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Group No. 7
Kumar Atulya Mitali Parekh Neha Pareek Ponappa SM Siddhant Masson PGP-12-118 PGP-12-124 PGP-12-129 PGP-12-133 PGP-12-149
“Going international is critical not only in order to create multiple growth engines but also to create reverse learning for the home market. Some nations offer inorganic entry possibilities that can create access to mainstream distribution, manufacturing and talent. This can speed up one's learning curve as long as there is a strategic fit with the target.” ~Mr. Vijay Subramanian CEO, Marico IBG
...............................................................................................................................................................................................................................................Marico Ltd......................................................................................................................................................................................................................................... 1 International Business Project Contents EXECUTIVE SUMMARY ........................... 6 PORTER’S 5 FORCES FRAMEWORK ................................................................................................. 2 INTRODUCTION ................... 9 RECENT CHALLENGES AND REMEDIAL MEASURES ............. 7 YIPS FRAMEWORK FOR DEGREE OF GLOBALIZATION ............................................. 14 REFERENCES ............................................................................................................................................................................................................................. 3 SWOT ANALYSIS ........................ 15 ........ 12 THE WAY FORWARD ................................................................................. 8 CURRENTLY IMPLEMENTED AND PLANNED GLOBAL INITIATIVES ................................................................................
Despite the financial meltdown and the political instabilities in certain parts. and has also suffered losses particularly in Bangladesh (due to high material sourcing as a result depreciated currency) and Egypt and other parts of MENA (as a result of political instability and unrest). The report also evaluates the globalization initiatives through established frameworks like PESTLE. It includes analysis of the global business activity and its contribution to the firm. reducing working capital and reduced communication costs in a global landscape. it emerged that the biggest threats faced by Marico throughout its global operations has been high inflation and currency fluctuations. it emerges that Marico faces the biggest threat in the form of competition from global FMCG giants like HUL. It also exports its products to countries outside these 7 nations. and similar innovations have been differentiating them.Marico Ltd. and then moved on to have a deeper footprint through forming subsidiaries. It can further expand in emerging countries and diversify its portfolio to mitigate long term risks. have been instrumental in increasing penetration. Yips framework for measuring degree of globalization among several others to understand the rationale and their implication on the firm. It began with exports to middle east and neighbouring nations. It also has a comprehensive Risk Management Process. International FMCG Business Group (IBG) and Kaya Skincare Solutions. Among global operations. It has believed in cross pollinating in different geographies. P&G. Marico has experienced an overall healthy growth at its global markets. Consumer Products Business (CPB). through an internal audit system depending on the size of the SBU or subsidiary. it clearly stands out that the low cost of manufacturing was one of the primary reasons to open production facilities in Bangladesh. One of the significant attributes about Marico’s success in the global markets has been its global mindset. It is under the International FMCG Business Group (IBG) that the entire global business is managed. in the MENA region. . with its internet enabled platform called MI-NET to establish a connect among all its businesses. 2 International Business Project EXECUTIVE SUMMARY This report assesses the global business initiatives and expansion of Marico Ltd. it has good prospects in the intermediate term owing to its differentiation policy. it has managed to have a good presence in more than 7 countries through its own subsidiaries. Marico has in the past tackled this by diversifying into edible oil. posing very high sourcing costs as a result of exchange rates and transportation. Its global expansion has been a mix of both organic and inorganic growth with a number of products added to its portfolio through acquisitions. Based on a SWOT analysis. and Colgate Palmolive. However. Porter’s forces to analyze country attractiveness. As a result of the recent financial meltdown and political instabilities in some countries the IBG has been prone to risk. IBG contributes to more than 23% to Marico’s revenues. it is suggested to have additional hub locations apart from Egypt in other parts of Middle East and North Africa. its major share (nearly 50%) comes from Bangladesh and another 20% from South East Asia. in the last decade. it has managed well to have a steady growth owing to its differentiation and innovation. and hence there has been a heavy dependence on few countries which poses a risk. Making products compatible in different environments such as the reformulation of parachute hair products to work effectively even under chlorine rich circumstances in Middle East. particularly in West Asia. tied into its Corporate Governance Practices. Based on this report’s analysis it is recommended to concentrate on local sourcing which contributes a mere 1% currently. Kaya recently acquired the aesthetics business of the Singapore based Derma Rx Asia Pacific Pvt. Based on the Yips framework. Marico started its first global initiative in middle-east by exporting Parachute oil. healthcare and skin care in global markets. Its globalization strategy has been to look for newer markets (through geographical expansion) yet at the same time a horizontal expansion with diversification. Marico over the years has managed to segment its business across 3 SBUs namely. Ltd. For instance. Over the years. Based on Porter’s 5 Forces. Also. The recent use of Information Technology. Marico started with a gradual transition towards its globalization. with a detailed look at its portfolio in each international market.
