With volatile raw material prices and foreign exchange rates leaving little room to raise dry-cell battery prices, Eveready is working on a strategy to become a more brand-driven company, where it would not have to think much before taking a price hike.
The battery maker company, already a big brand to reckon with, would gradually move away from
dependence on battery categories targeted at the rural markets, where even minor price hikes affect volumes.
Instead, it is looking to introduce more and more battery guzzling products with much higher unit value.
“We are no longer looking at raising market share in traditional market, but looking at improving profitability. Anything that can bring Eveready back on top of mind can enhance our ability to take price increases,” Amritanshu Khaitan, director, Eveready, said.
Eveready’s profitability, dependent to a large extent on forex movement, has been under stress as a large number of raw materials including zinc and also the finished products it markets are imported.
“We have been taking price increases. Battery prices were hiked 3-4% over the past six months and we would take further hikes as the impact of raw material costs increases hasn’t been passed on yet,” Khaitan said.
The push towards reinventing brand Eveready has began with the launch of a universal charger, under its existing brand Ultima, for smartphones and tablets targeted at the youth.
Priced Rs1,200-3,000, Eveready would now have such products in its portfolio where minor price hikes would mostly go unnoticed.
More such youth-centric gadgets would be introduced in coming months as also urban lighting solutions.
All this, Khaitan believes, would result in better margins and profitability in near future.
“Our operating profit margin for the whole of this year is expected to be in the region of 7% compared with 4.5% last year.”