Hamdard plans unit in South, Telangana on radar

The company is looking at Telangana and Andhra Pradesh and is yet to finalise the location. The company has set a Rs 60 crore capex for all its growth.

By Author   |   Published: 13th Apr 2017   8:36 am Updated: 13th Apr 2017   11:23 am
Hamdard Chief Sales and Marketing Officer Mansoor Ali launching the fusion drink in Hyderabad on Wednesday.

Hyderabad: Natural and herbal products maker Hamdard Laboratories, which is setting up its fourth unit in Aurangabad, Maharashtra with an investment of about Rs 40 crore is also contemplating to set up a new unit in South, a market that contributes 35 per cent of its revenues. The company is looking at Telangana and Andhra Pradesh and is yet to finalise the location. The company has set a Rs 60 crore capex for all its growth this fiscal (including manufacturing, R&D and market expansion).

Hamdard Laboratories’ chief sales and marketing officer, Mansoor Ali, told Telangana Today, “Hyderabad today contributes about 20 per cent of business and we want the new unit on South is close to this market. We are yet zero in the location. We are looking at a variety of possibilities for this unit. It could either come up as a green-field unit at a similar scale of the upcoming Aurangabad unit or could come up in a food processing park or a special economic zone.”

The company has three operational units now- Manesar (USFDA approved), Delhi and Ghaziabad, all in North. The Rs 700 crore company which is aiming to clock Rs 1,000 crore turnover in next three years plans to keep the Aurangabad unit ready in next 18 months and from then onwards, it will firm up plans for the South unit. All the existing units together produce around five crore bottles per annum. The new units will take care of the peak time demand.
It has applied for US FDA approvals for all of its existing units. And the regulator’s nod is awaited. “We are also complying to WHO good manufacturing practices (GMP) norms and getting the approvals,” he added.

Market dynamics
Hamdard which currently occupies 42 per cent of the syrups and concentrates market in India sees the Rs 28,000 crore beverages market growing consistently. The carbonated drinks market is estimated at Rs 10,000 crore. Hamdard is eyeing the non-carbonated market. The fruit juices segment is witnessing a growth of over 25 per cent in India annually.

It is looking at fusion products now that blends the Rooh Afza and fruit juices to woo youth. The company’s research and development team spent two years to develop the fusion products. Fusion market is estimated to be valued at Rs 18,000 crore in India.

The company has plans to introduce a product that is a combination of Rooh Afza and milk. As of today, it has wide basket of products. It is present in beverages, personal care, child care, cough and cold, and products that address lifestyle disorders.

Retail business
The company has forayed into retail business during the last fiscal. It has set up six wellness clinics across India. Of these, four are in Delhi, one each are set up in Hyderabad and Patna. Each clinic is being set up with an investment of Rs 80-90 lakh.

In the current fiscal, there are plans to add six more such clinics. All these existing and proposed stores are company owned and operated. But in future, there is scope for exploring the franchisee route.

Export markets
Talking about exports, he said, “Currently exports account for about 12 per cent of our overall business. We export to 25 countries through distribution channels. UAE, GCC and USA are the top exports markets for us. We recently obtained trade mark in Australia that will help to cater to that market.”

Going forward, the company is looking at creating indigenous products for new markets. For instance, it is developing specific products targeting Russia as there is higher incidence of liver problems.

Mansoor Ali said, “We are looking for inorganic growth. We may look at small players with promising brands in the Unani space. We may also explore cosmetics and food sector for acquisitions. We will look at opportunities in same and related businesses. We don’t intend to foray into unrelated businesses.”