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Wipro Consumer Care Eyes Africa For Growth

News From : DagangHalal.com (26 Aug 2009)

BANGALORE: Wipro Consumer Care and Lighting (WCCL), which forayed into the international personal care market by snapping up Singapore-headquartered Unza Holdings, is training its focus on east and west African countries to increase Unza’s base this fiscal.

WCCL is expanding its go-to market strategy, hyping up marketing spends and re-energising Unza’s portfolio to ramp up market share at a time when competition is pulling back.

Two years after the FMCG division of IT major Wipro acquired Unza for $246 million, the acquisition reported revenues of Rs 882 crore in FY09. Unza’s net revenues jumped 26% last fiscal, beating industry growth in developed markets such as Malaysia and Singapore which was 1-3 % and Vietnam at 8-10 %.

“Unza’s presence in Nigeria and Egypt has helped us understand the potential for premium products in the east and west African countries. We will target locally-relevant products within such high-growth markets ,” Vineet Agrawal, president WCCL, said.

Unza’s portfolio includes women’s toiletry brand Enchanteur, which accounts for 30% of revenues, men’;s brand Romano as well as Halal toiletry brand Safi. Unza is the third largest player in personal care in Vietnam and Malaysia but currently has a limited modern trade presence in India.

Halal toiletries are products devoid of alcohol and animalderived emulsifiers. Though markets such as Singapore and Hong Kong are dominated by modern trade – accounting for robust 70% – WCCL has used its domestic expertise to build up its general trade presence. As consumers avoid discretionary spends, their frequency of shopping at general trade outlets has increased. Unza expects to gain by positioning the lowerend and smaller units of its premium portfolio through this channel overseas.

Post acquisition, the rising raw material prices prompted the company to shift to common sourcing from China and automation across its five south-east Asian manufacturing units. This quarter, it will infuse funds towards revitalising and repackaging few brands. “We expect discretionary spends to go up over a period of time and want to have the first share in it,” liaison director of Wipro Unza, Kumar Chander, said.

WCCL had livened up overseas marketing spends by around 30% in FY09 to push growth even in slowing markets . “More than sheer increase in advertising, we have restructure our spends from targeted below-the-line activities at the store level to more mainstream advertising channels this fiscal. This is focused on increasing demand even in smaller towns,” Mr Agrawal, added.

In the first quarter of FY10, Unza’s volumes grew 13% to Rs 231 crore as Vietnam led the pack growing 45%, followed by China and Indonesia.

Source: The Economic Times

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