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Dabur Profile …

Dabur Profile
Mergers and Acquisitions

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  • 1. DABUR INDIA LTD. Bhargav Dudagadapa Gautam Siddharth1 Vamsikrishna Pedada Ajinkya Patil Eshant Gaur Mohil Poojara
  • 2. DABUR- A COMPANY PROFILE2
  • 3.  Established in 1884, More than 125 years of Trust and Excellence 3rd largest FMCG company in India. Strong Brand Equity  Vatika and Real are Superbrands  Dabur is a household Brand  Hajmola, Real and Dabur Honey amongst Most Admired Brands in India Wide distribution network covering 3.4 Million Retailers across the country. 17 World class manufacturing plants Strong Overseas Presence. 3
  • 4. VISION AND CORE VALUES 4
  • 5. DABUR- HISTORY 5
  • 6. GLOBAL FOOTPRINT 6
  • 7. FMCG SECTOR IN INDIA7
  • 8.  FMCG Industry and its Vibrant growth Rural Sector-Market of the Future FMCG sector is expected to grow at 12-17% upto 2020 and would touch a market value of 4000-6000 billion Rupees- Booz and Company 8
  • 9. POTENTIAL IN FMCG 9
  • 10.  Low penetration levels offers growth opportunity across various Consumption Categories Rural Penetration is low but catching up with the urban levels. 10
  • 11. MARKET LEADERS- FMCG SECTOR 11 Source:: Annual Report Dabur 2011-13
  • 12. DABUR IN FMCG SECTOR 12 Source: Investor Relations report Dabur-August 2012
  • 13. FINANCIALS OF DABUR13
  • 14. FINANCIALS IN BRIEF 14 Source: Investor relations Report—Dabur August 2012
  • 15.  Sales Growth was a combination of volume growth, price increase and marginal transaction gains  Material Costs eased with material costs at 50% of sales in Q1FY13 Vs 52.3% Q1FY12 15Source:Annual Report dabur -2012
  • 16.  Current Market Capitalisation of Dabur (as on 25th September) ::21699 Crores Share Price: 124.65 16 Source:Annual Report dabur -2012
  • 17. BUSINESS STRUCTURE Source: Annual Report 2011-12 17
  • 18. CONSUMER CARE-OVERVIEW Source::Industry Relations Report Dabur August 2012 18
  • 19. CONSUMER CARE CATEGORIES 19
  • 20. 20
  • 21. 21
  • 22. 22
  • 23. OTC AND ETHICALS  Repository of Ayurveda  Range of over 260 products  Strong Distribution Network  Focus on growing OTC Portfolio  Inorganic growth as a way forward 23
  • 24. FOOD BUSINESS 24
  • 25. Health Supplements Hair Care Home Care High Skin CareMarket growth Food Products Oral Care Low Digestive Products High Low 25 Market Share
  • 26. DABUR’S MERGERS AND ACQUISITIONS26
  • 27. INTERNATIONAL BUSINESS  Focus Markets  GCC, Egypt, Turkey, Bangladesh, Nepal, US  High level of localization of manufacturing and sales and Marketing  Sustained Investment in brand building and Marketing 27
  • 28. ACQUISITION OF HOBI GROUP 28
  • 29. ABOUT THE COMPANY 29
  • 30. PRODUCT PORTFOLIO 30
  • 31. COMPANY STRUCTURE 31
  • 32. TRANSACTION Dabur International to acquire 100% stake in three companies in the group:  Hobi Kozmetik  Zeki Plastik  Ra Pazarlama First Overseas acquisition by Dabur Total Consideration = USD 69 million (about Rs 324 crore) 32
  • 33. ACQUISITION RATIONALE 33
  • 34. ACQUISITION OF NAMASTE LABS, USA 34
  • 35. NAMASTE LABORATORIES Founded in 1996 Markets a portfolio of products under the brand ‘Organic root stimulator’ brands Present in the US, and in several other countries in Africa, Middle East, Europe and Caribbean Region of North America Revenue of $93 million for the calendar year 2010 with EBITDA of about $12 million 35
  • 36. TRANSACTION Deal value - $100 million (about Rs451 crore) all-cash deal Dermoviva Skin Essentials – wholly owned subsidiary of Dabur completed the acquisition 100% stake in Namaste Laboratories LLC and its three subsidiary companies —  Hair Rejuvenation & Revitalisation Nigeria Limited,  Healing Hair Laboratories International, LLC and  Urban Laboratories International, LLC along with its South African arm 2nd overseas acquisition by DIL 36
  • 37. RATIONALE Will serve as a gateway to the US market for Dabur’s portfolio of consumer products Enhances profitability Increases stakeholders value Adds to Daburs already strong presence in Africa Daburs entry into the fast-growing USD 1.5-billion ethnic hair care products market in the US, Europe and Africa 37
