Industry profile The Fast Moving Consumer Goods (FMCG) sector in India has been growing at a healthy CAGR
of 11% over the last decade Riding on the back of increasing demand and changing consumer preferences, thanks to higher disposable incomes and the retail revolution, the sector has been posting double-digit growth over the past couple of years The Indian FMCG sector is the fourth largest sector the economy with a total market size of Rs. 167,100crs1. The market is estimated to grow to US$ 100 billion by 2025, according to market research firm Nielsen*. The industry is volume driven and is characterized by low margins. The products are branded and backed by skilled marketing, heavy advertising, slick packaging and strong distribution networks. Also, raw material prices play an important role in determining the pricing of the final product .Modern retail formats too have contributed in a major way in pushing the growth in the FMCG sector. With rising income levels and the spread of modern retail, the FMCG industrys future prospects look bright which is expected to further boost sales Growth in the sector is led by higher urban and rural demand. Going forward, the governments growing support to agriculture will drive long-term growth in consumption from the rural sector India faces contrasting problems of having one of the highest malnutrition cases and also being the diabetes capital of the World. In our view, both of these are an opportunities for Food companies. Oil industry The demand for edible oils in India has shown a steady growth at a CAGR of 4.43% over the period from 2001 to 2011. The growth has been driven by improvement in per capita consumption, which in turn is attributable to rising income levels and living standards. However, the current per capita consumption levels of India (at 13.3 Kg/year for 2009-10) are lower than global averages (24 kg/year). The Indian edible oils market continues to be underpenetrated and given the positive macro and demographic fundamentals it has a favourable demand growth outlook over the medium-to-long term.
In terms of volumes, palm oil, soybean oil and mustard oil are the three largest consumed edible oils in India, with respective shares of 46%, 16% and 14% in total oil consumption in 2010. Given the high price consciousness and varied taste preferences of Indian consumers, ICRA expects these three oils to continue to account for the bulk of edible oil consumption in the country. There has been a significant gap between demand and supply of edible oil because of limited availability of oil seeds and shifting of acreage to other crops in the domestic market. Indias annual per capita consumption has shown a steadily increasing trend from 4 kg in the 1970s to 10.2 kg in the late 1990s to current levels of ~13.5 - 14 kg. However, it still ranks well below the world Average of around 24 kg (per capita figures including consumption of bioenergy), thereby signifying.The high growth potential of the industry An important characteristic of the Indian edible oil consumption pattern is the variation in preferences across regions, driven by taste and availability. For instance, soyabean oil is mainly used in northern and central regions of India due to the local availability of soyabeans. Mustard oil is largely consumed in north-eastern, northern and eastern regions of India, as its pungency is a desired and inherent part of the local cuisine. Palm oil has increasingly become the oil of choice in southern India due to the warmer climate (palm oil gets a cloudy appearance in colder climates) and easy availability from South-east Asia. The increased health awareness also determines the consumption pattern with mustard and soya considered healthier than palm oil, which has higher levels of saturated fats. Oils like rice bran and olive are also gaining popularity due to their superior health properties, although their consumption remains fairly low in absolute terms. Further, price economics also have an important role to play in determining consumer choice, given that expenditure on edible oil constitutes a significant portion of the household budget.
Company profile Background and inception of the company The inception of Emami Group took place way back in mid seventies when two childhood friends, Mr. R.S. Agarwal and Mr. R.S. Goenka left their high profile jobs with the Birla Group to set up Kemco Chemicals, an Ayurvedic medicine and cosmetic manufacturing unit in Kolkata in 1974. A dream of reaching out to the Indian middle class; a target audience whom they thought will have increasing potential for consumption, the company started manufacturing cosmetic products as well as Ayurvedic medicines under the brand name of Emami from a small factory in Kolkata.
In the early days the two friends used to go around places and sell their cosmetics from shop to shop. They piled their goods on hand pulled rickshaws and went on distribution drives making their brand extremely popular, available and acceptable among consumers. The first-rate quality of the products soon created a consumer pull and gradually some people were hired to work for them. A chain of distributors was established and the sale of Emami products spread from West Bengal to rest of Eastern India and gradually to other states.
