Certified that this project report MARKETING STRAREGY OF
HINDSTAN !E"ER !IMITED #is the $o%afide &or' of (( # &ho carried o)t the project &or' )%der the s)per*isio% of (( +
SIGNATRE SIGNATRE DR+ R+ K G,TA MISS+ ANKITA DHAMI-A
HEAD OF THE DE,ARTMENT ,roject I%char.e
//A //A !!DIMS !!DIMS DEC!ARATION I here$0 dec1are that the project &or' e%tit1ed MARKETING STRATEGY OF HINDSTAN !E"ER !IMITED# s)$2itted to the GGS INDRA,RASTHA NI"ERSITY3 is a record of a% ori.i%a1 &or' do%e $0 2e )%der the .)ida%ce of 3 Fac)1t0 Me2$er3 !INGAYA4S !A!ITA DE"I INSTITTE OF MANAGEMENT AND SCIENCE3 a%d this project &or' has %ot perfor2ed the $asis for the a&ard of a%0 De.ree to the $est of 20 '%o&1ed.e+ 5sa*i%a06 56 5SIGNATRE OF STDENT6 ACKNO7!EDGEMENT I owe a great many thanks to a great many people who helped and supported me during the writing of this report. My deepest thanks to Lecturer, Ankita Dhamija for correcting various documents of mine with attention and care. He has taken pain to go through the project and make necessary correction as and when needed. I epress my thanks to the H!D of ""A, for etending his support. #hanks and appreciation to the helpful people at our Institute, for their support. I would also like to thank my Institute and my faculty mem$ers without whom this project would have $een a distant reality. E8ECTI"E SMMARY Hindustan Lever Limited %HLL& is India's largest (ast Moving )onsumer *oods company, touching the lives of two out of three Indians with over +, distinct categories in Home - .ersonal )are .roducts and (oods - "everages. #hey endow the company with a scale of com$ined volumes of a$out / million ecog and sales of 0s.1,,,,, crores. HLL is also one of the country's largest eporters2 it has $een recogni3ed as a *olden 4uper 4tar #rading House $y the *overnment of India. Hence, research aims is that to study the eisting marketing practices, emerging marketing plans and understanding companies $usiness strategy with its profile. #he main recommendations have $een made on the addressing of the advertising message to the customers. An attempt has $een made to formulate the communication in a way to $uild it on a platform of the $asic need for $uying HLL products. In another recommendation the suggestions towards $etter dealer interest in HLL products has $een given a chance. #he research is $ased primarily on primary data2 however few references to industry figures from secondary data have $een made. Data has $een collected through in depth interviews and administered 5uestionnaires. #he study has given the researchers an inside of the )onsumer dura$le Industry and an opportunity to use the theoretical knowledge in live project. TA/!E OF CONTENTS 9 INTRODCTION 9 (M)* 46)#!0 I7 I7DIA 18+ : RESEARCH METHODO!OGY ; 0646A0)H !"96)#I:64 ; 0646A0)H M6#H!D!L!*< ; 0646A0)H I74#0=M67# ; 0646A0)H D64I*7>8 ; DA#A )!LL6)#I!7 M6#H!D>8 ; .0IMA0< DA#A ; ; COM,ANY ,ROFI!E < "0I6( HI4#!0< ?8@ (I7A7)IAL !:60:I6A 1,81+ 4!M6 MIL64#!764 1;81B 4A!# A7AL<4I4 1@ .06467# MA0C6#I7* 4#0A#6*< +,8+/ .0I)I7* A)#I!7 I7 +,,?> +D I7:64#M67# "6HI7D "0A7D4 +? )=0067# MA0C6# )!7#6E# +F8;+ 064.!74I"ILI#I64 ;;8;B )!74=M60 4A#I4(A)#I!7 ;@8DD MA0I)! #! A)G=I06 7IHA0 (0!M HLL D? )!M.6#I#!04 DF = DATA ANA!YSIS <>(?= < CONC!SION ?< 4=**64#I!74 ?? ? !IMITATIONS ?@ @ A,,ENDI8 ?>(@A > /I/!IOGRA,HY @9
INTRODCTION FMCG SECTOR IN INDIA )onsumer Dura$le $rands may $e strong and have a good recall value $ut whether and to what etent that results in incremental sales for the company is a de$ata$le issue. A consumer's preference for )olgate or 7escafe, which results in incremental sales to the respective companies. "ut at the time of $uying a television or a refrigerator, although the strong $rand attachment is there, $etter product features, discountHechangeHfree$ie schemes going on at that point of time, a perception of superior value for money proposition and most importantly the dealers push, finally leads to the decision which may not necessarily $e the $rand with highest recall value. )ompetition may $e as intense in the (M)* sector as the )onsumer Dura$le sector, so are the $rands as strong. "ut (M)* companies' inspite of the intense competition including the competition from imports still have reasona$le amount of pricing power. .ricing power is the a$ility of a company to increase prices without significantly affecting the demand of the product. !ften aggressive price increases $y (M)* companies go unnoticed $ecause of the small unit value of the product. "ut the same cannot $e said a$out )onsumer Dura$les. 4everal $rands are fighting it out in the fragmented market $ut all either have wafer thin margins %most are into huge losses& or are competing at the cost of their profita$ility (M)* companies and )onsumer Dura$les have strong $rands, the difference lies in I"rand .ullI among most (M)* companies as against I"rand .ushI for )onsumer Dura$le companies. If a consumer has a preference for *illette it is $rand pull. "ut in the $uying decision of a consumer dura$le the dealers opinion and his push plays a very important role to an etent that it is the dealer who decides what $rand you will $uy within the parameters of $udget and product features. #herefore it is the $rand push $y the dealer. "rand .ull in a consumer dura$le would come, when a consumer develops a preference for a particular $rand. (or e.g. say an owner of a direct8cool refrigerator, later $uys the same $rand of frost8free refrigerator, or $uys other products of the same company like washing machine or television etc. (or this to happen the product attri$utes and the after sales services play a very important role. Ahile some companies lately have $een taking lot of initiatives in improving the after sales service and $etter product performance whether it has resulted in $uilding $rand loyalty is yet unclear. #o my knowledge no study has yet $een conducted on repeat purchase of consumer dura$le $rands across products. #he day it is esta$lished that $rand loyalty in this sector results in incremental sales, then may$e )onsumer Dura$le )ompanies should command $etter valuations. #he (M)* sector has shown splendid resilience in recent times. :arious companies continue to go ahead with large investments in capacity augmentation despite stagnation in the industry, a poor monsoon in +,,?8,F and conse5uent dip in rural incomes. "esides, on the anvil are $rand launches and entry into new product categories. #he performance of large players apart, even medium and smaller companies are now dictating terms and redefining the market. (M)* is an interesting and very eisting industry to work on, and hence I was fascinated to my research work on this industry. RESEARCH METHODO!OGY RESEARCH O/-ECTI"ES #he $asic o$jective $ehind carrying out this research study is #o study and analy3e the present marketing strategy followed $y HLL and .ropose effective strategies to HLL for greater market share RESEARCH METHODO!OGY #he section includes the overall research design, the sampling procedure, the data collection method, the field method, and analysis and procedure. RESEARCH DESIGNB( (or this research project eploratory method is using DATA CO!!ECTION METHODB( #he data collect for the research can $e classified as primary data and secondary data. .rimary data is $y visiting eisting customer and epected customer of Hindustan Lever Limited. And making them fill up the 5uestionnaire .4econdary data is from internet, $ooks, maga3ine etc. RESEARCH INSTRMENT #he instrument use for data collection is structured 5uestionnaire. Guestion is open and close ended depending upon the information that needed to $e elicited. I am also using the scaling techni5ue to assess the attitude of the customer. 4ampling plan>8 Ceeping all the constrains in mind a sample si3e of 1,, people .#he sampling procedure is systematic sampling HINDSTAN !E"ER !IMITED TO /ECOME HINDSTAN NI!E"ER !IMITED (M)* major Hindustan Lever on Monday said it has received governmentJs approval to change its name to IHindustan =nilever LtdI following which, its new corporate identity represented $y a new logo will come into effect. I#he identity sym$oli3es the $enefits we $ring to our consumers and the communities we work in. !ur new identity will help us confidently position ourselves in every aspect of our $usiness,I Hindustan =nilever )6! Doug "aillie said. #he new logo is sym$olic of the companyJs mission of JAdding :itality to life.J It comprises of +D different icons representing the organisation, its $rands and the idea of vitality, Hindustan =nilever said in a communi5ue to the "om$ay 4tock 6change %"46&. #he shareholders of the company had approved the proposal on May 1B. I(or us this is really an opportunity, collectively as an organisation, to renew and strengthen our commitment to continue our endeavour to earn the love and respect of India, $y making a real difference to every Indian,I "aillie added. 6arlier in (e$ruary, the company said the proposed name change would provide optimum $alance $etween maintaining its heritage and synergies of glo$al alignment with the corporate name of =nilever. Anglo8Dutch (M)* giant =nilever owns a majority stake in Hindustan Lever. =nilever set up its first Indian su$sidiary Hindustan :anaspati Manufacturing )ompany in 1@;1, followed $y Lever "rothers India Ltd %1@;;& and =nited #raders Ltd %1@;D&. #hese three companies were merged to form HLL in 7ovem$er 1@D?. 4hares of Hindustan =nilever were trading at 0s 1@+.F,, up ,.DF per cent on "46 in early morning trade. COM,ANY ,ROFI!E /RIEF HISTORY !ver 1,, yearsJ link with India In the summer of 1BBB, visitors to the Colkata har$their noticed crates full of 4unlight soap $ars, em$ossed with the words IMade in 6ngland $y Lever "rothersI. Aith it, $egan an era of marketing $randed (ast Moving )onsumer *oods %(M)*&. 4oon after followed Life$uoy in 1B@D and other famous $rands like .ears, Lu and :im. :anaspati was launched in 1@1B and the famous Dalda $rand came to the market in 1@;F. In 1@;1, =nilever set up its first Indian su$sidiary, Hindustan :anaspati Manufacturing )ompany, followed $y Lever "rothers India Limited %1@;;& and =nited #raders Limited %1@;D&. #hese three companies merged to form HLL in 7ovem$er 1@D?2 HLL offered 1,K of its e5uity to the Indian pu$lic, $eing the first among the foreign su$sidiaries to do so. =nilever now holds D1.DDK e5uity in the company. #he rest of the shareholding is distri$uted among a$out ;B,,,,, individual shareholders and financial institutions. #he erstwhile "rooke "ondJs presence in India dates $ack to 1@,,. "y 1@,;, the company had launched 0ed La$el tea in the country. In 1@1+, "rooke "ond - )o. India Limited was formed. "rooke "ond joined the =nilever fold in 1@B/ through an international ac5uisition. #he erstwhile LiptonJs links with India were forged in 1B@B. =nilever ac5uired Lipton in 1@F+, and in 1@FF Lipton #ea %India& Limited was incorporated. .ondJs %India& Limited had $een present in India since 1@/F. It joined the =nilever fold through an international ac5uisition of )hese$rough .ondJs =4A in 1@B?. 4ince the very early years, HLL has vigorously responded to the stimulus of economic growth. #he growth process has $een accompanied $y judicious diversification, always in line with Indian opinions and aspirations. #he li$eralisation of the Indian economy, started in 1@@1, clearly marked an infleion in HLLJs and the *roupJs growth curve. 0emoval of the regulatory framework allowed the company to eplore every single product and opportunity segment, without any constraints on production capacity. 