72 million USD for the financial year ended 31st March 2012. 3 International Business Project INTRODUCTION MARICO INDIA Founded in 1987. Marico India Ltd. One out of every three Indian has a Marico Product in his household. PRODUCT PORTFOLIO The business structure of Marico is segmented into three Strategic Business Units viz. Edible Oil. the company offers skin care and dermatology solutions under the brand name Kaya and DermaEX in Singapore. coconut oil.Parachute Advansed Ayurvedic hair oil. Marico’s diverse product portfolio covers industries such as food. Nihar Shanti Amla. Parachute Advansed Cooling oil Saffola Saffola Market 51-53% ~23% Share Rank 1 2 Super Premium Refined Edible Oils Functional Foods like Oats & low Glycomic-Index (GI) Rice Anti Lice Treatment Mediker Fabric Starch Revive The categories and brands present in international markets are: Market Bangladesh South Egypt Middle East Malaysia Vietnam Category Coconut Oil. Parachute Jasmine. enjoys a market capitalization of 0.6% of the net sales with coconut oil accounting for ~32% of the share.Marico Ltd. Oil Of Malabar. Home Care and Foods ~55% ~90% ~80% 1 1 1 Product/ Brand Parachute Oil.8% and 6. Nihar Hair & Care. Nihar Naturals.14 billion USD and a turnover of 0. Haircode.5 Million outlets. Saffola Caivil. Hair oil. The domestic product portfolio along with market standings of Marico’s various brands is given below: Categories Coconut Oil Hair Oil Brand Parachute. Balack Chic. Parachute. L'Ovita. I) Consumer Products Business in India (CPB): This arm of Marico includes fabric care products. The flagship brand of Marico. II) International FMCG Business Group (IBG): This branch of Marico spreads out in over 20 countries worldwide including Middle East. Herculer. Asian Sub-continent and Australia. Ingwa Fiancee and Hair Code Parachute cream and Gels Code 10 (cream and Gels) X-Men. Every month. skin-care and hair-care. Each of these SBUs contributes to the overall growth of Marico. ParachuteAdvansed. CPB contributes almost 69. processed foods and hair care products. III) Kaya Skincare Solutions: Under the aegis of this division.6% respectively. IGB and Kaya account for the balance 23. over 70 million packs from Marico reach approximately 130 million consumers in about 23 million households through a widespread distribution network of more than 2. contributes almost 30% to the company’s top line. Marico is a renowned Indian consumer goods company providing products & services in the Healthcare and Beauty industry. Hair Care Hair Care and Health Care Hair Care Skin Care Hair Care Personal. Thuan Phat Foods .
