London for exporting Jovees products to European countries within the first year of entering this sector. Ozone Ayurvedics is eyeing Rs 50-crore sales turnover this fiscal against Rs 30 crore it posted in 2003-04.

With established brands, including Shahnaz Hussain's range, Vinita Jain's Biotique and Lotus having already made their mark as herbal alternatives to Lakme and Fair & Lovely, it looks as if the new entrants stand a `fair' chance of success.

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