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Bajaj Consumer Care Ltd.

BSE: 533229 Sector: Consumer
NSE: BAJAJCON ISIN Code: INE933K01021
BSE 00:00 | 24 Apr Bajaj Consumer Care Ltd
NSE 05:30 | 01 Jan Bajaj Consumer Care Ltd
OPEN 151.10
PREVIOUS CLOSE 151.55
VOLUME 23649
52-Week high 353.50
52-Week low 117.50
P/E 9.47
Mkt Cap.(Rs cr) 2,145
Buy Price 145.00
Buy Qty 10.00
Sell Price 147.80
Sell Qty 1.00
OPEN 151.10
CLOSE 151.55
VOLUME 23649
52-Week high 353.50
52-Week low 117.50
P/E 9.47
Mkt Cap.(Rs cr) 2,145
Buy Price 145.00
Buy Qty 10.00
Sell Price 147.80
Sell Qty 1.00

Bajaj Consumer Care Ltd. (BAJAJCON) - Chairman Speech


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Company chairman speech

Dear Stakeholders

I have great pleasure in presenting the Annual Report of the company for the financialyear 2018-19.

Macro-Economic Outlook

Despite several global headwinds the Indian economy achieved stable growth mainly onthe strength of ongoing structural reforms. However the year also witnessed significantvolatility in crude and currency movements. The rupee was under constant pressure anddeclined considerably on account of rising crude oil prices and strengthening of dollardue to higher fed rates. The consumer price inflation was within comfortable zone despiteelevated crude oil prices during most part of the year. India continued to improve itsranking in the ease of doing business and is continuously emerging as an important playerin the world economy. The recent landslide victory of the BJP government and thecontinuous pace of bold reforms is further expected to strengthen the growth prospects ofthe economy though global challenges due to emerging trade tensions need to be assessed.

New brand identity

At the beginning of the year we had initiated an exercise in corporate brand buildingto enable us to create a more unified group brand and align our various businesses to ashared brand identity. With the help of a globally renowned brand strategy and designcompany we unveiled a new brand identity for the organization. This includes a newcorporate logo and renaming the Company as "Bajaj Consumer Care Limited" withmore focus and purpose towards "why we exist in the marketplace". This has alsohelped us to realign ourselves as an organization which "Thinks Tomorrow". Ournew Vision now is "To harness our heritage of 90 years and combine it with leadingedge scientific knowledge to bring innovative products for consumers across the world tohelp them get more out of life".

Company performance

The overall performance during the year was satisfactory and for the first time inhistory we crossed the operating revenue of Rs. 900 crores on a standalone basis with agrowth of 9.4% compared to the previous year. The EBITDA for the year has been 284 Croreswhich is a very healthy 32% of our sales. This is despite rising cost of two key rawmaterials viz. light liquid paraffin which is directly linked to crude oil and mustardoil. The cost of other raw and packaging materials like perfume and glass bottles alsowitnessed upward revision. However by proactive purchases and selling price increases wewere able to contain the rise in cost of goods sold and thereby mostly retaining ourmargins. Continuing with our practice of rewarding shareholders we have paid a handsomedividend of 1400% during the year under review.

Brands

Bajaj Almond Drops Hair Oil

For the first time in 25 years Bajaj Almond Drops our iconic hair oil brand witnesseda brand new packaging. We hired a UK based design agency to help design the biggest changein its history. The brand has moved on from its classic color palate to a premium pearlmaroon and gold combination. The bottle design is sleeker and label taken an almond liketactile effect. The brand re-launch has been very successful and has resulted in marketshare as well as penetration gain. The value market share in light hair oil went up to 64%and the performance of the brand in the total hair oil segment touched an all-time high of10%. This rise in market share has been driven by increase in household penetration. Thepenetration of Bajaj Almond Drops has gone up from 17.6% to 20.1% which is an impressiverise of 2.5% in penetration within one year. The brand's new look is a crucial step forthe brand and it aims at targeting the new age consumers & build on its key imageryattributes of lightness nourishment & premium feel in an environmentally sustainablemanner. In the last quarter of the year we also launched ‘Bajaj Cool Almond Drops'in a cooling hair oil segment have been well received in the market.

Nomarks

The other brand we relaunched during the year was ‘Nomarks' which is showingpositive result. On a company level the brand has shown an impressive growth of 14% on anannual basis. The market share of the brand in anti-marks category continues to do welland is currently at 8.6%. We also launched ‘Bajaj Nomarks Sunscreen' in the ayurvedicanti-marks sunscreen category during the last quarter of the year.

Distribution

Distribution is one of the strengths of your company and we continued our focus onfurther improving it by implementing latest technologies to improve efficiencies of salesforce. Today our brands are distributed through a network of more than 7000 stockistswhich covers about 4 million retail outlets in the country. We are committed to furtherinvest in distribution and increase penetration and availability of our brands on theshelf.

Strategy

In order to achieve full potential of our leading brand ‘Bajaj Almond Drops hairOil' we have engaged the services of Bain & Company (Bain) the renowned globalManagement Consultant. Bain will help us in formulating a front-end strategy for growthand help in implementing it. It will help to grow our hair oil brands faster. They will beusing their well respective BBA or Bain Brand Accelerator model to guide us towards fastergrowth. The preliminary aspect of what we wish to achieve was presented at the investorsmeet held on May 6 2019 at Mumbai.

Responsibility towards Society

Your Company undertakes its CSR activities through the bajaj Foundation and has thevision of "Integrated development of the society through participatory approachesthat sets benchmarks and standards for others to emulate for sustainabledevelopment". We strive to empower rural communities to take charge of their owndevelopment in a participatory manner by developing and managing natural and humanresources. Community development interventions focus on water resources development andstrengthening agro based livelihoods. Bajaj Foundation also promotes alternate agro basedlivelihood opportunities such as dairy farming natural farming horticulture developmentwomen's empowerment through formation of their self-help groups promoting farmers'producers companies climate proofing projects and biogas which not only providesadditional steady income but enhances the quality of life of the rural community.

I wish to thank our villagers government agencies and all stakeholders for theirsupport which has ensured that we now reach 1120 villages benefitting 2.10 lakh familiescovering 10.38 lakh people in Wardha (Maharashtra) and Sikar (Rajasthan) districts to makethem socio-economically prosperous districts.

Employees & organization culture

The Company is continuously striving to attract the best talent enhance employeeexperience and improve employee retention. With the objective of being a great employerwe have conducted a cultural assessment through Egon Zhender an HR consultancy firm ofinternational repute to help us evolve an industry best employee friendly workingculture. I am further delighted to share that your company has now been certified as GreatPlace to Work for building a high trust and high-performance culture.

Way Forward

We challenge the status quo every day to constantly change grow and surge ahead withan eye on creating a brighter tomorrow. We aim to create an organization which is futureready system driven and create value for our stakeholders. We will continue to strive foroperational efficiencies through automation and effective system and process improvement.We remain committed for profitable and sustainable growth in years to come by upholdinghighest level of corporate governance and integrity.

With warm regards

Kushagra Nayan Bajaj