Fiancee and HairCode. with over 17 clinics. Ltd. Marico entered Malaysia’s hair styling market in January 2010. near Gazipur. Kaya acquired the aesthetics business of the Singapore based Derma Rx Asia Pacific Pvt. as well as 2 clinics in Bangladesh.Marico Ltd. In 2010. In May 2010. Currently. This has shown consistent growth in the Ethnic Hair Care and Healthcare market sector. 2010 and 2011 saw Marico’s entry into South-East Asia with forays into Malaysia and Vietnam. Marico has also taken advantage of the fast-growing professional beauty industry by expanding Kaya Skin Care Clinics to Middle East. With a steady increase in its product range and an ever widening distribution system. Marico further made a bolt-on acquisition with the Ingwe/Medi-Pac range of healthcare products in 2010. With this. Marico set up the International Business Group (IBG) which made inroads in Bangladesh in 2002 by setting up a factory. in Bangladesh.8 million (about Rs 52 cr). Contribution of key geographies to IBG 25% 10% 25% Bangladesh 40% MENA South Africa South East Asia Following successes in Middle-East. Marico acquired the consumer division of South Africa's Enaleni Pharmaceuticals for SA Rand (ZAR) 92. In 2007. Marico’s progress in the Middle East is heading for rapid growth. Marico became the first Indian company to have manufacturing capabilities in Bangladesh. Levant and Bahrain. Marico operates through Marico Bangladesh Limited (MBL). 4 International Business Project Evolution and Growth of the International FMCG Business Group Marico made its first global foray by launching the Parachute brand in the Middle-East in 1990s. Marico saw this as an opportunity to expand their footprint outside India. Marico launched the Parachute range of hair creams and hair oils in the local Egyptian market. Marico entered Egypt in 2006-07 with the acquisition of brands . Marico entered the Vietnam market by acquiring an 85% equity stake in International Consumer Products Corporation (ICP)-one of the most successful Vietnamese FMCG companies. Black Chic and Hercules became part of the Marico umbrella. Increasing Geographic Diversification UPPSALA MODEL . Parachute has presence in countries like Yemen. In February 2011. along with setting up a factory in 2008. brands such as Caivil. Apart from the UAE and Saudi Arabia. Iraq. Marico is betting big on South-East Asia and hopes to replicate their MENA successes in this sector too. Consumer research had shown that Parachute Hair Oil was popular amongst Indians living in the Middle-East. with the acquisition of the Code 10 brand from Colgate-Palmolive. a wholly owned subsidiary with its manufacturing facility at Mouchak. Marico is the leader in the Hair Styling market in Egypt and hopes to make the country their sourcing hub for MENA. and officially launched Parachute.
Marico Ltd. 5 International Business Project GLOBAL EXPANSION ROAD-MAP .
and a diverse geographic footprint. Being a leader in the Indian Rural Market ensures that it grows manifolds in both volume and value. such as Parachute and Saffola. 6 International Business Project SWOT ANALYSIS STRENGTHS INTERNAL Parachute Hair Oil. and the acquisitions it has made over the last 5 years.Marico Ltd. Further. The only threats that we could foresee was the rising inflation in most of the markets that Marico is competing in. giving it a global presence in 7 developing regions of the world. based on the regional preferences and demands. provides it a sustainable safety margin. in the International Market. Mediker are market leaders Robust distribution network Local &global acquisitions Stress on innovation & differentiation Rural market leader Incorporation of local tastes & preferences Easy availability of credit& increased consumerism Recent waiver of farm loans makes rural India a promising market for FMCG &durables Increased health consciousness Better standard of living and increased brand consciousness OPPORTUNITIES EXTERNAL A substantial decline in EPS over the years indicating improper shares distributions Probable inappropriate funds distributions due to high current ratio Wide difference in terms of market share Major revenue generation from few brands Rising inflation levels can slim down margins since operating costs contribute to 60% of total cost Product innovation & advertising expenses are risky Internationalization exposes them to financial currency fluctuations risk WEAKNESSES Marico’s strength lies in its vast Product Line. Marico’s continued focus on Product Differentiation and Innovation can reap rewards for its brands. especially taking into consideration the stiff competition that any FMCG company is subjected to. However. it has widened its successful product lines. which could lead to a reduction in its margins. THREATS . Saffola. not to mention the varied brands under Marico.
