I N V ESTOR PRESEN TAT I ON FEBRUARY 2 0 1 7
DABUR OVERVIEW One of the oldest and largest FMCG Companies in the country World’s largest in Ayurveda and natural healthcare Total reach of 6mn outlets, one of the highest among FMCG companies 19 world class manufacturing facilities catering to needs of diverse markets Strong overseas presence with 32% contribution to consolidated sales 1.
STRONG FINANCIAL PROFILE In INR Bn 84.4 78.1 PAT PAT margin (%) 14.8% 70.7 12.5 13.7% 1,300 16.0% 61.5 12.9% 10.7 12.4% 12.2% 14.0% 52.8 1,100 9.1 12.0% 900 7.6 6.5 10.0% 700 8.0% 500 6.0% 300 4.0% 100 2.0% -100 0.0% FY12 FY13 FY14 FY15 FY16 FY12 FY13 FY14 FY15 FY16 EBITDA EBITDA margin (%) 20.6% 2,000 25.0% 17.4 18.9% 1,800 18.2% 17.9% 17.8% 14.7 1,600 20.0% 12.9 1,400 10.9 1,200 15.0% 9.5 1,000 800 10.0% 600 400 5.0% 200 0 0.0% FY12 FY13 FY14 FY15 FY16 2. *includes Non- Operating income
STRONG FINANCIAL PROFILE 52.5% 41.6 45.2% 43.6% 38.3% 33.5 34.0% 26.6 21.0 17.2 FY12 FY13 FY14 FY15 FY16 FY12 FY13 FY14 FY15 FY16 7.1 6.1 5.2 4.4 3.7 FY12 FY13 FY14 FY15 FY16 3.
KEY MANUFACTURING FACILITIES Baddi, Himachal Pradesh Pantnagar, Uttaranchal Sahibabad,Uttar Pradesh Jammu, J&K Silvasa,Dadra & NagarHaveli Alwar, Rajasthan Pithampur,Madhya Pradesh Katni,Madhya Pradesh Narendrapur,West Bengal Siliguri, West Bengal Newai,Rajasthan Nasik,Maharashtra Sri Bangla UAE Egypt Nigeria Turkey Nepal Lanka desh 4.
DISTRIBUTION FRAMEWORK We reach to 6mn Outlets Factory Factory C&F C&F GT Stockist MT Stockist Insti Stockist Super Sockist Wholesaler Sub Sockist Retailer Retailer Retailer Consumer Consumer Consumer Consumer 5.
DISTRIBUTION EXPANSION • Rolled out in FY13 to expand direct coverage in rural markets • Direct Village coverage has increased from 14000 villages in FY11 to 44,000 villages in FY15 • Focus on increasing efficiency and productivity of the channel • Aimed at leveraging the potential of Top 130 towns which contribute to 50% of urban consumption • Segregating the grocery channel teams for wholesale & retail • Initiative is in line with renewed focus on urban markets • To enhance chemist coverage and provide further impetus to our Health Care portfolio • Direct Chemist Coverage is currently 213,000 • Strategy is to increase coverage and range for better throughput 6.
DISTRIBUTION INITIATIVES Focus on enhancing field efficiencies • Inducted around 1000 Village salesmen on company rolls • Increase the outlet coverage per SSM Increasing Direct Reach • Near term target to increase direct reach to 1 mn outlets Product Focus • Rural Focused Product Mix • Innovative launches in Urban Capability enhancement through training and IT enablement Focus on alternative channels- Increased role of Modern Trade,Cash & Carry and other channels 7
WHAT IS AYURVEDA? “ Ayurveda is the traditional system of healthcare which promotes PREVENTION FIRST and CURE NEXT Ayurveda is based upon Natural Remedies which incorporate the healing properties of plants and herbs. 8.
SALIENT FEATURES OF AYURVEDA Ayurveda heals by activating the natural inherent curative force of the body It believes in It is holistic and complete cure and cures the patient not only control of as a whole and not signs and the symptoms of symptoms disease alone It believes not only It gives more in restoration of stress on why is Health, but also the problem rather the dynamic than what is the internal balance problem Being natural, it’s relative safety is better than conventional chemical drugs 9.
AYURVEDA IS WELL REGULATED IN INDIA Ministry of AYUSH ( A yurveda, Y oga, U nani, S iddha & H omoeopathy ) Ayurvedic Education is controlled by CCIM - 1970 Act ( C entral C ouncil for I ndian M edicine ) Under Ministry of Health & Family Welfare Govt. of India 10.
11. DABUR & AYURVEDA
CLAIM BASED COMMUNICATION Double immunity 2X faster physical growth Clinically proven formula Clinically proven formula Stay fit, feel young 12.
PROMOTING AYURVEDA: DOCTOR REACH Directly reaching • Detailing and Product 32000+ sampling Connecting Engaging Doctors Collaborating Promoting Association with 50 + Ayurvedic Colleges Key Opnion www.dabur Leaders mediclub.com 13.