4imultaneously, deregulation permitted alliances, ac5uisitions and mergers. In one of the most visi$le and talked a$out events of IndiaJs corporate history, the erstwhile #ata !il Mills )ompany %#!M)!& merged with HLL, effective from April 1, 1@@;. In 1@@D, HLL and yet another #ata company, Lakme Limited, formed a D,>D, joint venture, Lakme Lever Limited, to market LakmeJs market8leading cosmetics and other appropriate products of $oth the companies. 4u$se5uently in 1@@B, Lakme Limited sold its $rands to HLL and divested its D,K stake in the joint venture to the company. HLL formed a D,>D, joint venture with the =48$ased Cim$erly )lark )orporation in 1@@/, Cim$erly8)lark Lever Ltd, which markets Huggies Diapers and Cote 4anitary .ads. HLL has also set up a su$sidiary in 7epal, 7epal Lever Limited %7LL&, and its factory represents the largest manufacturing investment in the Himalayan kingdom. #he 7LL factory manufactures HLLJs products like 4oaps, Detergents and .ersonal .roducts $oth for the domestic market and eports to India. #he 1@@,s also witnessed a string of crucial mergers, ac5uisitions and alliances on the (oods and "everages front. In 1@@+, the erstwhile "rooke "ond ac5uired Cothari *eneral (oods, with significant interests in Instant )offee. In 1@@;, it ac5uired the Cissan $usiness from the =" *roup and the Dollops Icecream $usiness from )ad$ury India. As a measure of $ackward integration, #ea 6states and Doom Dooma, two plantation companies of =nilever, were merged with "rooke "ond. #hen in 9uly 1@@;, "rooke "ond India and Lipton India merged to form "rooke "ond Lipton India Limited %""LIL&, ena$ling greater focus and ensuring synergy in the traditional "everages $usiness. 1@@/ witnessed ""LIL launching the AallJs range of (ro3en Desserts. "y the end of the year, the company entered into a strategic alliance with the Cwality Icecream *roup families and in 1@@D the Milkfood 1,,K Icecream marketing and distri$ution rights too were ac5uired. (inally, ""LIL merged with HLL, with effect from 9anuary 1, 1@@?. #he internal restructuring culminated in the merger of .ondJs %India& Limited %.IL& with HLL in 1@@B. #he two companies had significant overlaps in .ersonal .roducts, 4pecialty )hemicals and 6ports $usinesses, $esides a common distri$ution system since 1@@; for .ersonal .roducts. #he two also had a common management pool and a technology $ase. #he amalgamation was done to ensure for the *roup, $enefits from scale economies $oth in domestic and eport markets and ena$le it to fund investments re5uired for aggressively $uilding new categories. In 9anuary +,,,, in a historic step, the government decided to award F/ per cent e5uity in Modern (oods to HLL, there$y $eginning the divestment of government e5uity in pu$lic sector undertakings %.4=& to private sector partners. HLLJs entry into "read is a strategic etension of the companyJs wheat $usiness. In +,,+, HLL ac5uired the governmentJs remaining stake in Modern (oods. In +,,;, HLL ac5uired the )ooked 4hrimp and .asteurised )ra$meat $usiness of the Amalgam *roup of )ompanies, a leader in value added Marine .roducts eports. #he mission that inspires HLLJs ;?,,,, employees, including over 1,;D, managers, is to Iadd vitality to life.I HLL meets everyday needs for nutrition, hygiene, and personal care with $rands that help people feel good, look good and get more out of life. It is a mission HLL shares with its parent company, =nilever, which holds D1.DDK of the e5uity. #he rest of the shareholding is distri$uted among ;B,,,,, individual shareholders and financial institutions. HLLJs $rands 8 like Life$uoy, Lu, 4urf 6cel, 0in, Aheel, (air - Lovely, .ondJs, 4unsilk, )linic, .epsodent, )lose8up, Lakme, "rooke "ond, Cissan, Cnorr8Annapurna, Cwality AallJs L are household names across the country and span many categories 8 soaps, detergents, personal products, tea, coffee, $randed staples, ice cream and culinary products. #hey are manufactured in close to B, factories. #he operations involve over +,,,, suppliers and associates. HLLJs distri$ution network, comprising a$out F,,,, redistri$ution stockists, directly covers the entire ur$an population, and a$out +D, million rural consumers. HLL has traditionally $een a company, which incorporates latest technology in all its operations. #he Hindustan Lever 0esearch )entre %HL0)& was set up in 1@DB, and now has facilities in Mum$ai and "angalore. HL0) and the *lo$al #echnology )entres in India have over +,, highly 5ualified scientists and technologists, many with post8doctoral eperience ac5uired in the =4 and 6urope. HLL $elieves that an organisationJs worth is also in the service it renders to the community. HLL is focusing on health - hygiene education, women empowerment, and water management. It is also involved in education and reha$ilitation of special or underprivileged children, care for the destitute and HI:8positive, and rural development. HLL has also responded in case of national calamities H adversities and contri$utes through various welfare measures, most recent $eing the village $uilt $y HLL in earth5uake affected *ujarat, and relief - reha$ilitation after the #sunami caused devastation in 4outh India. !ver the last three years the company has em$arked on an am$itious programme, 4hakti. #hrough 4hakti, HLL is creating micro8enterprise opportunities for rural women, there$y improving their livelihood and the standard of living in rural communities. 4hakti also includes health and hygiene education through the 4hakti :ani .rogramme, and creating access to relevant information through the i4hakti community portal. #he programme now covers a$out D,,,,, villages in 1+ states. HLLJs vision is to take this programme to 1,,,,,, villages impacting the lives of over a 1,, million rural Indians. HLL is also running a rural health programme L Life$uoy 4wasthya )hetana. #he programme endeavtheirs to induce adoption of hygienic practices among rural Indians and aims to $ring down the incidence of diarrhoea. It has already touched F, million people in approimately 1D,,, villages of B states. #he vision is to make a $illion Indians feel safe and secure. If Hindustan Lever straddles the Indian corporate world, it is $ecause of $eing single8 minded in identifying itself with Indian aspirations and needs in every walk of life. HI7D=4#A7 L6:60 LIMI#6D I7DIA'4 LA0*64# (M)* )!M.A7< FINANCIA! O"ER"IE7
HLL 65uity )apital 8 D, Mn M Market )apitalisation 8 F,;,, Mn M Ref: from Economic Times SOME MI!ESTONES YEAR MIL64#!764 9>>> 4unlight soap introduced in India. 9>C< Life$uoy soap launched2 Lever "rothers appoints agents in Mum$ai, )hennai, Colkata, and Carachi. 9CA: .ears soap introduced in India. 9CA; "rooke "ond 0ed La$el tea launched. 9CA< Lu flakes introduced. 9C9; :im sctheiring powder introduced. 9C9= :inolia soap launched in India. 9C9> :anaspati introduced $y Dutch margarine manufacturers like :an den "erghs, 9urgens, :erschure )reameries, and Hartogs. 9C:: 0inso soap powder introduced. 9C:= *i$$s dental preparations launched. 9C:< Lever "rothers gets full control of 7orth Aest 4oap )ompany. 9C:? Hartogs registers Dalda #rademark. 9C;A =nilever is formed on 9anuary 1 through merger of Lever "rothers and Margarine =nie. 9C;9 Hindustan :anaspati Manufacturing )ompany registered on 7ovem$er +F2 4ewri factory site $ought. 9C;: :anaspati manufacture starts at 4ewri. C;; Application made for setting up soap factory net to the :anaspati factory at 4ewri2 Lever "rothers India Limited incorporated on !cto$er 1F. 9C;= 4oap manufacture $egins at 4ewri factory in !cto$er2 7orth Aest 4oap )ompanyJs *arden 0each (actory, Colkata rented and epanded to produce Lever $rands. 9C;< =nited #raders incorporated on May 11 to market .ersonal .roducts. 9C;@ Mr. .rakash #andon, one of the first Indian covenanted managers, joins H:M. 9C;C *arden 0each (actory purchased outright2 concentration on $uilding up Dalda :anaspati as a $rand. 9C=9 Agencies in Mum$ai, )hennai, Colkata and Carachi taken over2 company ac5uires own sales force. 9C=: =nilever takes firm decision to Itrain Indians to take over junior and senior management positions instead of 6uropeansI. 9C=; .ersonal .roducts manufacture $egins in India at *arden 0each (actory. 9C== 0eorganisation of the three companies with common management $ut separate marketing operations. 9C=@ .ondJs )old )ream launched. 9C<9 Mr. .rakash #andon $ecomes first Indian Director. 4hamnagar, #iruchy, and *ha3ia$ad :anaspati factories $ought. 9C<< ?DK of managers are Indians. 9C<? #hree companies merge to form Hindustan Lever Limited, with 1,K Indian e5uity participation. 9C<@ =nilever 4pecial )ommittee approves research activity $y Hindustan Lever. C<> 0esearch =nit starts functioning at Mum$ai (actory. 9C<C 4urf launched. 9C?9 Mr. .rakash #andon takes over as the first Indian )hairman2 1@1 of the +,D managers are Indians. 9C?: (ormal 6ports Department starts. 9C?; Head !ffice $uilding at "ack$ay 0eclamation, Mum$ai, opened. 9C?= 6tah dairy set up, Anik ghee launched2 Animal feeds plant at *ha3ia$ad2 4unsilk shampoo launched. 9C?< 4ignal toothpaste launched2 Indian shareholding increases to 1/K. 9C?? LeverJs $a$y food, more new foods introduced2 7ickel catalyst production $egins2 Indian shareholding increases to 1DK. 4tatutory price control on :anaspati2 #aj Mahal tea launched. 9C?@ Hindustan Lever 0esearch )entre, opens in Mum$ai. 9C?> Mr. :. *. 0ajadhyaksha takes over as )hairman from Mr. .rakash #andon2 (ine )hemicals =nit commissioned at Andheri2 informal price control on soap $egins. 9C?@ 0in $ar launched2 (ine )hemicals =nit starts production2 "ru coffee launched 9C@9 Mr. :. *. 0ajadhyaksha presents plan for diversification into chemicals to =nilever 4pecial )ommittee 8 plan approved2 )linic shampoo launched. 9C@; Mr. #. #homas takes over as )hairman from Mr. :. *. 0ajadhyaksha. 9C@= .ilot plant for industrial chemicals at #aloja2 informal price control on soaps withdrawn2 Liril marketed. 9C@< #en8year modernisation plan for soaps and detergent plants2 9ammu project work $egins2 statutory price control on :anaspati and $a$y foods withdrawn2 )lose8up toothpaste launched. 9C@? )onstruction work of Haldia chemicals comple $egins2 #aloja chemicals unit $egins functioning. 9C@@ 9ammu synthetic Detergents plant inaugurated2 Indian shareholding increases to 1B.DFK. 9C@> Indian shareholding increases to ;/K2 (air - Lovely skin cream launched. 9C@C 4odium #ripolyphospate plant at Haldia commissioned. 9C>A Dr. A. 4. *anguly takes over as )hairman from Mr. #. #homas2 =nilever shareholding in the company comes down to D1K. 9C>: *overnment allows D1K =nilever shareholding. 9C>= (oods, Animal (eeds $usinesses transferred to Lipton. 9C>? Agri8products unit at Hydera$ad starts functioning 8 first range of hy$rid seeds comes out2 Chamgaon 4oaps unit and <avatmal .ersonal .roducts unit start production. 9C>> Launch of Lipton #aa3a tea. 9CCA Mr. 4. M. Datta takes over as )hairman from Dr. A. 4. *anguly. 1@@1 4urf =ltra detergent launched. 9CC: HLL recognised $y *overnment of India as 4tar #rading House in 6ports. 9CC; HLLJs largest competitor, #ata !il Mills )ompany %#!M)!&, merges with the company with effect from April 1, 1@@;, the $iggest such in Indian industry till that time. Merger ultimately accomplished in Decem$er 1@@/2 Launch of :im $ar2 Cissan ac5uired from the =" *roup. 9CC= HLL forms 7epal Lever Limited, HLL and =48$ased Cim$erley8)lark )orporation form D,>D, joint venture 8 Cim$erley8)lark Lever Ltd. 8 to market Huggies diapers and Cote feminine care products. (actory set up at .une in 1@@D2 HLL ac5uires Cwality and Milkfood 1,,K $randnames and distri$ution assets. HLL introduces AallJs. 