  • 38. ACQUISITION OF FEM CARE PHARMA LTD 38
  • 39. FPCL Fem Care Pharma Limited was promoted in 1982 Listed on Bombay Stock Exchange since 1994 The company markets bleach, liquid soaps and hair removing creams under the ‘Fem’ brand Distribution reach covering 1,25,000 retail outlets; also covers 25,000 parlours directly Highly profitable company with gross margins of over 60% 39
  • 40. DEAL STRUCTURE DIL has signed an agreement to acquire 72.15% stake from the existing promoters. ™The transaction values FCPL at an equity value of Rs 282.4 crores.™ Dabur to make an open offer to acquire further 20% of the FCPL’s equity share capital.™ Specialty chemicals division and some other investments will be bought over by promoters at book value or market value whichever is higher.™ Acquisition to be funded through internal accruals of Dabur India Ltd. 40
  • 41. RATIONALE Revenue Synergies  Brand provides access to DIL into fast expanding skin care market at mass price points  Higher reach/penetration for FCPL portfolio through DIL’s distribution network  Potential for extending FEM brand into other related skin care categories.  Potential in International markets: FEM & Jaquline brands have presence in GCC/Middle east markets which can be expanded.  FCPL’s parlour outreach to be leveraged for promoting Dabur’s personal care portfolio 41
  • 42. RATIONALE Cost Synergies  Combined business to unlock synergies : Sales & Distribution, Marketing, Supply Chain, Sourcing & Manufacturing  FCPL’s Baddi unit synergistic with DIL’s own skin care plans  Greater efficiencies possible in trade and distribution  Combined Adpro spends can be leveraged to reduce media costs  FCPL’s R&D knowledge in skin care to supplement domain knowledge for DIL 42
  • 43. DABUR ACQUIRES AJANTA PHARMA CAPSULE BRAND 43
  • 44. AJANTA 30 PLUS Launched in 1990 as an herbal energizer capsule Key brand for Ajanta Pharmaceuticals 30-Plus is one of the oldest and strongest health care energizer brands in the country The financial terms and conditions of the deal were not disclosed 44
  • 45. SWOT ANALYSISStrengths Competitive pricing Ayurvedic Repsitory. Strong Brand Image Strong Financially Strong Research and Innovation base. IT baseWeakness No direct Outlets. Seasonal Demands Lack of awareness about Ayurvedic Products 45
  • 46. Opportunities Growing Awareness of Ayurveda Improper and Unhealthy Food habits Growing Rural Markets Growing Middle Class Women and Beauty SectorThreats Allopathic Players; Advertising and Distribution Growing Substitutes. Growing Health Tourism of Kerala. 46
  • 47. FUTURE OF DABUR INDIA47
  • 48. RETAIL STORE ‘New U’ –A retail store for complete makeover of women The brands under NewU includes Dabur’s own private label, NewU, range of affordably priced cosmetics such as nail paints, facial kits and hair accessory among others Rising beauty consciousness. The roughly Rs 7,000 crore organized and unorganized hair and beauty industry is growing at the CAGR of 35%. At this rate, it has the potential to become a Rs-30 ,000 crore business by 2015 Expansion of presence in Retail sector. FDI in Muli-Retail Online Marketing. 48
  • 49. CRITERIA OF M&A Foreign Company/Indian Company Plans to expand/Already established retail player in Beauty Care 49
  • 50. GROWTH IN AFRICAN MARKET Africa Epi-Center of our growt Africa’s real compound GDP growth, about 5 percent annually between 2002 and 2009 Consumer Spending to be boosted by 35% till 2015. New plants in South Africa, Kenya and Nigeria coming up. Products acquired through Namaste Lab and Hoby have to be leveraged in these markets Manufacturing Plants to be set up in Egypt and Nigeria Inorganic growth 50
  • 51. 51
  • 52. RURAL PLANS FMCG Rural rush Low Penetration levels High Demand Revamped Distribution System in 2011. Need Sound logistics systems to supplementCriteria Strong localized logistics system. 52
  • 53.  Expansion of Health Suppliments Expansion of OTC & Ethicals Expansion of Ayurvedic Products 53
  • 54. 54