The Indian operations of cosmetics firm The Body Shop will remain unaffected by the restructuring in the UK, as affirmed by the company’s partner Quest Retail Pvt Ltd. Last week, the UK arm of the cosmetics company, grappling with financial crisis, entered administration, with experts from FRP Advisory appointed to oversee the process.
“This administration process does not impact The Body Shop India as it is a head franchise market. All our stores are open as usual,” Quest Retail Group CEO Shriti Malhotra said in a statement.
She mentioned that all stores in India are operating under normal hours, with customers able to shop both in-store and online. Furthermore, she highlighted that The Body Shop boasts nearly 200 stores across the nation, extending its reach to over 1,500 cities through its online platform.
“India is one of the top markets for The Body Shop globally, and our consistent growth reflects the popularity of The Body Shop and the immense opportunities we are tapping into,” Malhotra said.
Further, she said The Body Shop India will continue to scale up and focus on omni-channel expansion while leveraging newer opportunities in retail, quick commerce and high convenience formats so that the strong brand affinity built in India is well supported by easy and expansive access to customers.
The Body Shop India was launched in 2006 and is under the umbrella of Quest Retail Pvt Ltd, a beauty specialty company for marketing, retailing and distribution of global brands in India.
Last week, the Directors of The Body Shop International Ltd appointed Tony Wright, Geoff Rowley, and Alastair Massey of business advisory firm FRP as Joint Administrators of the company, which operates The Body Shop’s UK business.
Jubilant FoodWorks is looking to ramp up its focus on Domino’s value offerings as the QSR sector experiences sluggishness in the dine-in segment. As the leading food services company that introduced Popeyes to the National Capital Region, it expects the brand to emerge as the fastest QSR chain to cross the INR 1,000 crore-mark in the next 4-5 years.
Sameer Khetarpal, CEO & MD, Jubilant FoodWorks Ltd, said, “I think it is a time where we need to pass more value to consumers. In high-inflation environment, consumer tighten their purse strings and conserve cash. For Domino’s delivery is growing faster than we expected and delivery is positive in terms of like-for-like. We are bringing in some better value propositions for our dine-in customers.”
He further stated that the emphasis will be on introducing “more value-conscious meals and combos” for Domino’s dine-in patrons in the current quarter.
This comes at a time when delivery sales growth have been outpacing dine-in sales for the QSR sector.
“India has the cheapest price per delivery and so it is very economical to order at home. With rapid urbanisation and people having less time, it is convenient to order food at home. With the emergence of the aggregators, delivery has been more democratised. Therefore one is seeing compression in dine-in, which is consistent with trends being seen globally,” Khetarpal explained. He added whenever there are festival occasions consumers do come out and loosen their purse strings but otherwise they have been focusing on conserving cash.
The company inaugurated its 33rd Popeyes store on Wednesday. We want to get to about 250 Popeyes stores in the next 4-5 years. We want it to be the fastest QSR to get to INR 1,000 crore in India in that timeframe,” Khetarpal added.
The company plans to add four more stores in the Delhi-NCR region.
Responding to a query on inflationary pressures, he said, “Inflation has been on a decadal high especially for the ingredients that we buy for Domino’s. But we do see softening in inflation as government has taken measures to keep it benign.”
He further mentioned that the company’s gross margins have grown year-on-year due to several cost-saving measures.
ITC is currently evaluating the acquisition of a 47% stake previously held by Peak XV Partners (formerly Sequoia Capital) in the publicly traded Prataap Snacks, as reported by ET. This comes after unsuccessful talks with Haldiram’s due to a valuation mismatch. Prataap Snacks, renowned for its Yellow Diamond chips and traditional Indian namkeen under the Avadh brand, has piqued the interest of ITC. Additionally, negotiations with listed Bikaji Foods, another major player in the snacks industry, also failed to materialize, according to sources familiar with the matter.
Other buyout funds such as KKR, TA Associates, and Apax have been engaged following Peak XV’s decision to fully divest its nearly 13-year-old investment in Prataap. Peak XV enlisted Deutsche Bank to manage the sale of the company.
If the transaction succeeds, it will trigger an open offer for an additional 26% of the Indore-based company. Since its stock market debut in 2017, during which it listed at a 33% premium, the company has been underperforming. Prataap closed 1% lower at INR 1,174.45, with a market value of INR 2,802.19 crore on Wednesday.
ITC, renowned for its sale of Bingo chips and namkeen alongside other products, finds Prataap offering substantial leverage in specific regional markets. This is particularly evident where ITC’s own brands struggle to gain traction against formidable local competitors.
An ITC spokesperson said, “We do not comment on market speculation.”
Amit Kumar, the managing director of Prataap Snacks, did not provide any responses to inquiries, nor did TA Associates. KKR opted not to comment.
An email query sent to Peak XV remained unanswered.
As per the FY23 annual report, Prataap Snacks operates a total of 15 manufacturing facilities, with seven being owned by the company itself and eight operated by contract manufacturers.
According to a report from market research firm IMARC Group, the Indian snacks market was estimated at INR 42,694.9 crore last year, with projections indicating it will more than double to INR 95,521.8 crore by 2032. Despite this rapid growth, the snacking industry remains fragmented and fiercely competitive.