An early mover advantage in Bangladesh. Each of these players has developed strong brand equity over the years and has a set of loyal customers In case of potential threat. the FMCG industry.Marico Ltd. Colgate & Palmolive. and the trend has been emulated in other regions by the other Marico subsidiaries. is highly evident in the results of Porter’s Five Forces analysis. P&G. Brand building. product innovation and product differentiation are necessary to survive in the FMCG Sector Volumes and not margins can be leveraged to maximize earnings Threat from Suppliers: MEDIUM Industry is dependent on local players for supply of raw materials Cost control and adherence to quality standards becomes crucial THREAT OF NEW PRODUCTS (CLONES) Threat from Clones (New Entrants) : LOW The FMCG industry is dominated by established players such as HUL. large companies like Marico can buy out the threat company THREAT OF SUBSTITION: HIGH There is a threat internally itself with preferences ranging from Parachute Oil to Nihar Amla Oil Marico products can be easily replaced by regionally/locally made products in rural areas THREAT OF SUPPLIERS Threat of Competition THREAT OF CUSTOMERS (BUYERS) THREAT OF SUBSTITU TION Threat from Customers: (Buyers) – HIGH Highly substitutable market with price sensitivity Few established players in the market Low switching costs for customers Hence. pose great threat to Marico Ltd. P&G. . and Marico etc. Already recognized as a premium Product manufacturer. Dabur etc. the diversity of products in its portfolio. along with a knack to deliver on the requirements of the consumer has so far kept Marico way ahead of competition. 7 International Business Project PORTER’S 5 FORCES FRAMEWORK The Threat of Competitors: HIGH FMCG Conglomerates such as HUL. Colgate & Palmolive.. customer is king Being a part of a highly competitive and cost sensitive industry. from where Marico gets 50% of its International Revenues. Marico can counter these threats by building on its Product Differentiation. has been sustained with strategic alliances and acquisitions.
has considerably brought down the production costs. Ever growing demand for diverse FMCG products across the globe 2. Export Processing Zones in Bangladesh 2. Cost Drivers 1. Relocation of Production Facility to other countries. especially Bangladesh. but many strong regional players in different regions. Marico is already a market leader. as there is a huge scope for Consolidation. such as the existing 14 Production Units. 3. can cater to regional preferences by customizing its current products. Competitive Drivers 1.Marico Ltd. Option of growth through acquisition. Foreign Government Regulations that favour Foreign Investments in these countries . seeing that there are very few global players. 2. and expanding its offering. Government Drivers 1. Marico’s emphasis on Product Innovation and Differentiation sets it apart from competition. and the only way to increase volume and value profit is by expanding into new markets and/or expanding product line. It is a highly price-sensitive industry. and another plant planned in Bangladesh. Advantage of difference in labor and manufacturing costs in different countries. for eg. 8 International Business Project YIPS FRAMEWORK FOR DEGREE OF GLOBALIZATION Market Drivers Cost Drivers Potential for Globalization Government Drivers Competitive Drivers Market Drivers 1. 2. Also. Favourable growth conditions in these countries. and gives it a huge Competitive advantage in both Indian and Global markets. and has an extensive product line.