9CC< HLL and Indian cosmetics major, Lakme Ltd., form D,>D, joint venture 8 Lakme Lever Ltd.2 HLL enters $randed staples $usiness with salt2 HLL recognised as 4uper 4tar #rading House. 9CC? Mr. C. ". Dadiseth takes over as )hairman from Mr. 4. M. Datta2 Merger of *roup company, "rooke "ond Lipton India Limited, with HLL, with effect from 9anuary 12 HLL introduces $randed atta2 4urf 6cel launched. 9CC@ =nilever sets up International 0esearch La$oratory in "angalore2 new 0egional Innovation )entres also come up. 9CC> *roup c4ompany, .ondJs India Ltd., merges with HLL with effect from 9anuary 1, 1@@B. HLL ac5uires Lakme $rand, factories and Lakme Ltd.Js D,K e5uity in Lakme Lever Ltd. :AAA Mr. M. 4. "anga takes over as )hairman from Mr. C. ". Dadiseth, who joins the =nilever "oard2 HLL ac5uires F/K stake in Modern (ood Industries Ltd., the first pu$lic sector company to $e disinvested $y the *overnment of India. :AA: HLL enters Ayurvedic health - $eauty centre category with the Ayush range and Ayush #herapy )entres. :AA; Launch of Hindustan Lever 7etwork2 ac5uisition of the Amalgam *roup :AA< Launch of I.ureitI water purifiers S7OT ANA!YSIS Stre%.thsB Aell8esta$lished distri$ution network etending to rural areas. 4trong $rands in the (M)* sector. Low cost operations 7ea'%essesB Low eport levels. 4mall scale sector reservations limit a$ility to invest in technology and achieve economies of scale. 4everal Ime8too'' products. Opport)%itiesB Large domestic market. 6port potential Increasing income levels will result in faster revenue growth. Fig. HLL's SWOT Analysis Weaknesses Strengths Opportunities Threats ,RESENT MARKETING STRATEGY Missio%B Hindustan Lever Limited mission is to add :itality to life. Ae meet everyday needs for nutrition, hygiene, and personal care with $rands that help people feel good, look good and get more out of life. ,o1ic0 > HLL has earned a reputation for conducting its $usiness with integrity and with respect for the interests of those their activities can affect. #his reputation is an asset, just as real as their people and $rands. #heir first priority is to $e a successful $usiness and that means investing for growth and $alancing short8term and long8term interests. It also means caring a$out their consumers, employees and shareholders, their $usiness partners and the world in which we live. (rom HLL 4pokesperson N#o succeed re5uires the highest standards of $ehavior from all of us. #he general principles contained in this )ode set out those standards. More detailed guidance tailored to the needs of different countries and companies will $uild on these principles as appropriate, $ut will not include any standards less rigorous than those contained in this )ode. Ae want this )ode to $e more than a collection of high8sounding statements. It must have practical value in their day8to8day $usiness and each one of us must follow these principles in the spirit as well as the letterO.ref: business world magazine. )ode of "usiness .rinciples 4tandard of )onduct HLL conduct their operations with honesty, integrity and openness, and with respect for the human rights and interests of their employees. #hey similarly respect the legitimate interests of those with whom we have relationships. !$eying the Law HLL companies and employees are re5uired to comply with the laws and regulations of the countries in which they operate. 6mployees HLL is committed to diversity in a working environment where there is mutual trust and respect and where everyone feels responsi$le for the performance and reputation of the company. HLL will recruit, employ and promote employees on the sole $asis of the 5ualifications and a$ilities needed for the work to $e performed. HLL are committed to safe and healthy working conditions for all employees. Ae will not use any form of forced, compulsory or child la$our. HLL are committed to working with employees to develop and enhance each individualJs skills and capa$ilities. HLL respect the dignity of the individual and the right of employees to freedom of association. HLL will maintain good communications with employees through company $ased information and consultation procedures. )onsumers HLL is committed to providing $randed products and services which consistently offer value in terms of price and 5uality, and which are safe for their intended use. .roducts and services will $e accurately and properly la$elled, advertised and communicated. 4hareholders HLL will conduct its operations in accordance with internationally accepted principles of good corporate governance. #hey will provide timely, regular and relia$le information on their activities, structure, financial situation and performance to all shareholders. "usiness .artners HLL is committed to esta$lishing mutually $eneficial relations with their suppliers, customers and $usiness partners. In their $usiness dealings they epect their partners to adhere to $usiness principles consistent with their own. )ommunity Involvement HLL strives to $e a trusted corporate citi3en and, as an integral part of society, to fulfill their responsi$ilities to the societies and communities in which they operate. .u$lic Activities HLL companies are encouraged to promote and defend their legitimate $usiness interests. HLL will co8operate with governments and other organisations, $oth directly and through $odies such as trade associations, in the development of proposed legislation and other regulations which may affect legitimate $usiness interests. HLL neither supports political parties nor contri$utes to the funds of groups whose activities are calculated to promote party interests. #he 6nvironment HLL is committed to making continuous improvements in the management of their environmental impact and to the longer8term goal of developing a sustaina$le $usiness. HLL will work in partnership with others to promote environmental care, increase understanding of environmental issues and disseminate good practice. Innovation In their scientific innovation to meet consumer needs they will respect the concerns of their consumers and of society. #hey will work on the $asis of sound science, applying rigorous standards of product safety. )ompetition HLL $elieves in vigorous yet fair competition and supports the development of appropriate competition laws. #heir companies and employees will conduct their operations in accordance with the principles of fair competition and all applica$le regulations. "usiness Integrity HLL does not give or receive, whether directly or indirectly, $ri$es or other improper advantages for $usiness or financial gain. 7o employee may offer, give or receive any gift or payment which is, or may $e construed as $eing, a $ri$e. Any demand for, or offer of, a $ri$e must $e rejected immediately and reported to management. HLL accounting records and supporting documents must accurately descri$e and reflect the nature of the underlying transactions. 7o undisclosed or unrecorded account, fund or asset will $e esta$lished or maintained. )onflicts of Interests All HLL employees are epected to avoid personal activities and financial interests which could conflict with their responsi$ilities to the company. HLL employees must not seek gain for themselves or others through misuse of their positions. )ompliance L Monitoring L 0eporting )ompliance with these principles is an essential element in their $usiness success. #he =nilever "oard is responsi$le for ensuring these principles are communicated to, and understood and o$served $y, all employees. Day8to8day responsi$ility is delegated to the senior management of the regions and operating companies. #hey are responsi$le for implementing these principles, if necessary through more detailed guidance tailored to local needs. Assurance of compliance is given and monitored each year. )ompliance with the )ode is su$ject to review $y the "oard supported $y the Audit )ommittee of the "oard and the )orporate 0isk )ommittee. Any $reaches of the )ode must $e reported in accordance with the procedures specified $y the 9oint 4ecretaries. #he "oard of =nilever will not criticise management for any loss of $usiness resulting from adherence to these principles and other mandatory policies and instructions. #he "oard of =nilever epects employees to $ring to their attention, or to that of senior management, any $reach or suspected $reach of these principles. .rovision has $een made for employees to $e a$le to report in confidence and no employee will suffer as a conse5uence of doing so. In this )ode the epressions J=nileverJ and J=nilever companiesJ are used for convenience and mean the =nilever *roup of companies comprising =nilever 7.:., =nilever .L) and their respective su$sidiary companies. #he "oard of =nilever means the Directors of =nilever 7.:. and =nilever .L)'.ref>#H6 76A4 EN"IRONMENT ,O!ICY Hindustan Lever Limited %HLL& supplies high 5uality goods and services to meet the daily needs of consumers and industry. In doing so, the )ompany is committed to ehi$it the highest standards of corporate $ehaviour towards its consumers, employees, the societies and the world in which we live. #he company recognises its joint responsi$ility with the *overnment and the .u$lic to protect environment and is committed to regulate all its activities so as to follow $est practica$le means for minimising adverse environmental impact arising out of its operations. #he company is committed to making its products environmentally accepta$le, on a scientifically esta$lished $asis, while fulfilling consumersJ re5uirements for ecellent 5uality, performance and safety. #he aim of the .olicy is to do all that is reasona$ly practica$le to prevent or minimise, encompassing all availa$le knowledge and information, the risk of an adverse environmental impact arising from processing of the product, its use or foreseea$le misuse. #his .olicy document reflects the continuing commitment of the "oard for sound 6nvironment Management of its operations. #he .olicy applies to development of a process, product and services, from research to full8scale operation. It is applica$le to all company operations covering its plantations, manufacturing, sales and distri$ution, research - innovation centres and offices. #his document defines the aims and scope of the .olicy as well as responsi$ilities for the achievement of the o$jectives laid down. THE "ISION #heir vision is to continue to $e an environmentally responsi$le organisation making continuous improvements in the management of the environmental impact of their operations. HLL will achieve this through an Integrated 6nvironment Management approach, which focuses on .eople, #echnology and (acilities, supported $y Management )ommitment as the prime driver. #he 6nvironment .olicy Hindustan Lever Ltd. %HLL& is committed to meeting the needs of customers and consumers in an environmentally sound manner, through continuous improvement in environmental performance in all their activities. Management at all levels, jointly with employees, is responsi$le and will $e held accounta$le for companyJs environmental performance. ,RICING ACTION IN :AA?B ,rice red)ctio% .rice reduction %"ottles& - :alue improvement %4achets& IN"ESTMENT /EHIND /RANDS I%%o*atio% D S)perior E)a1it0 (amily L safe .etalsoft Guick wash 8 D,K 7o mud 0in Advance from germs Aater - effort saving .erfect 0adiance ND in 1O hair #otal )are Ahiter teeth (resher $reath health $enefits CRRENT MARKET CONTE8T Actio%s P .ricing LLaundry> .rice 0eduction L4hampoos> :alue Improvement - Lower .rice .oints L#oothpaste> :alue )orrections - 4C= rationali3ation P Investments $ehind $rands L Innovations L Guality L Higher A-. P )orrective actions in processed ,rocessed Foods P )orrective actions L .hased stock reduction L Aithdrawl of Q,; innovation L Defocus of Atta in unvia$le geographies P 4ales decline of +?K arising from a$ove actions P Market shares held H improved :alue 4hares MG ',/ 9G ',/ 4G ',/ DG Q,/ 9ams FB.B FB.F F@.D FB./ Cetchup +@ +F.B +@.@ ;,.; 4alt 1D./ 1D.+ 1?.1 1D.F ,RODCTS Lu "ree3e Life$uoy Dove Liril .ears Hamam 0eona