Emami Talcum, Emami Vanishing Cream and Emami Cold Cream were great favorite brands with the quality conscious consumers in the mid-seventies. The company soon became adept in selling beautiful dreams to Indian women interested in finding their own identity. The company set up Emami Biotech Limited in 2006 which is a part of the Rs 4000 crore Emami Group of Companies based in Kolkata, India. Emami Group is spearheading the process of developing Haldia in West Bengal as Indias biodiesel hub through Emami Biotech Limited which is a subsidiary company of Emami Group.
Nature of business carried Emami Biotech limited is a friend to earth. It is a leading manufacturer of edible oil and bio diesel fuel. The company has set up a state-of-the-art 300 tonnes per day multi-feed stock biodiesel plant at Haldia, the largest and the first of its kind in eastern India, at a cost of Rs. 150 crore, in technical collaboration with Desmet Ballestra of Italy. Conforming to stringent European Union Standard (EN14214) norms as well as the benchmark standards set by BIS (Bureau of Indian Standards), Emamis biodiesel promises to fulfill the energy needs of the country and also protect the environment. The biodiesel can be blended with conventional diesel without modifying engines. With increasing economic activity and global warming continuing to haunt human civilization, Emami Biotech Limited faces the challenge of protecting the planet from the perils of growth. Determined to give greener substitutes for petroleum derivatives and a new lease of life to the choked arteries of man and nature alike, the company inspires optimism on what the future can be. An additional amount of Rs 100 crore has also been spent at the same facility for producing edible oil of 3 lakh tpa capacity. In edible oil they are the manufacturer of vanaspati ghee, refined oil, soyabin oil, mustard oil, palm oil and sunflower oil and have always endeavored to provide with the best solutions. Healthy & Tasty oil is their way of ensuring a healthier India. By maintaining the taste of all kinds of cuisines, Healthy & Tasty oil eliminates the need to avoid food items that are rich in oil. We break the myth that health and taste cannot go hand-in-hand in food. The Healthy & Tasty brand will help any food sparkle with both health and taste. Its constituents promote brain health, lower the risk of cardiovascular diseases and provide skin nourishment. Besides, the ingredients also help in lowering cholesterol levels and blood pressure. Healthy & Tasty cooking oil has been developed by adopting the 7 Stage European Refining Technologies to create a unique combination of purity and taste through retention of natural ingredients
Vision, Mission and Quality policy Vision Making people healthy and beautiful, naturally.
Mission To contribute wholeheartedly towards the environment and society, integrating all our stakeholders into the Emami family. To make Emami synonymous with natural beauty and health in the consumers mind. To effectively manage talent by building a learning organization. To strengthen and foster strong feelings of oneness within the Companys employees. To drive growth through quality and innovation in products and services. To uphold Corporate Governance principles. To encourage decision making abilities at all organizational levels.
Quality All manufacturing units are ISO 9001:2008-certified and GMP-compliant. The Abhoypur, Amingaon, Pantnagar and Dongri units accredited with ISO 14001:2004 and ISO 18001:2007 ISO 9001:2008-certified Internal Audit Division. Robust R&D spearheaded by Padmashree Vaidya Suresh Chaturvedi and supported by eminent Indian and international experts.
Products & Services Emami Biotech Limited proudly presents Healthy & Tasty cooking oil, a healthy alternative to regular cooking oil. Healthy & Tasty helps retain the sumptuous taste of the ingredients along with their nutritional value thus giving us healthy food that tastes great! Healthy & Tasty cooking oil is available in 6 different variants. Lets look at the variants so that you can make an informed choice about the kind of oil that best suits your cooking: Refined Soyabean Oil Soyabean oil has a well-balanced fatty acid composition. It has high amount of beneficial Omega3 fatty acids and acceptable ratio of Omega6 and Omega3 fatty acids, recommended by World Health Organisation. Refined soyabean oil is clear and light, and foods prepared using it are less oily/greasy. Soyabean oil has got natural Vitamin E and some other beneficial phytoconstituents. Emami's Healthy &Tasty 7 Stage