Personal care products maker VVF is looking at diversification into the food business. The Rs 675 crore (Rs 6.75 billion) company is currently eyeing buyouts in India.
In the past couple of months, the Mumbai-based oleochemicals to personal care company has acquired Colgate's manufacturing facility in Kansas, USA and Teo Corp in Canada. Both these acquisitions have helped the company to increase presence in the personal care space and become a competitive contract manufacturer that caters to private labels in the US.
Piyush Jindal, senior vice-president, personal care, VVF, said the company was on the lookout for acquisitions either in the personal care business or in the foods space.
"If we find brands complementary to our existing personal care products, we would look at acquiring it," he said, adding that foods, both branded staples and processed food was also on the company's radar. The company is said to have considered recent opportunities in both categories, but valuation and market positioning were deterrents.
Internationally, the company is exploring opportunities in the haircare and hair colourants segments. The move for FMCG companies to have a personal care and foods portfolio is not new. Internationally, Unilever and Procter & Gamble have strong food brands like Knorr and Pringles respectively. Even Indian companies like Marico Industries and Cavin Kare have a portfolio of foods and personal care products.
Apart from diversification strategy, VVF
is also planning to broaden its own product range beyond toilet soaps into shower gels, lotions and so on. The company's personal care brands include Jo, Doy and Shiff.
"In personal wash, we are looking at categories like shower gels and hand washes under the Doy Care Aloe Vera brand while in skincare we may launch lotions under Doy Care." said Jindal. These are likely to be rolled out during the next fiscal. He added that all anti-bacterial ranges would be expanded under the existing Shiff brand.
With the acquisition of the Colgate manufacturing facility, VVF will be transferring its North America headquarters to Kansas from Canada.
Jindal said the company would be targeting the hospitality sector in the country by offering a combined basket of personal care and household cleaning products. "Contract manufacturing and private labels for retailers are other categories we will look at tapping in our international operations," said Jindal.
It would also enter new market s such as West Asia, North Africa and Europe through its existing unit in Dubai.
While there are no immediate plans to list the company, this is an avenue the company would consider after a couple of years, said Jindal.
The company is in the process of expanding its capacity and has a new unit coming up in Baddi which will take its capacity from 50,000 tonnes to 75,000 tonnes.
VVF also does contract manufacturing for brands like Dettol, Johnson & Johnson and Imperial Leather.