While this certainly explains Marico’s aggressive foray in the international markets. 10% and 20% respectively. The company has been following the strategy to gain access in fast growing economies with under penetrated markets. It fosters an option of leveraging on cross-border learning. especially statutory compliances •Constrictive critique of strategic business plans •Focus on core business of beauty and wellness •Conservative debt policy. Fairness. This is led to more and more company/brand acquisitions in emerging economies. which started off as a small player in the traditional commodity driven business. “Marico is a professionally managed company that has built for itself a simulating work culture that empowers people. Responsibility. 9 International Business Project CURRENTLY IMPLEMENTED AND PLANNED GLOBAL INITIATIVES •Transparency and openess to help stakeholders take informed decisions •Timely announcing of Financial Reports •Email updation. the SBU has sustained its growth trajectory over double digits in the last few years. Middle East and North Africa. MENA. Some of the current and in-process initiatives planned by Marico are: . South Africa and South East Asia. Bangladesh contributes over 40% to the total international business revenues and forms Marico’s major overseas market. globalization offers opportunities beyond the realm of just opening up new growth opportunities. stay away from exotic derivative projects •Swift measures in case of transgression by menbers Marico’s Internal Corporate Governance Framework Marico’s International Business captures several key geographies like Bangladesh. the organisational model has entailed a detailed plan to continue their movement up the growth trajectory. promotes team building and encourages new ides” For Marico. The division as a whole in itself contributes almost a quarter of Marico’s total revenues.Marico Ltd. South Africa and South East Asia contribute the remaining 25%. By a mix of Organic and Inorganic growth. Finacial summaries and Investor conference results uploaded on Website •Maximize effectiveness of both by separating accountability •No representatives of vreditors or banks in the Board •Strict compliance with Marico's Unified Code of Conduct Generative Transparency and Openness in Information sharing Constructive Separation of Ownership and Management Accountability. Social Awareness Value Adding Checks and Balances •Prevent authority misuse •In-time response to change •facilitate management of risks.
Similarly. Risks are multi-dimensional and therefore have to be looked at in a holistic manner. Cross Pollinating Across Geographies A major part of Marico’s success in the FMCG domain can be attributed to its Global Mindset. For example. the external environment and the internal processes. efforts are made to streamline the functioning of the company to make the success accountable and measurable. The risks involved in all global initiatives and expansions are analysed across its value chain keeping in mind the three set Business Risks of risks. the wholly owned subsidiary MBL in Bangladesh was listed on the Dhaka and Chittagong Stock Exchanges. As a major change in its traditional approach. Risk Assessment and Risk Mitigation Framework (Ref: Corporate Governance Framework 2012) Marico believe that: Risks are an integral part of any business environment and it is essential that we create structures that are capable of identifying and mitigating them in a continuous and vibrant manner. 2. The Audit System. Markets with favourable macros. professional managers were sent to overlook the functioning of the branch. 10 International Business Project 1. independent of the executive Risks Risks directors and promoters of the company selects. People. The key criteria is the policy to participate in formats that are relevant and important to the segment and market that is being catered to as opposed to transporting the India portfolio on an ‘As Is’ basis. the focus is on categories with low to medium penetration levels. To ensure significant headroom for growth. though the acquired company in Egypt was a family owned business. progressive government policies and rising consumer power are primary destinations for expansion. straddling both. Egypt and South Africa. An Internal Audit System depending on the size of the SBU or subsidiary is put into Governance Control place. This also ensures that significant checks are in place with reference to all the potential pitfalls. soccer forms and integral part of several campaigns held in Egypt The current focus is on expansion in emerging economies in Asia and Africa like Bangladesh. Marico has incorporated an internal framework along the following philosophical cornerstones to ensure strict Corporate Governance Practices. Pace. For instance: Reformulation of Parachute hair products to work effectively even under chlorine rich circumstances present in the Middle East Advertising leverages the local flavor capitalizing on the interests and requirements of the respective market. For instance. The Risk Management Process envisages the relevant functions by prioritizing risks based on their expected impact followed by tracking and mitigating them periodically. In these new markets. Philosophy. Middle East. Physical Execution and Providence Philosophy Pace People Physical Execution .Marico Ltd. evaluates and where appropriate introduces changes and ensures a unified and comprehensive perspective. the company has transitioned from an India-forward mindset to playing by the rules of the market. The five P’s viz.
