ITC’S Savlon set to post 4x rise in consumer spend

Riding the hygiene wave during the pandemic, ITC’S Savlon is set to cross consumer spend of ~1,000 crore this year, a more than fourfold jump from last year and the first from the personal care portfolio to achieve the milestone.

Sameer Satpathy, divisional chief executive officer, personal care products business at ITC, said, Savlon would be the first brand from the personal care portfolio to clock in consumer spend of ~1,000 crore. Till recently, Vivel was the largest brand in ITC’S personal care business, with an annual consumer spend of ~500 crore.

However, it is understood that Savlon’s consumer spend may already be at ~1,000 crore. The annual consumer spends of ITC’S non-cigarette fast moving consumer goods brands was ~19,700 crore in 2019-20. The ~1,000 crore-plus brands were: Aashirvaad (~6,000 crore), Sunfeast ( over ~4,000 crore), Bingo! (~2,700 crore), Yippee! (~1,300 crore), Classmate (nearly ~1,400 crore); Savlon was at ~250 crore.

Satpathy said Savlon had been growing at compound annual growth rate of 50 per cent for the past five years. “The size of the brand is 15 to 16 times more than what it was when we acquired the brand. We used all our levers to rekindle growth and equity, be it distribution, brand building, and innovation,” he said.

A slew of products was launched during the pandemic under the Savlon brand keeping in mind the consumer requirements. Disinfectant spray, sanitizers (plain and medicated), wipes, disinfectant cleaning products, multipurpose disinfectant liquid, and clothes were some of them.

In 2015, when ITC acquired Savlon (along with Shower to Shower), it had a soap, antiseptic liquid and a bit of hand wash. The consumer spend was ~50-55 crore.

Though Savlon has been growing, but it is the pandemic that has given the brand a real push. Savlon, now, is selling in month what it normally used to in a full year. Manufacture of sanitizers was ramped up by 275 times to cater to the surge in demand.

Satpathy said five-six new sites were added for manufacturing, using partners. A new plant is also coming up in the East. Speaking on the other acquisition, Nimyle (the floor cleaner brand), Satpathy said it was already four times the size since it was acquired two years ago. “It was primarily a West Bengal brand, but we have now taken it to the whole of East and rolled it out in the South. In the East, we have already become the number one brand by volume.”

Nimyle was likely to record consumer spend of ~150-160 crore this year. ITC has been facing tough questions from investors on various fronts,

including its acquisitions.

“Both the brands are ahead of the acquisition assumptions both in top line and bottom line. We are creating value for the organisation and also for all our stakeholders,” Satpathy said. ITC has extended the Nimyle brand to come up with a fruit and vegetable wash, Nimwash. Explaining ITC’S rationale behind acquisitions, Satpathy said, “The guiding principles were that it should be value accretive. Second, it should meet the governance standards of consumer safety and the quality standards. We believe that such an approach leads to a more sustainable performance and helps it to grow and build strong brands in businesses.”

ITC has always shown ability to grow brands organically, Satpathy pointed out. “Inorganically, we are even more confident,” he added.