GCPL in talks with Italian co for tie-up
Godrej is in talks with 'My Hair Company' of Italy to introduce hair-colour products for high-end customers.
By PTI |
NEW DELHI: Godrej Consumer Products Ltd (GCPL) is in advanced talks with an Italian firm for a tie-up to introduce premium hair-colour products with a view to increasing its exposure in the overseas market.
Godrej is in advanced talks with 'My Hair Company' of Italy to introduce hair-colour products for high-end customers, an European consultancy firm told media. The official spokesperson could not be contacted for comment on the issue.
Besides, for the global growth of its business GCPL is also looking for acquisitions in the Middle-East, Egypt and Africa. The company holding about 40 per cent domestic market share in the segment expects to finalise a deal in this calendar year to fuel inorganic growth.
According to industry sources, the market overseas is far bigger than the Indian market size, which is estimated at about Rs 500 crore. The UK market alone is five times bigger than the Indian market.
As a part of expansion of its global distribution network, the company in 2006 acquired UK-based Keyline brand hair colour through which, it will enter into the overseas market with a ready clutch of brands.
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In the same year, GCPL made another acquisition in the hair-colour business of Rapidol UK, as well as its subsidiary called Rapidol International. The UK-based company manufactures and markets premium hair-colourants. At present Keyline outsources about half of its manufacturing to various units in the UK. GCPL's manufacturing costs and are 30-40 per cent lower than those in Britain.
Given these cost advantages, the company proposes to shift some of Keyline's production to its Vikhroli, Mumbai plant. The capacity utilisation for hair colour is already near 100 per cent.
By the end of this year, the company expects hair colour capacity to be about 500 tonnes a year, providing it the flexibility to make Keyline products.
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GCPL recently invested Rs 120 crore to set up two new facilities, one in Himachal Pradesh for soap manufacturing and another in Sikkim for hair-colour, and capacity expansion of its Malanpur facility in Madhya Pradesh.The Himachal Pradesh facility has become operational, since January 2007 and the Sikkim plant is expected to go onstream by June this year. Currently the company has facilities in Assam, Silvassa and Baddi in Himachal Pradesh.
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