to reduce the gestation period associated with the learning curve in new markets. CPB. the focus has shifted to low price packs along with packaging innovations to help it retain its market leadership status.Marico Ltd. reduced working capital and reduced communication costs. Instead of participating in the market dynamics. 11 International Business Project Providence were critical success factors in the integration and post-acquisition growth in these markets. In Bangladesh.e. Marico has focussed on interacting with non-competing Indian companies who have been successful in similar markets and learnt from their experiences. Specific Focus on Value Added Hair Products and Super-Premium Edible Oil segments Volume Growth of Value Added Hair Products in the last 10 quarters Saffola’s Volume growth over the last 11 quarters A basket of value added hair products including segments like pre-wash and post-wash and male grroming has resulted in almost 13% of the total revenues of Marico and around 18% of the reveues of its SBU in India i. The project is expected to reap benefits in the form of increased penetration. This segment is currently untapped and un catered by any other player in the industry. Similarly. In almost all markets. the focus is now on providing consumers with more specific solutions. Marico has been constantly investing in its IT systems. it has an exclusive presence in the Anti-Lice segement in the form of its Medikar shampoo. Keeping in mind the the territorial expansions. In brands like Sweekar. In India. A MIS system has been put into place for real time tracking of data. 3. With the category expading Marico’s market share in every market. despite the fall in volumes. 4. the focus in South Africa is on the niche Ethnic Hair category. Marico has recently invested in an internet enabled platform called as MI-Net to establish a connect amongst all its businesses. Use of Information Technology in Sales To ensure supply chain efficiencies along with the availability of SKUs at the ditributor point to avoid the deadly sin of Out of Stock. packagong restating and penetrative pricing. This is despite the price hikes that have been incorporated as a result of the rise in input costs. In a market filled with large scale competition with volume players focusing on low margins and price wars. where edible oil is a huge category with many players. This segment has manintained high growth trajectory over the last 10 years with an average CAGR in double digits. The focus is evenmore on participating in the sub-segments with a wider portfolio in the form of Ayurvedic and Cooling oils to drive growth . Marico is planning to focus on deviating from the ‘Commodity’ tag. The Art of Speciality and Focus on Margins The ability to quickly pick its spot in a crowded segement has pushed Marico to be amongst one of India’s largest success stories in the FMCG sector. This is also the reason why Marico recently let go of its Baby Oil segment which has strong competitive presence. Marico occupies a small but substantial high end segment focusing on healthy and good for heart oils. Also. 5. this strategy has ensured solid top line results. Marico insists on conveying its brand and value proposition to its customers.
The hair care business in Egypt accounts for nearly 7% of the company’s business and impacted the overall results for more than a quarter Also. Saffola Tasty and Saffola Active. Saffola. RECENT CHALLENGES AND REMEDIAL MEASURES This section lists down the various challenges faced by Marico in each of their international markets as a result of the recent financial meltdown or other forms of instabilities. Saffola Gold. Leveraging on its ‘good for heart’ platform. this resulted in Remedial Measure/ Plans Currently only a mere 1% of the sourcing is done from within Bangladesh. 12 International Business Project With a contribution of about 16% to the total revenues of Marico. The flagship brand Saffola. As a result there was 60-70% production loss. but to also save on transport costs involved Egypt Fiancee. the plan is to provide Saffola in four different blends. Parachute Additional locations for setting up hubs in relatively stable countries for the supply chain to minimize risk in West Asian and North African markets which are politically instable . the 41 year old brand of Marico is poised to create a strong franchise for itself in the super-premium refined edible oil market. Hair Code. in lines with the globally rising concern for better health. The table below mentions only the most important or impacts factors. The aim is to provide pricepoints even in the super premium segment. Marico aims to create a disctinct niche for itself. In a bid to promote healthier lifestyle. This section also provides the remedial measures or plan which can be undertaken to tackle these vulnerabilities. There is an important need to look for a greater share of sourcing from local sources to save raw material costs as a result of weak currency. As a result Marico incurred significant higher costs for importing raw materials and substantial loss in gross margin throughout last year Further down political unrest and military rule in the past have resulted in loss of business days in the form of strikes The unrest in Egypt had resulted in the production being shut at its two manufacturing and distribution units. Camelia and Aromatic. there was little impact on the GDP growth of Bangladesh. Country Bangladesh Brands Parachute. Saffola Gold Vulnerability due to Financial Meltdown or Other instabilities Even during the global recession in 2008. since Egypt was being used as the hub for the entire supply chain in MENA – (North Africa and also some parts of middle-east). Hair Code. which grew at a rate of 5-6% However. in the recent years there has been a steep decline in the BDT:USD exchange rate.Marico Ltd.
