COMPANY ANALYSIS-DABUR

By,
Sudipta Dhar
Susheel Menon
Tathagata Maity
Venkata Abbia

ABOUT DABUR
1884
1896
Early 1900
1979

Birth of Dabur in Calcutta by SK Burman

Setting Up of Manufacturing Plants
Enters Specialized area of Nature Based
Ayurvedic medicine
Setting up of Sahidabad factory

1986

Public Limited Company

1994
1996

First Public Issue

1997
2000

Food Division

2003
2006

Demerges Pharma Business

2008
2010

Acquired Fem

2012

Crosses Billion Dollar Turnover Market

2014

3 Brands Cross Rs.1000 Cr mark

3 Separate Divisions

Turnover of Rs 1000 Cr

Dabur crosses 2 Billion Market Cap

First Overseas acquisition

ECONOMIC SCENARIO
REAL GDP GROWTH RATE
12.0%
10.0%

IIP Trend

10.3%

6.0%

8.5%

8.0%

6.9%

6.6%

6.0%

5.0%
3.9%

4.0%

7.4%

2.0%

5.1%

4.0%

0.0%

2.0%

-2.0%

0.0%

2.5%

2.6%

0.5% 0.4%

-4.0%

FY 10 FY 11 FY 12 FY 13 FY 14 FY 15

1.7%

-4.2%

-6.0%

CPI and WPI Inflation Trend

7.0%
5.2%

5.6%
3.9%

4.6%
2.4%

1.7%

Aug'14 Sep'14

Oct'14

5.4%

5.2%

4.3%
3.3%
-0.2%

-0.5%

-0.4%

Nov'14

Dec'14

Jan'15

CPI

WPI

Feb'15

Mar'15

-2.1%

-2.3%

2.1%

INDUSTRY SCENARIO
Trends in FMCG revenues over the years
(USD billion)

Consumer Confidence Index-India

103.7

126

123

CAGR
(13%)

34.8 36.8
30.2
24.2
17.8 21.3

121

120

119

129

44.9 46.3 47.3

112

Jan'12 July'12 Jan'13 July'13 Jan'14 July'14 Jan'15

Category Penetration

Urban/rural industry break-up (2015)

2%

Branded Baby Oil

ToothPowder
Rural; 40%

Glucose

47.3
USD
billion Urban; 60%

Toilet Cleaner

Urba
n

22%
13%
10%
12%

45%
56%

Shampoo

72%

Hair Oil

63%

ToothPaste
0%

20%

40%

60%

80%

84%
91%
100%

BUSINESS STRUCTURE
Domestic FMCG
(66%)
Domestic (69%)
Other (3%)

Dabur India Ltd

Organic
International
(22%)

International
( 31%)

Namaste Labs
(6%)

Hobi Group (3%)

** % figures in bracket indicate % share in consolidated sales

for FY15**

SALES BY BUSINESS VERTICAL

Domestic FMCG (Contribution)

Health HP
Care C

Food

HEALTH CARE
( 33%)
Food; 18% Health & Suppliments; 18%

Skin Care; 5% Digestives; 6%

Oral Care; 14%

HOME &
PERSONAL CARE
(48%)

International Sales FY15

OTC & Ethicals; 9%

Home Care; 6%
Hair Care
23%

Domestic FMCG Business

recorded sales of Rs
5383.8 growing by 12.5%

America; 16% Europe ; 12%

Asia; 17%

Middle East; 32%

Africa; 23%

International Business recorded sales of Rs 2422.6 C

growing by 7.6%

18%

6%

9%

#2
Others; 30%
Marico; 42%
Emami; 5%

23%

Bajaj Corp Ltd; 8%

Dabur; 15%

#3

Dabur; 14%

Colgate; 53%
HUL; 33%

14%
Others; 14%
Dabur; 6%
Calvin Klien; 10%

6%
P&G; 24%

5%

#1 In Skin
Lightening
(Bleaches)

