Marico eyes acquisitions in beauty segments

MUMBAI: Consumer products major, Marico, is scouting for acquisitions in the personal care, beauty and wellness segments, a senior company official said.

"We are always looking at acquisition opportunities that fit in well with our growth strategy. At any given time, we are talking to prospective sellers," Marico's Chief of HR and Strategy, Milind Sarwate, told media here on Wednesday.

The company is looking at the personal care, beauty and wellness segments in Africa, south-east Asia and the SAARC region, he said. Marico had, last year, acquired two leading brands in Egypt, Flancee and HairCode.

Sarwate, however, refused to divulge the names of the prospective sellers.

While the company had no immediate fund-raising plans, Sarwate said, once Marico had zeroed in on an acquisition, then it would tie-up the funding. "Our strategy is to find a good acquisition first and select the funding pattern afterwards," he said.

The Marico official also said the company had no immediate plans to increase the prices of any of its products. "We are a consumer-centric organisation and we think that pricing is more a function of what the consumer will pay for a particular product," he said.

Marico has clocked a 23 per cent growth in its turnover in Q2 FY08 at Rs 464 crore over the corresponding period last fiscal while its PAT grew 62 per cent at Rs 42 crore as against Rs 26 crore in the year-ago period. "We recorded a 16 per cent organic and 7 per cent inorganic growth which I consider a good balance," Sarwate said.

The company's operating margins stood at around 14 per cent and going forward this fiscal, Sarwate expected this to be maintained. Marico's flagship brands, Parachute and Saffola, registered healthy growths during the quarter at 8 and 32 per cent respectively while its hair-oil business expanded by 16 per cent.

International operations presently contributed around 14 per cent to Marico's total revenues. "We are not letting go of any growth opportunity here," Sarwate said, adding that Parachute coconut oil now commanded a 67 per cent market share in Bangladesh.

Going forward, Marico expects to maintain its growth momentum this fiscal. "Our profits have grown consistently over the last 32 quarters," Sarwate said, adding that "The company expect FY-08 to be a good year."