4urf 6cel (air - Lovely 0in .ondJs Aheel
4unsilk 7aturals .epsodent )linic )lose8up
Ae Lakme 0eona Ayush
"rooke "ond
"ru
Lipton
Cissan
Cwality AallJs
Cnorr Annapurna I%diaFs !ar.est /ra%ded FMCG EGporter It was 1@?+. #he reality of India then was very different from what it is today. IndiaJs economy then suffered from foreign echange shortage. Hindustan Lever voluntarily decided to take up 6ports to support the countryJs economy. #oday, HLL is IndiaJs largest eporter of $randed (ast Moving )onsumer *oods. It has $een recognised $y the *overnment of India as a *olden 4uper 4tar #rading House. !ver time, HLL has developed appropriate capa$ilities to $e glo$ally competitive in cost and 5uality for a via$le 6ports $usiness. (ocus Areas HLLJs 6ports focuses on two $road areas. It is a sourcing $ase for =nilever $rands in Home - .ersonal )are %H.)& and #ea for supplies to other =nilever companies. It also focuses on $ecoming a preferred supplier to $oth non8=nilever and =nilever clients in three categories in which India, as a country, has competitive advantage 8 Marine .roducts, )astor and its Derivatives and 0ice. HLL enjoys international recognition within =nilever and outside for its 5uality, relia$ility and speed of customer service. HLLJs 6ports geography comprises, at present, countries in Asia, Australia, Africa, 7orth America and 6urope. HLLJs 6ports portfolio H.)> #he categories are soaps, skin care products and oral care products. #he $rands are Lu, Life$uoy, .ears, (air - Lovely, Dove, :aseline, )lose8=p, .epsodent, 4ignal. HLL is the only source of .ears soap across the world. #ea> #he categories are $randed packet tea, and instant tea for =nileverJs ready8to8drink tea $usiness. #he $randed teas are "rooke "ond, "rooke "ond 0ed la$el, "rooke "ond #aj Mahal, Lipton, Lipton <ellow La$el, Lipton *reen La$el, Lipton "risk, Lipton ;8in81 premi, )hinese 0ickshaw. Marine .roducts> HLL offers a comprehensive portfolio, ranging from 4urimi, )ra$sticks to 4hrimps and several value8added products. Among its customers is Icelandic, the worldJs third largest seafood company. In addition, HLL has also $ecome a part of =nileverJs supply chain in seafoods for 6urope too. HLLJs Marine .roducts $rands are !cean Diamond, !cean 6cellence, 4hogun, Hima, *old 4eal, #ara and .rima. 0ice> #he categories are "asmati 0ice and "asmati 0ice8$ased ready8to8eat rice meals. #he $rands are *old 4eal Indus :alley, 0o3ana and Annapurna. )astor> #he categories are )astor !il, )astor8oil $ased products, like hydrogenated castor oil, 1+ 8 Hydroy 4tearic Acid, 0icinoleic Acid %used in grease and lu$ricant industry, paints and surface coatings, cosmetics, emulsifiers&, and 4peciality )astor !ils %=4. grade, ". grade, DA" 1,& etc used in pharmaceutical preparations. HLLJs )astor $rand is #opsol. #oday, 6ports is a su$stantial $usiness in HLL, accounting for a$out 1+K of the companyJs turnover. HLL $elieves that its competitive advantages of cost competitiveness, process competitiveness and economies of scale $oth at the company and country level, hold it in good stead. #hey position the company to $ecome one of the hu$s for sourcing $y =nilever companies in H.) and #ea, and also simultaneously $ecome a preferred partner to glo$al customers in Marine .roducts, )astor and 0ice. Direct 4elling> .roduct 0ange P Lever home range P Male grooming P !ral )are P Ayurveda P .ersonal Aash P (oods 0each 8 1/,, towns %Largest in India& )onsultant $ase 8 ;;,,,,,
ACCORDING!Y3 H!!FS AIMS ARE TOB 6nsure safety of its products and operations for the environment $y using standards of environmental safety, which are scientifically sustaina$le and commonly accepta$le. Develop, introduce and maintain environmental management systems across the company to meet the company standards as well as statutory re5uirements for environment. :erify compliance with these standards through regular auditing. Assess environmental impact of all its activities and set annual improvement o$jectives and targets and review these to ensure that these are $eing met at the individual unit and corporate levels. 0educe Aaste, conserve 6nergy and eplore opportunities for reuse and recycle. Involve all employees in the implementation of this .olicy and provide appropriate training. .rovide for dissemination of information to employees on environmental o$jectives and performance through suita$le communication networks. 6nctheirage suppliers and co8packers to develop and employ environmentally superior processes and ingredients and co8operate with other mem$ers of the supply chain to improve overall environmental performance. Aork in partnership with eternal $odies and *overnment agencies to promote environmental care, increase understanding of environmental issues and disseminate good practice. RES,ONSI/I!ITIES COR,ORATE #he "oard and the Management )ommittee of HLL is committed to conduct the company operations in an environmentally sound manner. #he Management )ommittee will> Mandatory standards and esta$lish environmental improvement o$jectives and targets for HLL as a whole and for individual units, and ensure these are included in the annual operating plans. (ormally review environment performance of the company once every 5uarter. 0eview environment performance when visiting units and recognise eemplary performance. 7ominate> A senior line manager responsi$le for environmental performance at the individual HLL site. H!! EN"IRONMENTA! COORDINATOR+ #he Management )ommittee, through the nominated environmental coordinator will> 6nsure implementation of HLL .olicy on environment and compliance with =nilever and HLL environmental standards and the standards stipulated under relevant national H local legislation. Ahen $elieved to $e appropriate, apply more stringent criteria than those re5uired $y law. Assess environmental impact of HLL operations and esta$lish strategies for sound environment management and key implementation steps. 6nctheirage development of inherently safer and cleaner manufacturing processes to further raise the standards of environment performance. 6sta$lish appropriate management systems for environment management and ensure regular auditing to verify compliance. 6sta$lish systems for appropriate training in implementation of 6nvironment Management 4ystems at work. 6nsure that all employees are made aware of individual and collective responsi$ilities towards environment. Arrange for epert advice on all aspects of environment management. .articipate, wherever possi$le, with appropriate industry and *overnment $odies advising on environmental legislation and interact with national and local authorities concerned with protection of environment. Individual =nits #he overall responsi$ility for environment management at each unit will rest with the =nit Head, who will ensure implementation of HLL .olicy on environment at unit level. )oncerned line managers H heads of departments are responsi$le for environmental performance at department levels. In order to fulfill the re5uirements of the 6nvironment .olicy at each site, the =nit Head will> Designate a unit environment coordinator who will $e responsi$le for co8ordinating environmental activities at unit, collating environmental statistics and providing H arranging for epert advice. Agree with the Management )ommittee Mem$er responsi$le for the unit, specific environmental improvement o$jectives and targets for the unit and ensure that these are incorporated in the annual o$jectives of the concerned managers and officers and are reviewed periodically. 6nsure that the unit complies with =nilever and HLL mandatory standards and the relevant national and state regulations with respect to environment. 6nsure formal environmental risk assessment to identify associated environmental aspects and take appropriate steps to control risks at accepta$le levels. 6nsure that all new operations are su$jected to a systematic and formal analysis to assess environmental impact. (indings of such eercises should $e implemented prior to commencement of the activity. Manage change in .eople, #echnology and (acilities through a planned approach $ased on training, risk assessment, pre8commissioning audits and adherence to design codes. 0egularly review environment performance of the unit against set o$jectives and targets and strive for continual improvement. 4ustain a high degree of environmental awareness through regular promotional campaigns and employee participation through training, safety committees, emergency drills etc. 6nsure dissemination of relevant information on environment within the unit and to outside $odies, and regularly interact with *overnment authorities concerned for protection of environment. Maintain appropriate emergency procedures consistent with availa$le technologies to prevent H control environmental incidents. .rovide appropriate training to all employees. 6nsure periodic audits to verify compliance with environment management systems and personally carry out sample environment audits to check efficacy of the systems. 0eport environmental statistics to HLL )orporate 4afety - 6nvironment *roup on a monthly $asis. 0esearch and Innovation )entres 4ince most new products and processes are developed in these =nits, certain additional 0esponsi$ilities devolve on them to ensure implementation of the 6nvironment .olicy of the company. In addition to the =nit HeadJs responsi$ilities outlined a$ove, the heads of these units will> 6nsure that a formal and systematic risk assessment eercise is undertaken during the processHproduct development stage with specific reference to environmental impact. #ransfer technology to the pilot plant and main production through a properly documented process specification which will clearly define environmental impact and risks associated with processes, products, raw material and finished product handling, transport and storage. 