DABUR BUSINESS STRUCTURE Domestic FMCG (65%) Domestic (68%) Dabur India Ltd. Others (4%) Organic International (22%) International (32%) Namaste Labs (6%) Hobi Group (3%) * Others include Retail, Commodity exports etc Note: % figure in brackets indicate % share in Consolidated Sales for FY16 14.
INDIA BUSINESS 15.
SALES BY BUSINESS VERTICAL Domestic FMCG* Healthcare HPC Foods (33%) (49%) (18%) Health Supplements 18% Foods 18% Skin Care Digestives 5% 6% Domestic FMCG* Business Breakdown Oral Care OTC& Ethicals 15% 9% Hair Care 23% * Breakdown of Domestic FMCG business basis FY16 Sales Home Care 6% 16.
MARKET LEADER IN 6 CATEGORIES #Relative Competitive Position #1 #1 #3 #2 #2 #1 #2 #1 #1 #1 #2 Home and Personal Care Foods Healthcare * Position basis Nielsen Market Share data MAT Dec’16 17.
BUSINESS STRATEGY Healthcare • Leadership in Ayurveda – scientific evidence & research • OTC portfolio to be scaled up through innovation & awareness creation • Doctor advocacy through Medico Marketing channel Home & Personal Care • Ayurvedic / Herbal focus • Premiumization & Differentiation • Strong innovation agenda Foods • Maintain leadership in Juices & Nectars category • Leveraging the Fruit equity associated with the ‘Real’ brand • Focus on Healthy range of products 18.
19. BUILDING CONSUMER CONNECT
20 FOCUS ON INNOVATIONS
21. 16 brands with turnover of INR 1bn+ with 3 brands over 10bn CONTINUE TO BUILD BIGGER BRANDS
MOST TRUSTED BRANDS • Dabur Red Paste and Dabur Hajmola – have been ranked amongst the biggest gainers in the latest Brand Equity Most Trusted Brands List • Dabur Red Paste moved up 66 places and was ranked 34 in the Brand Equity Most Trusted Brands 2016 list, released by The Economic Times, up from its ranking of 100 in the previous year • In the Oral Care category list, Dabur Red Paste took the third place , a gain of one rank from the previous year. The year 2016 had seen Dabur Red Paste also break into the Top 3 in the market, becoming the third largest toothpaste brand in the country. • Hajmola gained 38 places and was ranked 85 in the list. The brand was also ranked in the Top 5 in the OTC category for 2016 22.
DEMONETISATION Personal and Home Medicines Impulse and Non essentials Grocery and Food care like biscuits, chocolates, essentials Soft drinks, snacks, packaged food Least Highest Impacted Impacted 23.
MONTHLY TREND: CATEGORY GROWTH On account of demonetization growth for Personal Care categories like Shampoo, Hair Oil and Toothpaste decelerated sharply in Dec’16 to almost half of Nov’16 levels Volume Growth Hair Oil Shampoo Toothpaste July'16 Aug'16 Sep'16 Oct'16 Nov'16 Dec'16 Source: December Retail Audit Report, AC Nielsen 24.
KEY INITIATIVES BY DABUR Increased focus on Modern Trade, Institutional and E-Commerce channels Extended credit to trade on selective basis and helped increase digitization Destocking and improving the channel hygiene Adjusting the portfolio to market needs and sharper focus on category/ channel/ product 25.
INTERNATIONAL BUSINESS 26.
BUSINESS OVERVIEW 27121 In INR Mn 24226 23108 Dabur International(FY16) 18338 16161 Organic Inorganic Business(70%) Business(30%) FY12 FY13 FY14 FY15 FY16 • Saudi Arabia, UAE Middle East Americas • Egypt, Nigeria, Kenya, South Africa 17% Africa Europe Middle East 11% • Turkey, UK 33% Europe Asia • Nepal, Bangladesh, Pakistan Asia 17% Africa 22% • USA America 27.
THE JOURNEY… 2015-2018 2011-2014 2007-10 2003-2006 • Enter into African Markets • Hobi and Namaste • Expand portfolio acquired which led to • Cross pollinate • Entry into Personal geographic expansion ideas and leanings • Innovative product Care segments from different units • Manufacturing offerings 2002 • Management locations expanded • Franchisee bought • Systems and bandwidth expanded out and renamed processes Dabur International implemented • Portfolio expansion beyond Hair Oils • Focus on building • Trading Model demand through a franchisee • Hair Oil was mainstay • No localization 28.
ORGANIC INTERNATIONAL BUSINESS Styling & Others Oral Care Hamamzaith 5% 2% 12% Hair Skin Care Cream 7% 13% Shampoo 14% Hair Oil 39% Oral Hair Oil Care Others 93% 11% 4% The Organic International Business has evolved from being just a Hair Oil business to a diversified personal care entity 29.
30. RECENT INNOVATIONS
31. NAMASTE: FOCUS ON ‘NATURAL’ OFFERINGS
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