No recession, just a slowdown: Godrej

CHENNAI: From chocolates and toll tariffs to land prices and holiday plans, business baron Adi Godrej touched upon a range of subjects when ET caught up with the Godrej Group chairman on a drive to Great Lakes Institute of Management���s new campus near Mahabalipuram.

Starting off on a sweet note, the Godrej honcho indicated that the Nutrine array of hard-boiled and milk candies is set to expand. You could soon be munching on Nutrine candies, lush with Hershey chocolate.

Confirming that Nutrine would enter the chocolate segment, cashing in on its tie-up with the US chocolate major Hershey, he said it would not do away with its current product mix of toffees and candies. ���There is a demand for both. Introducing new products doesn���t mean we have to do away with existing ones,��� Mr Godrej said.

Godrej acquired the Chitoor-based Nutrine Confectionery, which has a 23% share in Rs 800-crore hard-boiled category, in 2006 and it is now part of Godrej Hershey Food and Beverage.

Asked about the impact of ���recession��� on the FMCG sector, Mr Godrej���s vehement response was: ���India is not in recession. There is only a slowdown in growth.���

In fact, at Godrej, there has been no cutbacks on hirings either. ���Campus placements will be same as before. We will recruit laterally as well,��� he said, adding, ���This is the right time to recruit. When others are going slow, it is easier to attract talent.��� Advertising spends too would go up, ���20% higher than last year���.

With demand for affordable housing on the rise, the furniture and home furnishing segment too is poised to grow, he said. Home furnishing constitutes 30% of Godrej���s furniture business, under the $780-million Godrej & Boyce Manufacturing. Though office furniture offtake has seen a drop in the past few months, the overall segment is going strong ��� education and banking sectors being the prime drivers of demand, Mr Godrej said.

The FMCG sector is on the growth path, fuelled especially by increased penetration in the rural markets, he said, noting demand from rural customers continued to be on the upswing.

Taking cognisance of this, the group is constantly looking at developing products targeted at the rural consumer, Mr Godrej said, citing the example of the low-capacity refrigerator launched recently.