Will consider acquisitions to enter new segments: Godrej
Google and Facebook have the same number of users. However, Google's net profit and revenue is 10 times that Facebook. Yet, at over $ 100bn, the stock market is giving a market value to Facebook that is only half of Google.
Godrej Consumer Products Ltd will consider acquisition opportunities to get into new segments, such as oral care, as it believes that getting into new verticals through normal route would be tough, according to company Chairman Adi Godrej.
"..if you ask me would we go into a business like oral care? Organically, it is unlikely, but if we have good acquisition opportunities, we would look at it," Godrej said in an analyst call.
When asked about the company's acquisition strategy going forward, Godrej said Godrej Consumer Products Ltd (GCPL) would focus on areas where it has the know-how and strength.
"Our acquisition strategy globally is to acquire in businesses, which we know very well and in which we have great strength in India," Godrej said, adding areas like hair care, household insecticides and personal wash would be priority. Speaking about India, he said the company would be open to look at acquisitions in the personal and household care space.
On the long term targets for the company, he said: "We want to be 10 times as in size in 10 years time, which is a compound annual growth rate of about 26 per cent, we hope to achieve about 15 per cent to 20 per cent organic growth and the balance through inorganic growth."
GCPL's net sales for the fiscal 2011-12 stood at Rs 4,850.94 crore while its net profit for the fiscal stood at Rs 726.72 crore. The company currently has presence in Indonesia, South America and Africa.
In January this year, the company acquired a 60 per cent stake in Chilean hair colour firm Cosmetica Nacional for an undisclosed amount.
In June 2011, GCPL had announced the acquisition of a 51 per cent stake in Darling Group Holdings.
In 2010, GCPL had bought out Latin America's Issue Group, a market leader in hair-colour in Argentina, Peru, Uruguay and Paraguay.
In less than two weeks time, the firm acquired another Argentinian hair care company Argencos. In the last couple of years, GCPL has been on an aggressive acquisition spree, buying companies in Nigeria, Indonesia, Malaysia particularly in the hair care and household insecticide space.
GCPL's portfolio includes brands like Good Knight, Cinthol, Godrej No 1, Expert, Hit, Jet, Fairglow, Ezee, Snuggy and Protekt.