6nsure that treatment techni5ues are developed for any wastes generated as a result of the new productHprocess and is incorporated into the process specifications. EA!ITY ,O!ICYB Hindustan Lever Limited considers 5uality as one of the principal strategic o$jectives to guarantee its growth and leadership in the markets in which it operates. #he company is committed to respond creatively and competitively to the changing needs and aspirations of their consumers through relentless pursuit of technological ecellence, innovation and 5uality management across their $usinesses, and offer superior 5uality products and services that are appropriate to the various price points in the market as well as to their commitment to $uilding shareholder value. #he company recognises that its employees are the primary stheirce of success in its operations and is committed to training and providing them the necessary tools and techni5ues as well as empowering them to ensure $road $ase compliance of this policy in the organisation at all levels. #he company is committed to fulfill its legal and statutory o$ligations and international standards of product safety and hygiene and will not knowingly sell product that is harmful to consumers or their $elongings. It will institute systems and measures to monitor compliance in order to meet its responsi$ilities to consumers. #he company will maintain an open communication channel with its consumers and customers and will carefully monitor the feed$ack to continuously improve its products and services and set 5uality standards to fulfill them. #he company is committed to etend its 5uality standards to its contract manufacturers, key suppliers and service providers and $y entering into alliances with them, to jointly improve the 5uality of its products and services. #his policy is applica$le to production from its own facilities as well as to production that is outstheirced. #he company will periodically review this 5uality policy for its effectiveness and consistency with $usiness o$jectives. #he company delegates authority and responsi$ility for dissemination and implementation of this policy to each "usiness and =nit Head. SAFETY AND HEA!TH ,O!ICY I%trod)ctio% Hindustan Lever Limited %HLL& supplies high 5uality goods and services to meet the daily needs of consumers and customers. In doing so, the )ompany is committed to ehi$it the highest standards of corporate $ehavior towards its consumers, employees, the societies and the environment in which we operate. #owards this, the )ompany recognises its responsi$ility to ensure safety and protection of health of its employees, contractors and visitors in all its operating sites, which include manufacturing, sales and distri$ution, research la$oratories and offices during work and work related travel. #his .olicy document defines the vision, principles, aim, re5uired actions and scope of the policy application as well as the responsi$ility for eecution. Their "isio% #heir vision is to $e an injury free organisation. HLL 76A4>OAe will $ring safety on top of mind for all employees and will integrate it with all $usiness processes. Ae will realise their :ision through an Integrated 4afety Management approach, which focuses on .eople, .rocesses, 4ystems, #echnology and (acilities, supported $y demonstrated leadership and employee commitment at all levels as the prime drivers for ensuring a safe and healthy work environmentO. Safet0 ,ri%cip1esB HLLJs !ccupational 4afety and Health .olicy is $ased on and supported $y the following eight .rinciples. #hese .rinciples have the same status as the )ompanyJs )ode of "usiness .rinciples> All injuries and occupational illnesses are preventa$le All operational eposures can $e safeguarded 4afety evaluation of all $usiness processes is vital Aorking safely is a condition of employment #raining all employees to work safely is essential Management audits are a must 6mployee involvement is essential All deficiencies must $e reported and corrected promptly In order to facilitate operationalisation of the 4afety .rinciples, a separate document has $een prepared, which covers> a& 4afety .rinciples $& 4uccess )riteria c& Illustrative C.I CONSMER SATISFACTION Indira is +, years old, a tri$al woman at Condegaon village in "astar district. 4he is just $ack from the near$y jungles, collecting firewood. After attending to her $a$y son, she will go to the village well to take a 5uick wash. <esterday her hus$and $rought her a white soap, with pink petals in it. Indira had re5uested him to $uy one, for the festival later this evening. Indira is among millions of consumers in rural India who use Hindustan LeverJs products. 4he came to know a$out Lu through the #: set at the community centre. It is not very costly, and also availa$le near$y. Home to over F,, million people, rural India comprises not only over F,K of IndiaJs $illion8strong population, $ut also over 1+K of the worldJs population. #he rural population already accounts for su$stantial consumption of (ast Moving )onsumer *oods and also consumer dura$les. A$out D,K of the sales of soaps - detergents are generated in rural India. 4imilarly, almost half the demand for $lack - white television sets, pressure cookers, ta$le fans, sewing machines also comes from there. COST MANAGEMENTB "ut the potential is even larger, $oth in terms of consumption and penetration. #he fact that F,K of the population accounts for only D,K of even relatively well8penetrated categories, like soaps - detergents, indicates the enormous scope of consumption8led growth in these categories. #herefore such categories will derive growth out of increased usage. In categories, which are relatively less penetrated, like personal products, rural India offers an even $igger growth opportunity through greater penetration and then consumption. (or eample only three out of 1, consumers in rural markets use shampoo or skin care products. #herefore growth in such categories will emerge, as more consumers purchase these products, and then continue to use them regularly. Hindustan Lever has taken many initiatives over the decades to create markets in the rural hinterlands. "y marketing relevant products, at afforda$le prices. A uni5ue eample is Hindustan LeverJs Life$uoy soap. In rural India, health is of paramount importance, $ecause indisposition is very directly related to loss of income. Life$uoy, whose core e5uity is health and hygiene , has for decades now $een synonymous with soap in rural India. At the same time, if products have to come up the order in the rural purchase hierarchy, they have to $e afforda$le. If rural India today accounts for a$out half of detergents sales, it is $ecause HLL has developed low8cost value8for8money $randed products, like Aheel. #he company has also taken initiatives to create markets even for apparently premium products, $y offering them in pack si3es, like sachets, whose unit prices are within the reach of rural consumers. (or eample, initiated in the 1@B,s, sachets %0s.+, 0e.1, or D, paise& today constitute a$out DDK of Hindustan LeverJs shampoo sales. Aith media reach gradually increasing, rural consumers today, where the media has its footprints, share the same aspirations with their ur$an counterparts. HLL has responded to the trend with low unit price packs of even other products 8 Lu at 0s.D, Life$uoy at 0s.+, 4urf 6cel sachet at 0s.1.D,, .ondJs #alc at 0s.D, .epsodent toothpaste at 0s. D, (air - Lovely 4kin )ream at 0s.D, .ondJs )old )ream at 0s.D, "rooke "ond #aa3a tea at 0s.D. !ther marketing strategies> (or decades now, Hindustan Lever has also taken initiatives to circumvent the limitation in communication channels, $y innovatively leveraging non8conventional media. Among them are wall paintings, cinema vans, weekly markets %haat&, fairs and festivals. *iven the rural consumerJs fascination for cinema, the cinema vans show popular movies, interspersed with products advertisements. Aeekly markets, fairs and festivals are parts and parcel of rural life. #hey give an opportunity to address consumers, spread over many tiny hamlets, at one location. #he occasions are used to demonstrate product $enefits and also sell such products. 4uch demonstrations have played a significant role in creating, for eample, the detergents market in rural India. In recent times, such demonstrations are $eing deployed to illustrate how visi$le clean is not hygienic clean, and how using soap is essential to prevent easily avoida$le infections. )ommunication through fairs and festivals are $acked $y direct consumer contact. (or eample, in 1@@B8@@, Hindustan Lever implemented a major direct consumer contact, called .roject "harat, which covered +.+ crore homes. 6ach home was given a $o, at a special price of 0s.1D, comprising a low unit price pack of shampoo, talcum powder, toothpaste and skin cream, along with educational leaflets and audio8visual demonstrations. #he project has helped eliminate $arriers to trial, and has strengthened salience of $oth particular categories and $rands. 4imilarly in +,,+, Hindustan Lever has launched a similar large8scale direct contact, called Life$uoy 4wasthya )hetana, which already covers F, million people in 1B,,,, villages of B states. #he project is intended at generating awareness a$out good health and hygiene practices, and specifically how a simple ha$it of washing hands is essential to maintaining good health. #he initiative will involve interaction with students and senior citi3ens, who act as change agents. Availa$ility of HLL's .roduct> *enerating awareness pays dividends only when steps are taken to ensure constant availa$ility of products. In rural India particularly, availa$ility determines volumes and market share, $ecause the consumer usually purchases what is availa$le at the outlet, influenced very largely $y the retailer. #herefore, over the decades, Hindustan Lever has progressively strengthened its distri$ution reach in rural India, which today has a$out ;; lakh outlets. Direct rural distri$ution in Hindustan Lever $egan with the coverage of villages adjacent to small towns. #he companyJs stockists in these towns were made to use their infrastructure to distri$ute products to outlets in these villages. "ut this distri$ution mode could only $e etended to villages connected with motora$le roads, and it could cover a$out +DK of the rural population $y 1@@D. #herefore in 1@@B, Hindustan Lever launched .roject 4treamline to further etend its distri$ution reach. =nder this initiative, the company identifies su$8stockists in a large village, connected $y motora$le road to a small town. #his su$8stockist in turn distri$utes the companyJs products to outlets in adjacent smaller villages using transportation suita$le to interconnecting roads, like cycles, scooters or the age8old $ullock cart. Hindustan Lever is thus trying to circumvent the $arrier of motora$le roads. As a result, the distri$ution network, as of now, directly covers a$out D,,,,, villages, reaching a$out +D, million consumers. #he company simultaneously uses the wholesale channel, suita$ly incentivising them to distri$ute company products. HLL has in the recent past esta$lished a common distri$ution system in rural areas for all its products. *iven the num$er of $rands and their packs the rural retailer usually re5uires, one HLL representative can take all the products from the company portfolio that he needs. #his common distri$ution system is now fully operational, under one 0egional 4ales Manager eclusively dedicated to rural markets of each region of the country. !ver time, Hindustan Lever will further strengthen its rural distri$ution through mutually $eneficial alliances with rural 4elf Help *roups %4H*s&. !ver the last five years, financial institutions, 7*!s and government organisations are working closely to esta$lish 4H*s, whose o$jective is to alleviate poverty through sustaina$le income8 generating activities. 