European Refining Technology (ERT) helps maintain the highest standards of purity and retains plenty of natural antioxidants, alpha-linolenic acid (ALA)/omega 3 (74 g/kg) and vitamin E (993 mg/kg) in H & T Refined Soyabean Oil. Kachchi Ghani Mustard Oil Known for its characteristic sharp and pungent flavour, mustard oil is generally available as filtered oil. It is high in beneficial MUFA (Monounsaturated Fatty Acids) and Omega- 3, which help reduce the risk of colon tumour, heart disease and reduces bad cholesterol. It also contains erucic acid, a fatty acid that has undesirable effects on health when consumed in large amounts. Sometimes mustard oil is adulterated with toxic argemone oil that has adverse effects on health. Hence, while selecting mustard oil, make sure to purchase a brand that uses a good extraction
and filtration technology. Emami's Healthy and Tasty Kachchi Ghani Mustard Oil is manufactured using the best quality seeds by First Press Technology. It is pure and strong in natural pungency, and high in beneficial MUFA (66%) and Omega-3 (9%). Refined Sunflower Oil The Refined Sunflower Oil is rich in PUFA (Polyunsaturated Fatty Acids), particularly linoleic acid that lowers the levels of both good and bad cholesterol. Hence this oil could also be used along with other cooking oils such as palmolein oil that are low in linoleic acid. It is highly popular worldwide due to its light colour, mild flavour, low SFA (Saturated Fatty Acids)and ability to withstand high cooking temperature. Emamis H&T Refined Sunflower Oil is manufactured by advanced Multi-stage European Refining Technology which removes most of impurities to maintain highest purity, and also retains plenty of natural beneficial nutrients like Vitamin E (400 mg/kg). Refined Vegetable Oil Refined Vegetable Oil (Palmolein) contains high MUFA and is rich in natural antioxidant tocotrienols, which has many health benefits against heart diseases, cancer, blood sugar etc. It is one of the best suited frying oil due to its high temp stability and less smoking characteristics. Foods cooked or fried in this oil stay fresh for long time. As it has relatively high SFA, it can be used in combination with other oils. Emamis H&T Refined Vegetable Oil is a high quality superolein manufactured by 7-Stage ERT, which helps maintain highest purity and retain plenty of natural antioxidants, tocotrienols (500 mg/kg) and Vitamin E (700 mg/kg). Blend of Soyabean & Rice Bran Oil The Soyabean & Rice Bran oil blend (65:35 ratio) provides not only the benefits of both soyabean oil and rice bran oil, but also a balanced fatty acid composition. This blend has a better fatty acid balance than soyabean oil alone. This blend of refined oils has 16.3% SFA, 22.4% MUFA and 61.3% PUFA. The Blend of Soyabean & Rice Bran oil is free from cholesterol and
trans-fat. Emamis ERT helps maintain highest purity and retains plenty of natural antioxidants, oryzanol (4200 mg/kg) and ALA-omega 3 (53 g/kg) in the blend.
LA has got various health benefits against coronary heart disease, plasma triglycerides, thrombosis, arthritis and depression. Vitamin E, a natural antioxidant, helps reduce free-radical induced cell damage. Healthy & Tasty Blend of Soyabean & Rice Bran oil has the following benefits: Free from cholesterol and trans-fat Helps lower risk of heart attack, bad cholesterol & prevents premature ageing It helps boosts immunity and makes the immune system stronger. Area of operation
Headquarter: >Pan India presence with five regional sales offices and 32 >Manufacturing units located in : Kolkata, Guwahati , Pondicherry , Vapi, Pantnagar, Talasari and Silvassa Kolkata depots
Ownership pattern Type of company In 1995, Kemco Chemicals, the partnership firm was converted into a Public Limited Company under the name and style of Emami Ltd. In 1998, Emami Ltd was merged with Himani Ltd and its name was changed to Emami Ltd as per fresh certificate of incorporation dated September1, 1998. Board of Directors The Board of Directors consists of professionals drawn from diverse fields, who bring in a wide range of skills and experience to the Board. The Companys policy is to maintain optimum
combination of Executive and Non-Executive Directors. As on March 31, 2012, the Board of Directors of Emami Limited comprised 14 Directors an Executive Chairman, a Managing Director, four Executive Directors and eight Non-Executive Directors including seven Independent Directors. Composition of the Board and category of Directors are as under:
Name and Category of Directors