the Diversification into other Hercules. The inflation has been riding to as high as 18%. South African market has remained segments for having a Ingwe stagnant. Though the market has been fairly conducive for FMCGs despite the recent meltdown. Hair Code Additional locations for setting up hubs for the supply chain to minimize risk in stable countries of MENA . there have been disruptions in the other markets like Bahrain etc. Parachute As Marico has only recently entered Malaysia by acquiring Code 10 from ColgatePalmolive. L’Ovite. Hence. which could be a negative factor for consumer care products Also. Thuan Phat Localized sourcing of raw materials will help saving considerable costs of imported materials Malaysia Code 10. the sector faces very high competition from other global companies (MNCs) Vietnam X-Men. can be Marico’s business recorded only a 7% explored in South Africa growth in the top line. where the emphasis has been suggesting that the demand has come majorly on consumer care down in South Africa as opposed to products other countries where FMCG demand remain normal. However. To invest in products which are necessities like cooking oil etc. 13 International Business Project disruption of production and sales across the two continents Egypt factory closure disrupted company’s entire business operations Though the overall FMCG growth is robust and resulted in 14% growth in the Marico sales. and the overall FMCG sustaining growth is an segment remained flattish option.Marico Ltd. yet raw materials sourcing. Chic and Post the economic downturn. as a result of the unrest and the political climate West Asia Parachute. it would have spend considerable efforts building its brand Singapore South Africa It will have to leverage the already established Parachute brand in Malaysia Derma RX (Marico only very recently entered Singapore and has minimal presence there currently) Caivil. the weak Dong currency has led to rise in the cost of imported materials. were the trouble makers Further there have been inflationary pressures and hence the market has been experiencing down-trading Apart from Dubai. the business environment is challenging. exchange rates etc.
200 per share for every 50 fully paid-up equity shares of Re. For example. called Marico Kaya Enterprises (MaKE) The Kaya business will be formed as a 100 per cent subsidiary of Marico. brand building of Parachute cream in Egypt and launching Haircode Styling products in West Asian regions Implement local adaptations in product range such as improved dry skin care in body oils by Marico launched in Egypt etc.1 each held in Marico. One fully paid-up equity share of Rs. For instance. All employees on the payroll of Marico and are deputed to Kaya will move to MaKE or one of its subsidiaries. The Finance function would continue to act as a Shared Service Group for both Marico and Kaya WAY FORWARD A cross-pollination of products can be done across geographies that Marico is present in.10 each of MaKE will be issued and allotted at a premium of Rs. Focus on growth of those categories which enjoy significant market share. Coconut oil in Bangladesh and male grooming products like Zatak in MENA and Vietnam Build brand equity in Bangladesh through Parachute Coconut Oil and leverage it to establish other products in the market Increase share in key categories in South Africa and expand footprint in other part of Sub-Saharan Africa over the medium term Carry out feasibility analysis and industry attractiveness studies in emerging markets such as Asia and Africa in the long term . Harsh Mariwala will continue to be the Chairman and Managing Director of Marico and Marico Kaya Enterprises Ltd.Marico Ltd. 14 International Business Project THE WAY FORWARD RECENT DEVELOPMENTS In early January 2013. it was announced that Marico's consumer products business in India (CPB) and international business group (IBG) would form a unified FMCG business. and Kaya will be re-defined as a separate business entity. Mr.
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