HUL; 46%

Others; 8%
Coca-Cola; 5%

Dabur; 5
Pepsico; 37%

MARKET GROWTH DRIVERS

Desire to
experime
nt with
brands

Rising
income
driving
purchase

Governm
ent
reforms
(FDI)
Greater
awarenes
s of
products

Evolving
Consume
r lifestyle

New
Product
launches

FMCG
Growth
Drivers

Growing
rural
market
Growth
of
modern
trade

Increasin
g
discretio
nary
expendit
ure

Increasin
g
consume
r demand

Availabili
ty of
online
shopping

PESTLE ANALYSIS

Political &
Legal

Initiatives like Food Security Bill and direct cash

transfer subsidies reach about 40 percent of
house holds in India
Implementation of GST from April1,2016

Economic

Disposable Income in both rural and urban

population

Social
Environment
al
Technologic
al

Focus on rural markets

Creating a Youth Committee
Increased Awareness among consumers
Rain Water Harvesting & Use of alternate sources
of energy
Modifying boilers
Validation of Carbon Footprint by TUV NORD
carbon services
Stock List Transaction software Drishti has
standardized business processes
Web Based Claim submission System
Use of hand held devices
Using High end & data visualization tool
Emergence of E Commerce

Company Performance
PRODUCTS:

Dabur reported good growth momentum across its key categories and
geographies with both the Domestic FMCG business and the International
Business.
Domestic FMCG Business reported growth of 12.5% during 2014-15.
On the product front, Dabur began the year with the extension of its popular
brand Hajmola, launch of Hajmola Chuzkara.
re-launch of its flagship hair care brand Dabur Amla Hair Oil in a more
contemporary and trendy flip top pack.
The Company launched its iconic health supplement brand Chyawanprash in
a first ever chocolate flavor and other new products.

Company Performance
MARKETS:
Daburs international business contributes to about one-third of
consolidated sales with revenues coming from Middle East , Africa, South
Asia, Europe and Americas.
The International Business recorded sales growing by 7.6%
over previous year.
Key Markets are UAE, Egypt,Nigeria,Turkey,Tunisia,Nepal, Bangladesh
and Sri Lanka.
Innovative products like ORS Edge Control Hair Gel Stick
and Monoi oil range.

Company Performance
BRAND:
Strong brand positioning.
Daburs FMCG portfolio includes five flagship brands with distinct brand
identities Dabur as the master brand for natural healthcare products, Vatika for
personal care, Hajmola for digestives , Real for fruit juices and beverages and
Fem for fairness bleaches and skin care products.
To renew and reconnect the brands the company launched two new initiatives this
year 700 Se 7 Kadam and Brave and Beautiful.

INNOVATION:
Highly experienced R&D. An expenditure of Rs 22.31 Crores was incurred

towards Research and Development during the financial year 2014-2015.

Brand Vatika continued to innovate in the hair care space.
Brand Amla aggressively innovated this year to reinvent its existing offerings.
Other innovative products this year are ORS Edge Control Hair Gel Stick, Monoi
Oil , Hajmola Lapsi.

Company Performance
Received a number of operational excellence awards during 2014-15.
Initiatives towards packaging innovation, quality improvement and
improving safety awareness.
Operations
Safety and care for environment.

Over 6000 employees across the globe.

Human Various strategic learning programmes,employee engagement and health
Resource management initiatives for overall development of the employees.

IT initiatives in Sales @Dabur are anchored under Projects

Disha,Project 50/50.
Technolog
Efforts were made for technology absorption.

Company Performance
Supply
Chain

The business follows a localised supply chain strategy.

Emergence of e-commerce as an important new channel.
Dabur supply chain was awarded the Best supplier award for
the year from one of the largest customers in Organized retail.

Manufacturing plants in 12 locations in India.

90% of the products are manufactured in company owned units.
Manufacturi
Manufacturing capacity has been increased in UAE and Egypt.

ng

Financial Performance
Profit and Loss

PBDIT and PBIT (in Crores)

Net Sales (in Crores)

6000
5000
4000
3000
2000
1000
0

5419

2014-15

4856

2013-14

1,000
900
800
700
600
500
400
300
200
100
0

4334

915

849

1000
800

977
763

672

600

750
591

4.00
PBT
PAT

200

0.00
2013-14

2012-13

2012-13

4.35

3.85

3.39
EPS

2.00
1.00

2014-15

2013-14

3.00

400
0

681

EPS(in Rs)
5.00

861

754

PBIT

PBT & PAT (in Crores)