4ince +,,1, Hindustan Lever is implementing .roject 4hakti, where$y 4H*s are $eing offered the option of distri$uting relevant products of the company as a sustaina$le income8generating activity. #he model hinges on a powerful win8win relationship2 the 4H* engages in an activity which $rings sustaina$le income, while Hindustan Lever gets an interface to interact and transact with the rural consumer. HLLJs vision for .roject 4hakti is to scale it up across the country $y +,,D, creating a$out +D,,, 4hakti entrepreneurs, covering 1,,,,,, villages, and touching the lives of 1,, million rural consumers. "egun with D, groups in 7algonda district of Andhra .radesh, with the support of local authorities, the project has $een etended, as of now, to a$out D,,,,, villages in 1+ states. A typical 4hakti entrepreneur conducts $usiness of around 0s.1,,,,, 8 0s 1D,,,, per month, which gives her an income of a$out 0s F,, 8 0s.1,,, per month on a sustaina$le $asis. As most of these women are from $elow the poverty line, and live in etremely small villages %less than +,,, population&, this earning is very significant, and is almost dou$le of their past household income. #he full $enefit of .roject 4hakti will $e realised after some years. H!! S,,!Y CHAIN NATION 7IDE MANFACTRING> B, factories, across India #he year was 1@+;. Lord Leverhulme, the legendary founder of Lever "rothers, was visiting India. #he nationalist sentiment in India was for locally manufactured products. Lord Leverhulme, who $elieved that what is good for a country is e5ually good for the company, responded to that aspiration $ecause he too shared that dream. His dream ultimately was realised in 1@;/. In 4eptem$er 1@;/, after more than a decade of discussions in London and in India, a Lever factory was allowed to sprout on the land that had $een reclaimed $y the "om$ay .ort #rust at 4ewri. (rom here, a month later rolled out the first cake of 4unlight soap to $e manufactured in India. #he same year, Lever "rothers took over the *arden 0each (actory in Colkata. #hese two factories were the first in a manufacturing $ase, which today literally dots the length and $readth of India. (rom Assam to *ujarat, from =ttaranchal to Cerala. Hindustan LeverJs diverse product range is today manufactured in a$out B, factories. In addition, the company outsources from 1D, other units. #he operations involve +,,,, suppliers and associates. Ma%)fact)ri%. Company Supply Persons Company Supply Persons Company Supply Persons Company Supply Persons Wholeseller Family Grocer Kiosk Supermarkets De*e1opi%. $ac'&ard areas 4everal HLL factories are situated in $ackward areas. #he company has consciously responded to the national policy of development of $ackward areas $y setting up manufacturing units in these places, which provide several direct and indirect employment opportunities for these areas, and leads to general economic development of these regions through industrialisation. In fact, all major investments of HLL, in recent years, have $een either in A8)ategory $ackwad areas or 7o8Industry Districts. #hese include factories in Chamgaon and <avatmal %Maharashtra&, )hhindwara %Madhya .radesh&, !rai, 4umerpur and Chalila$ad %=ttar .radesh&, Haldia %Aest "engal&, 4ilvassa %Dadra - 7agar Haveli&, .ondicherry, *oa, Doom Dooma %Assam&, Haridwar %=ttaranchal& and "arotiwala %Himachal .radesh&. 4ince +,,1 itself, HLL has set up nine new factories in $ackward areas. 65ually, HLL has an envia$le track record in taking over sick enterprises, in response to re5uests from *overnment, and converting them into via$le operations. #he companyJs units at Mangalore and 0ajpura all $ear testimony to this achievement. In the process, HLL has saved precious jo$s and developed local economies. HLLJs manufacturing facilities, like the Chamgaon soap plant and the 4umerpur detergent $ar unit, are recognised as among the $est in the =nilever world. HLL has adopted #otal .roductive Maintenance %#.M& for achieving manufacturing ecellence since 1@@/. As on date, #.M is in different stages of implementation in +B factories. (our HLL factories have already received the #.M )onsistency Award, and 1/ factories have $een awarded with the #.M 6cellence Award. MARKETING NEEDS E"ERY 7HERE How do you ensure that Mr. 0amesh in Canyakumari gets his Life$uoy soap and Mrs. Culkarni in 9ammu gets to know how "ru coffee tastes even $efore she has $ought itR Aell, you need to have a cutting edge distri$ution network in place. Hindustan LeverJs distri$ution network is recognised as one of its key strengths. Its focus is not only to ena$le easy access to our $rands, $ut also to touch consumers with a three8 way convergence 8 of product availa$ility, $rand communication, and higher levels of $rand eperience. HLLJs products, manufactured across the country, are distri$uted through a network of a$out F,,,, redistri$ution stockists covering a$out one million retail outlets. #he distri$ution network directly covers the entire ur$an population. #he general trade comprises grocery stores, chemists, wholesale, kiosks and general stores. Hindustan Lever services each with a tailor8made mi of services. #he emphasis is e5ually on using stores for direct contact with consumers, as much as is possi$le through in8store facilitators. AT THE S,ERMARKETS 4elf8service stores and supermarkets are fast emerging in metros and large towns. #o service modern retailing outlets in the metros, HLL has set up a full8scale sales organisation, eclusively for this channel. #he $usiness system delivers ecellent customer service, while driving growth for the company and the store. At the same time, innovative marketing initiatives are taken to provide consumers with eperience of our $rands at the store itself, through product tests and in8store sampling. IN THE "I!!AGES HLL has also revamped its sales organisation in the rural markets to fully meet the emerging needs and increased purchasing power of the rural population. #he company has $rought all markets with populations of $elow D,,,,, under one rural sales organisation. #he team comprises an eclusive sales force and eclusive redistri$ution stockists, under the charge of dedicated managers. #he team focuses on $uilding superior availa$ility, while ena$ling $rand $uilding in the deepest interiors. HLLJs distri$ution network in rural India already directly covers a$out D,,,,, villages, reaching a$out +D, million consumers, through a$out ?,,, su$8stockists. HARNESSING INFORMATION TECHNO!OGY An I#8powered system has $een implemented to supply stocks to redistri$ution stockists on a continuous replenishment $asis. #he o$jective is to catalyse HLLJs growth $y ensuring that the right product is availa$le at the right place in right 5uantities, in the most cost8effective manner. (or this, stockists have $een connected with the company through an Internet8$ased network, called 047et, for online interaction on orders, despatches, information sharing and monitoring. 04 7et covers a$out B,K of the companyJs turnover. #oday, the sales system gets to know every day what HLL stockists have sold to almost a million outlets across the country. 04 7et is part of .roject Leap, HLLJs end8to8end supply chain, which also includes a $ack8end system connecting suppliers, all company sites and stretching right upto stockists. ,IONEERING NE7 CHANNE!S Hindustan Lever is simultaneously creating new channels, designed on the same principle of holistic contact with consumers. .roject 4hakti, HLLJs partnership with 4elf Help *roups of rural women, is $ecoming an etended arm of the companyJs operation in rural hinterlands. 4tarted in +,,1, .roject 4hakti has already $een etended to a$out D,,,,, villages in 1+ states 8 Andhra .radesh, Carnataka, *ujarat, Madhya .radesh, #amil 7adu, )hattisgarh, =ttar .radesh, !rissa, .unja$, 0ajasthan, Maharashtra and Aest "engal. #he respective state governments and several 7*!s are actively involved in the initiative. #he 4H*s have chosen to partner with HLL as a $usiness venture, armed with training from HLL and support from government agencies concerned and 7*!s. Hindustan Lever 7etwork %HL7& is the companyJs arm in the Direct 4elling channel, one of the fastest growing in India today. It already has a$out ;.D lakh consultants 8 all independent entrepreneurs, trained and guided $y HL7Js epert managers. HL7 has already spread to over 1D,, towns and cities, covering B,K of the ur$an population, $acked $y /+ offices and +/, service centres across the country. It presents a range of customised offerings in Home - .ersonal )are and (oods. !ut8of8Home consumption of products and services is a growing opportunity in India, as elsewhere in the world. Hindustan Lever is already the largest player in the hot $everages out8of8home segment, with over 1D,,, tea and coffee vending points. #he company is epanding the network aggressively, in the education, entertainment, leisure and travel segments. HLLJs allaince with .epsi will significantly strengthen this channel. Health - "eauty 4ervices are Hindustan LeverJs simultaneous foray to meet the increasing consumer need for such products and services. Lakme 4alons provide specialised $eauty services and solutions, under the recognised authority of the Lakme $rand. #he Ayush #herapy )entres provide easy access to authentic Ayurvedic treatments and products. Hindustan Lever, which once pioneered distri$ution in India, is today reinventing distri$ution 8 creating new channels, and redefining the way current channels are serviced. In the process it is converging product availa$ility, with $rand communication and $rand eperience. NO"E! ,RODCT NE7 ,ROCESS Hindustan LeverJs mission is to meet everyday needs for nutrition, hygiene, and personal care, with $rands that help people feel good, look good and get more out of life. HLLJs research - development $ase, one of the largest in Indian industry, helps achieve this mission, with novel products and new processes. #he company has over ;B, patents, demonstrating its leading edge in consumer8relevant 0-D. #he Hindustan Lever 0esearch )entre %HL0)&, with facilities in Mum$ai and "angalore, and glo$al technology centres in India have over +,, highly 5ualified scientists and technologists, many with post8doctoral eperience ac5uired in the =4 and 6urope. 4et up in 1@DB, HL0)Js aim is to develop new products and processes, improving $enefits and 5uality of eisting products, and optimal use of resources. Major innovations have taken place, down the decades, in every category in which HLL is present. (rom Home )are to .ersonal care, "everages to (oods. "etter cleaning, lesser water consumption )onsider for eample, HLLJs development of a water8saving technology for its detergents. !ne of the most severe pro$lems that India faces today is shortage of water. Aater scarcity affects one in every three Indians. In a typical Indian home, at least +,K of the water consumed goes $ehind washing of clothes. HLL decided that it would $e of immense $enefit to an Indian household, if a technology could $e developed, which would help reduce water consumed in washing of clothes. HLLJs scientists have innovated a path8$reaking technology 8 it reduces water consumption and time taken for rinsing $y D,K. #he technology has already $een introduced. AorldJs most advanced water purifier .eople in cities and towns spend enormous amounts, either in fuel or devices, to ensure safe drinking water. HLLJs scientists have developed a $reakthrough device, called I.ureitI, which purifies water as safe as $oiled water, providing 1,,K protection from all water8$orne diseases2 it also removes pesticides that may $e present in drinking water. Its operation does not re5uire electricity, running tap water and plum$ing or epensive maintenance. It thus provides water at a cost of just 0e.1 for every si litres 8 or less than +, paise a litre. Iodine In 4alt 8 the vital ingredient Iodine, it is well8known, is important for the mental development of young children. Iodised salt is a well8accepted mode of ensuring appropriate iodine intake. <et Iodine added to salt is lost in transport, storage as well as in the process of cooking. HLL scientists have developed a patented $reakthrough technology to sta$ilise iodine in salt, following work on the sta$ility of iodine under Indian conditions of storage and cooking. #he technology has made it possi$le to actually realise the purpose of iodised salt 8 that people get appropriate iodine intake through the food they eat. #echnology of skin lightening 0esearch in the $iology of skin pigmentation has led to the formulation of a product like (air - Lovely 4kin )ream and Lotion. #he product has $een periodically updated through new patented actives. It has now $ecome a glo$al success through eports to over ;, countries. #he product is e5ually used $y the local population of these countries, apart from those of Indian origin. HLL has e5ually developed new processes. In8house machine development #he company has the capa$ility to design and manufacture machines in8house. #his ena$les the company to set up plants at half the cost of others. 