Cosmetics and personal health-care products company Emami Ltd, which is diversifying into non-core areas, has set its sights on real estate.
KOLKATA: Cosmetics and personal health-care products company Emami Ltd, which is diversifying into non-core areas, has set its sights on real estate.
It has set up a subsidiary, Emami Realty Ltd, and has identified 10 projects comprising four IT parks, three shopping malls and residential complexes in Kolkata, Coimbatore and Hyderabad. The project involves the construction of over 50 lakh square feet.
The real estate foray forms part of Emami’s larger plan to raise 70% of its revenues from non-FMCG areas in a few years.
At present, almost 50% of its revenues come from the core business of cosmetics and personal health-care products. The group, however, is still keen on acquisitions in the FMCG sector.
Citing realty as one of Emami’s new major initiatives, chairman R S Agarwal said during the company’s annual general meeting here on Tuesday, “Realty has been another potential business opportunity. With Emami’s resources, it can easily take these opportunities.
Apart from using Emami’s liquid resources, it would also give the realty business an independent and separate focus since it would be a 100% subsidiary of Emami Ltd. While aggressive growth in the FMCG business continues, realty would further enhance profitability and shareholder’s wealth.”
The Emami Group has lined up investments of almost Rs 3,500 crore in the next 3-4 years for its paper, hospitals, retail, real estate and more recent cement and bio-diesel business. It feels returns from industries like paper or cement comes much faster compared with FMCG. Thus, the segment will see investments of around Rs 125 crore this year.
The group’s latest initiatives have been geared on its cement and bio-diesel venture. It is planning to set up a second bio-diesel plant in Haldia in West Bengal after the first one is commissioned by November-December this year.
In FMCG, the company’s fastest moving brands have been Navaratna oil, Boroplus Antiseptic cream, Mentho Plus Balm and Fast Relief, Sona Chandi Chyawanprash and Boroplus Prickly Heat Powder and Fair and Handsome.
The company has extended its network to 2,600 distributors and 4 lakh retail outlets.
“Collaboration with ITC e-choupals and the postal department of Maharashtra is being explored for a wider distribution. Moreover, 8,000 Emami mobile traders and 400 Emami small village shops are conducting direct rural marketing in West Bengal, Chattisgarh, MP, Andhra, Orissa, Assam and Karnataka, covering 7.8 lakh households,” Agarwal said.
For increasing exports in FMCG, the company has developed specific brands like Emita, Ayucare and a Gold range of products catering to specific markets and consumers.
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