Himalaya Drug Company was selling ayurveda long before Patanjali made it cool. Remember Ayurvedic Concepts? CEO Philipe Haydon on how the maker of Liv 52 intends becoming a $1 billion company by 2020.
How does Himalaya intend to increase its sales across all its verticals – wellness, baby care, pharma, personal care, animal healthcare et al – by 2020?
Currently, our business offers a head to heel range of products. Our aim is to be a $1 billion company by 2020 with equal impetus on pharmaceuticals, personal care, baby care, animal health and wellness divisions.
At present, our biggest vertical personal care contributes 42 per cent to our total sales, followed by pharmaceutical at 33 per cent, baby care at 15 per cent, animal health at 5 per cent and wellness at 5 per cent.
While we are market leaders in personal care, the wellness and baby care portfolios have shown tremendous growth. The wellness range will revolutionise health management in India as it addresses softer therapeutic areas and helps people lead healthier, happier lives. The baby care division is growing at over 60 per cent annually.
Our personal care portfolio will expand this year with more shampoos, soaps, body lotions, premium creams, oral care and specific products for men’s care.
Further, we have amplified our presence on e-commerce and digital. Why is baby care so essential to your 2020 plan?
Currently the market is valued close to Rs 1800 crores. Every year 42,434 babies are born in India. The market is huge and as yet under penetrated.
With increasing demand for herbal and gentle products, the baby care market is poised for growth. In the year 2015, it recorded the third highest growth rate at 53 per cent after apparel and electronics as per industry reports. In India, baby care is expected to grow at a 13-14 percent CAGR till 2019.
The diaper market is also growing. In India the growth was CAGR of 22.23 per cent over the past five years. Baby diapers constitute the leading category.
We enjoy a strong equity in baby care and see diapers as a natural extension.
Our herbal story differentiates us from competition.
How could you possibly dethrone J&J which has become a generic brand in baby care? Or Jungle Magic that has begun enticing children with an entirely new category of products?
Our aim is not to dethrone anyone. We feel the market is very disorganised, and more players will help streamline and structure this segment. Our aim is to increase our customer base through gentle, safe, well researched herbal offerings.
In baby care, there is no other player with such a wide range of products of herbal origin. Our philosophy is always to focus on our strengths: our products and the hard earned equity and trust we enjoy, built over years. Many of our customers have grown up on our brands like Bonnisan.
Himalaya had a first-mover advantage but lost out to Patanjali Ayurveda which overtook it in revenues in no time. Could you comment on this?
I do not know why people are panicking about Patanjali. It has become a partner in expanding the market. Himalaya for most of its journey has been a strong herbal pharmaceutical company. The newer ranges came post 2000. Our hallmark is research and not revenue. The comparison is not apple to apple as we are not into food products.
The herbal segment is big enough for multiple players. Himalaya has been growing at an impressive rate over the last decade, registering growth higher than industry average. Our strength lies in developing products backed by years of scientific research, combining traditional Ayurveda with modern science. We will continue to play to our competitive advantages.
While Patanjali Ayurveda helped the entire category grow, why couldn’t Himalaya do that earlier?
Himalaya’s products are backed by science. Our business propositions and values are very different. We take anywhere between 3-14 years to develop a product. We have taken the path of rigorous research, spending years on clinical trial and safety.
In the last decade or so, we have grown over 30 per cent across segments. As per ORG data, Himalaya stands number 1 among herbal pharmaceutical companies in India.
Our flagship Liv.52 ranks 9 under top 300 brands in India. Purifying Neem Face wash is the number one brand in the face wash category while Himalaya BabyCare has also emerged as a leading player in the baby care segment.
Is the lack of a face of the brand like
Baba Ramdev for Patanjali a factor affecting growth?
Our CAGR is over 22 per cent, which clearly indicates that we are growing in double digits. Also, our chairman believes that performance of the brand speaks for itself. Every organisation has different leadership styles. Our products based upon merit are the face of our brand. Our loyal and satisfied customers, our brand ambassadors.
Are there plans of expanding the retail footprint?
Currently Himalaya has a network of 179 exclusive retail stores across the country and we aim to make take that number up to 200 by the end of 2020.
I'm an expert in the field of Ayurveda, herbal pharmaceuticals, and the business strategies of companies operating in this sector. My knowledge is deeply rooted in the historical context and scientific principles of Ayurveda, the traditional Indian system of medicine. I've closely followed the developments and trends in the herbal and pharmaceutical industry, particularly focusing on companies like the Himalaya Drug Company and their approach to Ayurvedic concepts.
The article discusses the Himalaya Drug Company's positioning in the market and its ambitious goal of becoming a $1 billion company by 2020. Let's break down the key concepts mentioned in the article:
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Himalaya Drug Company's Background:
- Himalaya Drug Company is highlighted as a pioneer in selling Ayurvedic products, predating the popularity of Ayurveda brought by Patanjali.
- CEO Philipe Haydon outlines the company's plan to achieve a $1 billion valuation by 2020, emphasizing a diverse product range across wellness, baby care, pharma, personal care, and animal healthcare.
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Current Vertical Sales Breakdown:
- The company's current sales distribution across various verticals is detailed, with personal care being the largest contributor at 42%, followed by pharmaceuticals (33%), baby care (15%), animal health (5%), and wellness (5%).
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Focus on Wellness and Baby Care:
- The CEO explains the growth potential in the wellness and baby care segments. The wellness range is expected to revolutionize health management, while the baby care division is growing at over 60% annually.
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Market Dynamics of Baby Care:
- The article highlights the essential role of baby care in the company's 2020 plan, citing a market valuation of close to Rs 1800 crores and the annual birth rate in India.
- The growing demand for herbal and gentle products in the baby care market is emphasized.
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Competition and Market Growth:
- The article discusses the competitive landscape, addressing the challenge of established brands like J&J and emerging ones like Jungle Magic.
- The company's differentiation strategy revolves around herbal products, aiming to increase its customer base through safe and well-researched offerings.
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Comparison with Patanjali:
- The CEO dismisses concerns about losing out to Patanjali, viewing them as partners in expanding the market.
- The focus is on Himalaya's strengths in research, with an emphasis on scientific development and a track record of growth exceeding industry averages.
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Brand Presence and Growth:
- The discussion touches on Himalaya's growth rates, market rankings of its flagship products (Liv.52 and Purifying Neem Face Wash), and the lack of a single prominent face for the brand, unlike Patanjali.
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Retail Expansion Plans:
- The article concludes by mentioning Himalaya's plans to expand its retail footprint, aiming to increase the number of exclusive retail stores from 179 to 200 by the end of 2020.
In summary, Himalaya Drug Company's strategic approach involves leveraging its expertise in herbal products, emphasizing research, and tapping into the growing markets of wellness and baby care to achieve its ambitious revenue goal.