4uch technological developments have also led to significant improvement in productivity. 6nergy conservation In the past, one of the most significant $reakthroughs of HLLJs research initiative has $een the development of a technology to use non8conventional forest seed oils for soap8 making which, since the 1@F,s, has helped save around M1.+ $illion in foreign echange. HLL had received the *overnment of IndiaJs prestigious award for import su$stitution. Development of 4tructurant #echnology for soap manufacturing also helped save costly conventional oils without any compromise on product performance and 5uality. #he latest technology to produce Distilled (atty Acid for soap making and the resultant plant capacity epansion has drastically $rought down specific energy consumption while improving distillation yields. #he evolution of continuous soap processing technology has also reduced energy consumption. HLL $elieves that technology is critical to delight consumers. )reative application of technology has made Hindustan Lever successful in launching products and services, which raise the 5uality of life. HE!,ING HANDSB HLL )!MMI#4 0s. B )0!064 (!0 IMM6DIA#6 06LI6(, 06HA"ILI#A#I!7 #! #4=7AMI8HI# )!MM=7I#I64 M=M"AI, 9anuary F, +,,D> Hindustan Lever Limited %HLL& today announced to commit, a total outlay of 0s.B crores for immediate relief and helping people to reha$ilitate themselves so that they can resume their livelihood, in the tsunami8hit areas of .ondicherry, #amil 7adu and Cerala. !f this, 0s.D crores %a$solute value terms& is $eing utili3ed for distri$ution of the )ompanyJs nutritional - personal hygiene products for immediate relief to the needy. Another 0s.; crores will $e raised partly $y contri$utions from company employees and the $alance contri$ution from the )ompany to $e used in colla$oration with 7*!s working with the community to provide the people, nota$ly fishermen, with means of livelihood and help them $ack on their feet. 4ince Decem$er +?, employees of HLL factories and offices in .ondicherry, #amil 7adu and Cerala have $een providing necessary relief to the tsunami8hit people. #he relief operations include, distri$ution of $read and $iscuits to over +,,, families in .ondicherry, 1+,,,, cooked meals for families in )hennai, 7agapattinam, )uddalore and Andamans. !ver 1+,,,, dry relief packs, comprising of )ompanyJs dry rations and personal hygiene products have already $een distri$uted. HLLJs employees are donating a dayJs salary, matched e5ually $y the )ompany for eclusive use in reha$ilitation. #he $iggest concern is, that peopleH fishermen have lost their means of livelihood. HLL plans to focus its reha$ilitation efforts to restore their means of livelihood so that the local communities can 5uickly get $ack to their lives at the earliest. HLL has always $een a front runner in its call for national duty and caring for the community. Its employees not only donate generously, $ut volunteer to take part in relief operations $y committing their time and physical effort. #his is in line with our corporate value of NcareO and our )40 mission which has $ecome an integral part in our way of doing $usiness. 6arlier during the *ujarat earth5uake, HLL had adopted and reconstructed a new village, <ashodadham, in "hachau #aluka of Cutch district. <ashodadham, spread over +D acres, comprises +B@ homes, school $uilding, an eclusive playground for children and a multi8 purpose community centre, including an anganwadi %creche&, health centre, community room and panchayat office, an underground reservoir and an overhead tank for water. All the dwelling units have electricity, and piped water and are now fully occupied. HLL is IndiaJs largest (ast Moving )onsumer *oods company, touching the lives of two out of three Indians. HLL's mission is to Nadd vitality to lifeI through its presence in over +, distinct categories in Home - .ersonal )are .roducts and (oods - "everages. #he company meets everyday needs for nutrition, hygiene, and personal care, with $rands that help people feel good, look good and get more out of life. 4pecial 6ducation - 0eha$ilitation =nder the Happy Homes initiative, HLL supports special education and reha$ilitation of children with challenges. ASHA DAANB #he initiative $egan in 1@F?, when HLL supported Mother #eresa and the Missionaries of )harity to set up Asha Daan, a home in Mum$ai for a$andoned, challenged children, and the destitute. 4u$se5uently, Asha Daan has also $ecome a home to the HI:8positive. #he o$jective in supporting Asha Daan was and continues to $e to share the organsationJs prosperity in supporting the MotherJs mission of serving the Ipoorest of the poorI. Asha Daan has $een set up on a F+,D,,8s5uare feet plot $elonging to HLL, in the heart of Mum$ai city. HLL $ears the capital and revenue epenses for maintenance, upkeep and security of the premises. #he destitute and the HI:8positive are provided with food, shelter and medication for the last few days of their lives. #he needs of the a$andoned challenged children are also met through special classes of $asic skills, physiotherapy and, if possi$le, corrective surgery. At any point of time, it takes care of over ;,, infants, destitute men and women and HI:8positive patients. !ver the years, HLL has opened schools for challenged children with a sharper o$jective of supporting families of such children, helping the children $ecome self8reliant $y learning appropriate skills to $e productive mem$ers of the household. ANKRB In 1@@;, HLLJs Doom Dooma .lantation Division set up Ankur, a centre for special education of challenged children. #he centre takes care of children with challenges, aged $etween D and 1D years. Ankur provides educational, vocational and recreational activities to over ;D children with a range of challenges, including sight or hearing impairment, polio related disa$ilities, cere$ral palsy and severe learning difficulties. #hese physically and mentally challenged children are taught skills, such as cookery, painting, em$roidery, $am$oo crafts, weaving, stitching, etc depending on their aptitudes. #he centre has reha$ilitated 1, children, including self8employment for ? children $y providing them with shops, and ; girls have $een provided employment as creche attendants. It has also moved to normal schools 1B children. 4ince inception it has covered a$out B, children. Ankur received the Lawrie *roup Aorldaware Award for 4ocial .rogress in 1@@@ from H0H .rincess 0oyal in London. KA,,AGAMB 6ncouraged $y AnkurJs success, Cappagam %IshelterI&, the second centre for special education of challenged children, was set up in 1@@B on HLL .lantations in 4outh India. It has 1F children. #he focus of Cappagam is the same as that of Ankur. #he centre has 1F children, $eing taught self8help skills, useful vocational activities like making of paper covers, greeting cards, wrapping papers, fancy stationery, napkins, $rooms made out of coconut leaves, candles, and also some home care products. A$out 1+ of the children have $ecome relatively self8reliant $y earning through crafts learnt at the centre. 4ince inception, it has covered a$out +B children. AN/AGAMB <et another day care center, An$agam %Ishelter of loveI&, has $een started in +,,; also in the 4outh India .lantations. It takes care of 11 children. "esides medical care and meals, they too are $eing taught skills such that they can $ecome self8reliant and elementary studies. !ver +,,,,, individuals have $enefitted from the Happy Homes initiatives since inception. HLL is wholeheartedly involved with all four centres and will continue to $e involved in the future. HINDSTAN !E"ER !IMITED H DECEM/ER EARTER :AA< RES!TS #otal 4ales grow $y 1/./K2 (M)* 4ales growth at 1D.BK H.) and (oods grow $y 1FK and @K respectively2 "road $ased growth across categories ."I# grows 1;.DK2 7et .rofit increases $y D?K 6.4 for +,,D grows 1F.?K2 (inal Dividend 0s +.D, per share of 0e 1H8 each2 #otal Dividend 0s D.,, per share for +,,D M)2$ai3 Fe$r)ar0 9=3 :AA?B Hindustan Lever Limited %HLL& announced its results for Decem$er Guarter +,,D. *rowth momentum achieved in the last three 5uarters has $een sustained with total sales growing $y 1/./K. Domestic (M)* sales were higher $y 1D.BK with $oth Home and .ersonal )are %H.)& and (oods performing well. H.) $usiness grew $y 1F.;K driven $y strong performance in all categories. 4ignificant sales growth was achieved in the highly competitive categories of Laundry and 4hampoo. 4oaps recorded good growth, with Lu growing handsomely reflecting in market share gains. All the $rands in 4kin category maintained their strong performance leading to a dou$le digit growth for the category. )onsumer relevant innovations continue to drive off8take and key innovations during the 5uarter include the re8launch of N#hick and 4trongO 4unsilk .ink, Lu variants for the FD8year cele$rations, and the national launch of N9asmine (reshO 0in Advanced .owder. In (oods $usiness, #ea achieved a modest growth despite a declining market and falling commodity prices2 )offee continued to perform well. .rocessed (oods $usiness grew strongly, al$eit on a low $ase. #he Icecream $usiness also achieved a ;;K increase in sales, led $y the impulse category. 0elaunch of Cnorr soup with a superior mi and introduction of new variants was the key (oods innovation during the 5uarter. .rofit $efore Interest and #aes %."I#& increased $y 1;.DK after a$sor$ing a D,K higher spend in Advertising and .romotions. Higher crude oil price led cost pressures continued, particularly in Laundry category, $ut were mitigated $y aggressive cost effectiveness programs. .rofit after ta %.A#& grew $y ++.FK due to a lower effective ta rate and 7et profit, including the impact of eceptional items was higher $y D?K. For f)11 0ear :AA<, total sales were 11./K higher than in the previous year, with $road $ased growth across categories leading to $oth H.) and (oods $usinesses growing $y 1/K and BK, respectively. 9udicious price increases coupled with ro$ust cost saving initiatives partly neutralised the impact of $oth cost escalations, particularly in the Laundry category, and the higher investments $ehind $rands. )onse5uently, ."I# increased $y 1.1K. A lower ta charge for the year resulted in a .A# growth of 1+.