A prominent pest management company Hicare was founded by Godrej Industries in 2004. It was later acquired by ISS a Danish multinational in 2009 post which True North (formerly known as India Value Fund Advisor) picked up a controlling stake in the company in 2014. Interestingly, FMCG industry veteran A Mahendran (formerly with Godrej Consumer Products) is also non-executive chairman of the company with small shareholding in his individual capacity. The brand which has been largely catering to the business-to-business (b2b) players for long is also targeting the business-to-consumer (b2c) space with its specialised services. Himanshu Chakrawarti, CEO, Hicare, in an exclusive conversation with Ashish K Tiwari speaks about their plans and more.

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Could you briefly tell us about this industry and Hicare's market standing?

A niche category, the nature of this business is such that it will keep growing with not much organised competition and the growth potential is huge with increase in the general outlook towards home and personal hygiene. Comprising of product and service space, the industry is currently at Rs 8,000 crore of which Rs 2,000 crore is the service part.

Hicare had revenues of around Rs 60 crore in 2014 and we should close this fiscal at over Rs 100 crore. Last year, we grew by 35% but this year growth slowed a bit due to demonetization. So the growth is likely to be flat at 35% due to the blip during those three to four months. While we continued to grow the b2b segment, we have considerably grown the b2c segment the last few years. The revenue ratio currently is 50:50 between the two categories.

Our view is that the b2b segment will grow upto a certain poinhen it will follow a certain pace but b2c will see better growth, and hence the focus in this area. Our ambition is to grow the whole business to around Rs 400 crore in the next two to three years.

What are the services being offered for the b2c segment?

While continuing with the existing range of services, we looked at ways to add categories we never had in the portfolio. Accordingly, we added bird control/netting services last year, which is doing very well. We started off with two-three cities and are now present in 13 cities. Eight months ago we added home cleaning (completely using international chemicals) and that's picked up very well. We started with Mumbai and are now offering this service in seven cities. Very recently we even got into air-purifiers (with Blueair) and it's available only in Delhi and NCR so far. Some of the other categories we are actively exploring is pet care and car cleaning service (done through a large mobile unit). The focus now is on how to scale up the offerings and we are going through that phase now.

Who are your target audience for the b2c offerings?

We used to target the home segment earlier but have started approaching the mid-segment housing societies since the last seven months. We have acquired quite a few large societies on board in Mumbai and Bangalore. It takes up some time to break into this segment as contracts come up for renewal only after two to three years and that's when we get an opportunity to pitch with the client. Earlier, we were doing housing societies with 30 to 50 flats as we were able to establish direct relationships which was not the case with large projects. Now we are adopting the same strategy and going after the bigger ones with 500 to 800 flats.

Is partnering with realty players also part of your strategy?

Yes. A project is currently on with DLF for their most premium project in Gurgaon. They have negotiated with us a preferential rate for their customers for the next multiple years. Additionally, we are also working with realtors for pest management at the pre-construction stage to make their site/building termite-proof. It's a slightly expensive process but once done, the residents can be assured of not having termites ever in that building. Developers like Unitech, DLF and Godrej are already working with us on this for some of their properties.

Is inorganic growth part of your expansion strategy? Have you earmarked funds for it?

Yes we have. In fact, without naming any local companies, I can confirm that we have been in conversation with 2-3 companies for a possible acquisition. As for funding, the investment firm backing us will make it available as and when an opportunity comes by.