Sucheta Dalal :Godrej Consumer Products to focus on new ‘3x3 strategy’
Sucheta Dalal

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Godrej Consumer Products to focus on new ‘3x3 strategy’  

April 27, 2010

Godrej Consumer Products Ltd (GCPL) has chalked out a new plan for focusing on the international market. It is concentrating on a ‘3x3 strategy’ to penetrate deeper into Asia, Africa and South America, with three product segments—personal wash, hair care and insecticides. 


“It (the 3x3 strategy) is part of our globalisation strategy where we are concentrating on three categories and three continents. We are focussing on these continents to understand the market better. Our strategy always has been to focus on developing countries, because they have high populations. Even consumption of our products is high in these places,” said Hoshedar K Press, vice chairman, GCPL.
The company spent Rs100 crore-Rs125 crore to acquire Tura, a Nigerian beauty products company. This is the company’s third acquisition in Africa. 


In April 2010, GCPL acquired Megasari—a leading consumer products company in Indonesia, which has notched up revenues of $120 million in the past fiscal with estimated profit-after-tax margins of 11%-12%.

It is also the second-largest player in the insecticides market, enjoying 35% market share of Indonesia’s household insecticides market (with a total size of $150 million, growing at 20%). It also has 45% market share (of a total $68 million market, growing at 45%) in the air-care segment and 80% market share of the $21-million wipes market (growing at 45%). Megasari has 15% share of the breakfast cereals market.


 Earlier in October 2005, GCPL had acquired UK-based Keyline for approximately £13 million. During the same year in September, it acquired the South African business of British company Rapidol for Rs50 crore. South Africa-based Kinky Group was bought out for around $34 million in April 2008.


Last year, GCPL acquired a 49% stake in Godrej Sara Lee and is looking to buy out the remaining stake. It has passed an enabling resolution to raise Rs30 billion in order to fund inorganic growth (India and other emerging markets would be key focus areas).


All the big players in the FMCG market are now eyeing Africa. Marico Ltd acquired the ‘Fiancee’ hair care brand owned by Egypt-based Ready Group; Emami is looking at buying an FMCG firm in Egypt. Emami is also looking at buying several other personal care firms in the region and the company is almost certain of having its first manufacturing facility up and running in Africa this year. Emami also has plans to set up three more manufacturing bases in Africa over the next two-three years. — Pallabika Ganguly

-- Sucheta Dalal