@K. 7et .rofit and 6arnings .er 4hare at 0s ?./,, grew $y 1F.?K. Mr Harish Manwani, )hairman commented> NAe have sustained the growth momentum in Decem$er 5uarter and it continues to $e $road $ased across H.) and (oods categories, particularly, in the competitive categories of Laundry and 4hampoo. #his was driven $y higher investment $ehind our $rands with eciting innovations, ecellent activation, new initiatives in )ustomer Management and with significantly higher levels of A-. spends. #he dou$le digit sales growth of over 11K for the year +,,D has $een achieved after a gap of si years. !ur strategic priority remains unchanged. Ae will continue to leverage our focused portfolio of powerful $rands to sustain market leadership and grow our market position across strategic $rands and categories. In a competitive landscape, we shall continue to deliver consumer value and invest $ehind our $rands. Ae recogni3e the challenge of inflationary cost pressures driven $y crude oil prices and, in the competitive contet, achieving cost leadership across the etended supply chain continues to $e a key priority.O DI"IDEND #he "oard of Directors at their meeting held on (e$ruary 1/ th , +,,? has proposed a final dividend of 0s +.D, per share of 0e 1 each, su$ject to the approval of the shareholders at the annual general meeting. #his along with the interim dividend of 0s +.D, per share amounts to a total dividend of 0s D.,, per share for the year +,,D. HLL is IndiaJs largest (ast Moving )onsumer *oods company, touching the lives of two out of three Indians. HLL's mission is to add vitality to life through its presence in over +, distinct categories in Home - .ersonal )are .roducts and (oods - "everages. #he company meets everyday needs for nutrition, hygiene, and personal care, with $rands that help people feel good, look good and get more out of life. H!! TRANSFERS TEA ESTATES INDIA TO MA87E!! GO!DEN TEA ,RI"ATE !IMITED Mumbai, March !, "#: Hindustan Lever Limited %HLL& has transferred its entire shareholding in its 1,,K su$sidiary #ea 6states India Limited %#6IL& to Mawell *olden #ea .rivate Limited %M*#&, a Aood$riar *roup company on March 1, +,,?. #6IL owns B tea estates and ? factories for processing tea in the high8yielding $elt of #amilnadu with an average annual output of appro. 1,,D,, metric tons. Aood$riar *roup has interests in plantations, insurance services and real estate. #he *roup's gardens are spread across the premium tea growing regions in #amilnadu and Cerala. HLL management $elieves that the proposed transfer to Aood$riar *roup is in the $est interest of the tea plantation $usiness and all its stakeholders. 6isting terms and conditions of services of all #6IL employees will $e fully protected in accordance with applica$le laws and terms of their employment. #he ac5uisition of #6IL $y Aood$riar *roup will provide scale and $ring in synergy $enefits to Aood$riar *roup, as a large portion of #6IL gardens are contiguous to the eisting tea gardens of Aood$riar *roup. )anara "ank, Madurai )ircle has funded the de$t component to Aood$riar *roup for this ac5uisition. Aith this disposal of shareholding in #6IL, HLL has completed its eit from its tea plantations $usiness $oth in 4outh India and Assam. It may $e recalled that HLL had sold its interests in 0ossell Industries Limited and Doom Dooma #ea )ompany Limited in Assam during the last 1+ months. D4. Merrill Lynch Limited acted as financial advisor to Hindustan Lever Limited. A$o)t H!!B HLL is IndiaJs largest (ast Moving )onsumer *oods )ompany, touching the lives of two out of three Indians. HLLJs mission is to Iadd vitality to lifeI through its presence in over +, distinct categories in Home - .ersonal )are .roducts and (oods - "everages. #he company meets everyday needs for nutrition, hygiene, and personal care, with $rands that help people feel good, look good and get more out of life. (or more information visit www.hll.com Media Co%tactsB .aresh )haudhry 8 ,++ ;@B;+/FB or paresh.chaudhrySunilever.com 0 0ammohan 8 ,++ ;@B;+/1; or r.ramSunilever.com MARICO TO ACEIRE NIHAR FROM H!! M)2$ai3 -a%)ar0 :@3 :AA?B Marico Ltd. %Marico& has reached an agreement to ac5uire the $rand 7ihar from Hindustan Lever Limited %HLL&. 7ihar has a current annuali3ed turnover of a$out 0s 1+, crore spread over two segments8 coconut oil and perfumed hair oils. Marico and HLL announced this in a joint media release today. HLL had initiated the divestment as a part of its $rand rationali3ation eercise. #he process involved competitive $idding amongst select (M)* )ompanies. #he transaction envisages a transfer of the I.0 and other rights associated with the $rand in India and other parts of the world. HLL will continue to operate $rands other than 7ihar in the value added hair oil segment. Marico epects to reap significant synergies from 7ihar> 7iharJs strengths in the 6ast 8 especially its distri$ution reach, in "ihar and 9harkhand8 will provide Marico a platform for its other $rands. !n the whole, MaricoJs $rands will gain in the 6ast. In .erfumed )oconut !ils, 7ihar 7aturals %9asmine and 0ose& is the national market leader, with significant presence in the 6ast. In )oconut !il, 7iharJs regional strengths will complement MaricoJs presence in this 0s B,, crore category. MaricoJs efficient supply chain, larger scale of operations and high focus on coconut oils and hair oils will also ena$le Marico to drive cost advantages. Mr. Harsh Mariwala, )hairman and Managing Director, epressed happiness at MaricoJs first ac5uisition over 0s. 1,, crore. I7ihar elegantly complements MaricoJs strengths in $oth )oconut !il and .erfumed Hair !ils. Ae see significant scope for value creation leveraging 7iharJs e5uity. #his will help us top up our healthy organic growth, as we move towards our target of reaching a 0s. +,,, crore turnover over the net ; years.I Mr. M C 4harma, :ice8)hairman, HLL stated> I#his is in line with our .ortfolio rationali3ation strategy, while at the same time creating value for our shareholders.I Am$it )orporate (inance acted as Marico's advisors in this transaction. COM,ETITORS The ,rocter D Ga2$1e Co2pa%0 Co2pa%0 ,rofi1e #he .rocter - *am$le )ompany %.-*& is a $rand $ehemoth. #he worldJs T1 maker of household products courts market share and $illion8dollar $rands. .-*Js products fall into three categories> glo$al $eauty care2 glo$al health, $a$y, and family care2 and glo$al household care. It also makes pet food and water filters and produces soap operas %As the Aorld #urns&. More than +, of .-*Js $rands are $illion8dollar sellers %including Actonel, AlwaysHAhisper, "ounty, )harmin, )rest, DownyHLenor, (olgers, Iams, !lay, .ampers, .antene, .ringles, #ide, and Aella&. Ac5uisitive .-* $ought )lairol in +,,1 and a majority of Aella in +,,;. Its purchase of *illette in late +,,D was its $iggest $uy in company history. Fi%a%cia1 Hi.h1i.hts (iscal <ear 6nd> 9une 0evenue %+,,D&> D?F/1.,, M 0evenue *rowth %1 yr&> 1,./,K 6mployees %+,,D&> 11,,,,, 6mployee *rowth %1 yr&> ,.,,K DATA ANA!YSIS FMCG MARKETS 4lowdown in growth - then + years of decline FMCG MARKETS +,,/ 8 0evival after + years of decline FMCG Mar'et IH!! Cate.ories) Gro&thJ -1.1 -2. -2.! ".! 2." #.1 -$ -2 " 2 $ # ! "2 "% &1 '"$&2 '"$&% '"$&$ '"$ IN"ESTMENTS /EHIND /RANDS STE, , IN H,C AD, S,ENDS CRRENT ,ERFORMANCE H,C( GRO7TH "o1)2e Gro&thJ Sa1es Gro&thJ C)rre%t ,erfor2a%ce
(a$ric 7ash Actions taken.rice reduction Additional investment in 5uality Higher A - . spends "rand repositioning Actio%s ta'e% .rice reduction Additional investment in 5uality Higher A - . spends "rand repositioning :AA? ( Fi%a%cia1 Hi.h1i.hts P Co%ti%)i%. sa1es f1at K H,C LH.) grows ?K in :olumes2 growth across categories L.ricing actions lead to +K value growth L:alue growth momentum picking up L:olume market shares gains in Laundry and 4hampoo KFoods L4trong growth in "rooke"ond, Lipton and Instant )offee LDecline $y FK impacted largely due to planned discontinuation2 stock reduction and one8 offs POperati%. ,rofits I,/ITL dec1i%es :CJ KCo2petiti*e strate.0 i% !a)%dr0 D Hair KAdditio%a1 AD, spe%ds i% H,C KHi.her foods 1osses
CONC!SION #he Indian (M)* market currently appears to $e at a crossroads, and HLL are attempting to change customer perceptions of their $rands and where specific $uying motivations appear to $e replacing generalities. #his meanwhile, is 5uite unlike the west where $uyers consider aesthetics, comfort and safety, not necessarily in that order, $efore finalising a purchase. NIt's smarter to think a$out emotions and attitudes, if marketers are to do a $etter jo$ of marrying what a HLL offers to the consumer's image of the offerings. Another important outcome of the research is the $elieva$ility of the claims. Most of the claims are realistic and easy to understand. Most of the people don't understand the 5uality claims $y HLL. #he mindset of the Indian consumer is such that he is delighted if he $uys a pen a little cheaper than his neigh$our. #hings are, however, slowly changing and customers at the upper end of the market are now ready to pay more for more. I hope that this approach will soon enter the new era, may$e not with the same intensity . N4uccess will largely $e determined to the etent a company can differentiate itself in terms of intangi$les that go with a .roductO. #hus, success could well hinge on the $est of $undle of services that HLL provides.HLL grew from 3ero to the +,+?B Million M, mark and the num$er !ne (M)* company in India this year. Looking at the present scenario it can $e said that though there is lot of competition in the market $ut HLL is picking up well. #he landmark achievement comes in F/ years in India after clinching its first overseas sale. SGGESTIONS Ke0 Attri$)te co2po%e%tsB :alue for money and )ustomer )are !perational attri$utes. .hysical attri$utes. "rand Image. )ustomer 4pecific Details. In any correspondence with the customers the message should $e sent in these components only to have the maimum $enefit from the advertisement. Also these components should $e dealt with independently. #he advertisements should speak only of the $elieva$le concepts rather than glorifying the pretentious ones. #he $asic need of the customer need to $e addressed which is actually not much epensive and $etter 5uality. HLL sales growth in june +,,/ was decreased due to the pro$lem with promotion and pricing. Although $eing the most competitive product on the $asis of the Market !perating .rice %M!.&, the shampoos are still not selling much. #his is perhaps due to the $argaining stress on the customer and the weak push given $y the dealer to the particular item, when actually it should $e sold like a high volume product. Another serious suggestion is that HLL must give good attention to their all the products rice and all are not getting much attention. #he dealers don't provide much support to the customers in making them understand the real Guality $ehind them. 6ither, the technical details should $e presented in a clearer manner or the dealers need to $e educated properly. !IMITATIONS 6verything in this world has its own advantages and disadvantages which shows Qnothing is perfect'. (ollowing are the pro$lems faced $ut it's a part of game> 1. #IM6 )!74=MI7*> It is very much o$vious that it is a time consuming process. 4o much time has $een spent for this purpose. +. L!A .A0#I)I.A#I!7> !$viously many respondents have not participated in this and have also created some pro$lems which simply shows that they were not interested. ;. "IA47644> 4ometimes interested customers were also $iased so the collected figures involve $oth positive and negative figures. /. It does not cover all the aspects of the company. D. 4="96)#I:6> #his project only tells you what it is all a$out.
A,,ENDI8 C)sto2er S)r*e0 E)estio%%aire 7ame Age Address G1. How many mem$ers are there in your familyR G+. Have you ever heard of HLL %Hindustan Lever Limited&R <64 UUUUUU 7! UUUUUU
If <es, from whereR
7ewspaper Maga3ines #elevision !thers UUUUUUUUU
G;. Are you using any HLL productR <64 7! G/. If <es, then are you satisfiedR <64 7! GD. If 7o, then reason $eing .oor 5uality High prices 7o services !thers G?. Ahich $rand do you use in the following categories > .ersonal Aash Lu UUUUUUUUUU "ree3e UUUUUUUUUUU Dove UUUUUUUUUU !thers UUUUUUUUUUU Laundary