Promoter Director Shri R.S. Agarwal, Executive Chairman Shri R.S. Goenka, NonExecutive Director Shri S.K. Goenka, Managing Director Shri Mohan Goenka, Wholetime Director
Independent Director Shri Viren J. Shah Shri K.N. Memani Shri Y.P. Trivedi Shri S.K. Todi
Shri Aditya Vardhan Agarwal, Wholetime Shri Amit Kiran Deb Director Smt Priti Sureka, Wholetime Director Shri S.B. Ganguly
Shri Harsha Vardhan Agarwal, Wholetime Padmashree Vaidya Suresh Chaturvedi Director
Major share holders and shares held Sl no 1 Name of the Director Shri R.S. Goenka Category of Director Promoter/NonExecutive 22 3 4 5 6 7 8 Shri Viren J. Shah Shri K.N. Memani Shri Y.P. Trivedi Shri S.K. Todi Shri Amit Kiran Deb Shri S.B. Ganguly Vaidya Independent Independent Independent Independent Independent Independent 10,200 Nil Nil 200 Nil Nil Nil Number of shares 3,12,760
Suresh Independent
Chaturvedi
Name of the Director Category of Director Number of shares
Board of director of Emami Biotech Ltd 1. Pitamber Sharan Patwari - Non-Executive Independent Director 2. Swapan Kumar Mondal - Executive Director - Finance & Administration 3. Rajiv Kumar Tibrewal - Executive Director - Finance & Procurement 4. Ghan Shyam Gupta - Executive Director - Operation & Accounts 5. Sushil Kumar Khetan - Non-Executive Independent Director
Competitors information
Infrastructural facilities
Achievements/Awards Corporate awards Ranked 144 among BT-500 Most Valuable Companies of India in the private sector (Business Today) Rated (by CARE) PR1+ (highest rating) for short-term borrowings signifying highest safety. AA+ Rating for long-term borrowings. Emami Ltd has been chosen among the top 500 companies by Inc. India 500 Awards. Brands and marketing awards Emamis power brand featured in the Brand Equity Most Trusted Brand 2011. Emami ranked 24th in Personal care category Zandu balm ranked No. 3 in the OTC personal care category Navratna ranked No. 3 in hair oil category Boroplus ranked 21st in personal care category
Fair and Handsome ranked 26th in personal care category Navratna was awarded the best packaging award by Paper Film & Foil Converters Association Quality and operations awards Pantnagar and Dongri units accredited with ISO 14001:2004 and ISO 18001:2007 accreditation signifying compliance with Environment system and Occupational Health and Safety management system IMEA (India Manufacturing Excellence Award) Silver Award for Amingaon and Abhoypur Units. Received Greentech Environment Excellence Silver Award for Abhoypur Unit. Received Best of the Best Award at CCQC Mumbai chapter for Abhoypur unit; gold Award for Amingaon unit, silver award for BT Road unit. Received Par Excellence Award at NCQC Hyderabad for Amingaon, Abhoypur and BT Road Units and Excellence Award for Pantnagar unit. Received Gold Award at CCQC Kolkata Chapter for Amingaon and BT Road units. Received Best Model Award for Kaizen implementation for Pantnagar unit by NCQC Hyderabad. BT Road unit stood first in CII Works Skill Competition - Refrigeration category (National Level). Abhoypur unit received DL Shah National Quality Award for quality initiatives. Received National Award for Technology Innovation for Mentho Plus Balm packaging under Emerging Packaging Technologies including Creative Design category. Individual recognition Forbes Asia 2011, ranked Shri R.S. Agarwal and Shri R.S. Goenka among the 100 richest Indians Mr. Naresh Bhansali, CEO-Finance, Strategy and Business Development, has been awarded the 'Best CFO Award 2012 - in Best Transformation Agent (Mid-size Companies) category' by Business Today and YES Bank.
Mr. Rajesh Sharma, Associate Vice President- Accounts & Finance, has been voted as one of the BEST CFO Investor Relations by M/s Thomson Reuters Extel.
Work flow model
Manufacturer
Company Warehouse M
Regional Distributors
Retailers
Consumers
The Emami Biotech limited has a manufacturing plant in Kolkata. The company has set up a state-of-the-art 300 tonnes per day multi-feed stock bio-diesel plant at Haldia, the largest and the first of its kind in eastern India, at a cost of Rs. 150 crore, in technical collaboration with Desmet Ballestra of Italy and from the manufacturing unit it is stored in warehouse and from there it is delivered to the distributors followed by retailers and consumers.
Future growth and Prospects
Emami also plans to set up two of its oil refineries, one in Krishnapattam in Andhra Pradesh and another one located in Gujarat. The company expects the new edible oil refineries will increase production multiple times and thus will meet the demand for the product which is rising with every passing day.