1200

771

PBDIT

2014-15

2012-13

825

2014-15 2013-14 2012-13

CAGR
Particulars

CAGR %

Net sales

7.65

PBDIT

6.6

PBIT

7.52

PBT

9.12

PAT

8.78

EPS

8.58

Balance Sheet (figures in Crores)

Net Fixed Assets
Investments - long term
Current Assets
a

Short term investments

Other current assets

Current Liabilities
a

Short term borrowings

All other current liabilities

Working capital
Capital employed
Net Worth ( Shareholders funds)
Share capital + Reserves & Surplus
Total debt

2014-2015

2013-2014

2012- 2013

694.74

670.38

633.65

1,421.30

569.60

456.85

371.17

563.67

494.44

1,201.15

1,318.23

1,242.95

129.13

44.29

240.74

1,129.90

1,092.39

917.70

71.25

225.84

325.25

2,558.46

2,029.49

1,910.19

2,336.19

1,902.34

1,594.78

222.27

127.07

315.41

Ratios
2014-2015
Debt/Equity
Interest coverage
PBDIT/Net Sales
PAT/Net Sales
Net Sales/Capital
employed
Capital
employed/Net
worth
PAT/Net Worth
Net
Sales/Working
Capital

2013-2014

2012-2012

0.10

0.07

0.20

5.96

2.11

2.56

16.88%

16.98%

17.41%

14.07%

13.84%

13.64%

212%

239%

227%

110%

107%

120%

0.33

0.35

0.37

76.06

21.50

13.33

Market Price Related

Market Price/share(in Rs)
300
250

Book value/share (in Rs)

268

200
150

179
138

100
50
0
2014-15

2013-14

2012-13

14
13
12
10
8
6
4
2
0
2014-15

P/E
25
20
20

60 62
46

41

40
30

2012-13

16

15

15
10

20

10
0
2014-15

2013-14

P/B

70
50

11

2013-14

2012-13

0
2014-15

2013-14

2012-13

SWOT
STRENGTHS
ANALYSIS WEAKNESS

1. Strong brand image,

Dabur has its own heritage,
it is more than 100 years old
2. It has presence in around
60 countries, distributed
through 5000 distributors
and 2.8 million outlets
3.
The
product
length
includes
around
300
prescribed products

1. Seasonal demand of
products
2. Low penetration.
3. Stiff competition from
big
domestic
and
international brands
4. Limited differentiation

OPPORTUNITIES
1. Export opportunities.
2.Creating
additional
consumption pattern
3.
Growing
womens
earning power
4.Ayurveda as a field is
receiving
much
more
attention across the world

THREATS
1Existing competitors like
baidyanath,
himalaya,
zhandu, keokarpin.
2. Other fields of medicineAllopathic, Homeopathic

ORGANIZATIONAL
INTELLIGENCES
Innovativ
e
Intelligen
ce localized
offerings
specific
to the
region

Launch of
Hajmola
Chuzkara

Communica
tive
Intelligence
Launched a
mega
model hunt,
Fem Miss
North India
Princess
2014
Occasionbased
communica
tions.
Celebrity
Endorseme
nts

Analytical
Intelligence-

Operational
Intelligence-

Acquisition of
US based
personal care
firm
Namaste
group

packaging
innovation,
quality
improveme
nt.
optimal mix
of
manufacturi
ng facilities
at different
locations
90% of
products
are
manufactur
ed at
Companyowned units

In fiscal
2011-12,
Dabur had
acquired the
Thirty-Plus

Visionary
Intelligen
ce Projecting
ayurveda
as
mainstre
am.

MAJOR STRATEGIES IN THE LAST 3 YEARS

They decided to refurbish product portfolio and enter emerging

categories such as skin care, packaged fruit juice and toothpaste.
Dabur plans to have all of its business units around the world fully
supported by the shared-service center
Dabur decided to establish manufacturing facility abroad, rather
than ship products from India.
Project CORE was rolled out to extend the reach in Chemist
outlets across top 140 towns
Under Project 50/50 the grocery channel teams have been
segregated to focus on wholesale & retail separately.
The thrust on rural markets through Project Double continued,
improving rural reach to 44128 villages.
All the IT initiatives in Sales @ Dabur are anchored under Project
DISHA
Dabur has put in place a dedicated E Commerce team to tap the
opportunity.
With a continued increase in the number of Internet users, Digital
Media being leveraged for brand building and consumer connect

THANK YOU