Among the national players are PepsiCo, renowned for marketing Lay’s, Doritos, and Kurkure, alongside ITC, Haldiram’s, Bikaji Foods, Balaji Wafers, Too Yum, and the recent entrant Reliance Consumer Products, which has collaborated with General Mills to distribute Alan’s Bugles snacks.
Private equity funds, on the other hand, are reportedly showing tepid interest due to the company’s lack of growth in the premium segment.
“It operates in the INR 5 segment where the margins are wafer thin. Unless you hit the sweet spot, INR 10 per packet and above, there is not much juice left for a fund to buy a listed company and transform it,” said a PE executive who has been approached. “It’s losing market share and distribution too and it’s an unhealthy category for a PE to bite into.”
In the quarter ended December 2023, Prataap Snacks reported standalone net sales of INR 408.31 crore, up 8% from INR 377.79 crore in the year-ago quarter. The snack maker’s quarterly net profit more than trebled to INR 10.79 crore from INR 3.42 crore. It clocked sales of INR 1,652.93 crore in FY23 and net profit of INR 20.26 crore.
Executives citing NielsenIQ data stated that ITC Foods overtook Britannia, Parle Products, and Britannia to become the country’s largest foods maker in the nine months to September 2023. It clocked food FMCG sales of Rs 17,100 crore in the duration, ahead of Britannia, Adani Wilmar, Parle Products, and Mondelez.
ITC’s portfolio of foods and staples encompasses popular brands such as Yippee noodles, Sunfeast biscuits, Bingo chips, Aashirvaad atta, and MasterChef frozen foods. Similar to Tata Consumer, ITC has also been exploring acquisitions, having acquired Yoga Bar last year.
Chairman Sanjiv Puri’s ITC Next strategy emphasizes a portfolio of products tailored to meet evolving consumer demands. According to insiders, while Yoga Bar represented one aspect of this strategy, ITC is poised to leverage its robust distribution network to promote Prataap’s brand portfolio.
On Wednesday, Oyo announced the introduction of Wizard Shark, a novel ‘limited-edition’ loyalty program. This initiative comes on the heels of its founder and group CEO, Ritesh Agarwal‘s appearance on the reality series Shark Tank India.
Priced at INR 1, the program offers various benefits such as assured discounts, upgrades, and rewards, the company highlighted.
Customers can avail a free night’s stay after seven room nights, along with an additional 5% discount on Oyo’s network of over 3,800 Wizard hotels in India, as well as other rewards in the form of Oyo money under Wizard Shark. Valid for three months, the programme offers free membership renewal.
Originally introduced in August 2018, Oyo’s Wizard program, with more than 4.4 million active members, is touted by the company as one of the largest loyalty programs in the Indian hospitality industry.
“Customer-centricity has always been at the heart of Oyo’s endeavours. Our Wizard programme has emerged as a major pull for customers, and Wizard Shark, with its attractive pricing and wide range of benefits, will hopefully prove to be equally appealing to our loyal customers,” said Ritesh Agarwal.
“Designed especially for business travellers, Wizard Shark is a smarter, more efficient way to book your stays at the best prices. We take great pride in a majority of our guests being repeat customers and Wizard Shark is yet another initiative to offer them the best-in-class experience,” he added.
Agarwal made his debut on Shark Tank India for its third season, earning the distinction of being the youngest-ever judge on the show.
Apart from Wizard Shark, the program extends to three other tiers: Blue, Silver, and Gold. Gold members earn one complimentary stay annually after staying for five nights at Oyo. Meanwhile, Wizard Blue and Silver customers can redeem a reward stay after their eighth and seventh nights, respectively.
Gold members also enjoy the perk of unlimited ‘Pay at Hotel’ bookings, eliminating the need for prepayment. Additionally, they receive exclusive benefits such as priority customer support.
Wizard Blue membership is priced at INR 99, while Silver and Gold memberships are available for INR 199 and INR 399, respectively.
Mumbai-based luxury beauty brand Baccarose has expanded its fragrance portfolio by introducing Alexandre.J, a prestigious French luxury perfume brand, to the Indian market.
“We are thrilled to launch Alexandre.J Perfumes in India, offering a perfect blend of artistry and accessibility in niche perfumery. This collaboration resonates with the increasing demand for luxury fragrances in India,” said Kadambari Lakhani, director, Baccarose Perfumes & Beauty Products Pvt. Ltd.
As part of this collaboration, Baccarose will present Alexandre.J’s unique collections, including The Collector, Art Deco, and Art Nouveau, to consumers in India.
“Entering the vibrant and diverse Indian market is an exhilarating moment for Alexandre.J. Our partnership with Baccarose showcases our unwavering dedication to delivering an unparalleled olfactory experience to the Indian consumer,” said Amelie Jabban, visionary Global Brand Director of Alexandre.J.
Launched in France in 2012, Alexandre.J boasts a 100% made-in-France production. Perfumes are meticulously crafted in Honfleur, Normandy, while oil fabrication occurs in Grasse. With a footprint in more than 85 countries, the brand’s reach is extensive.
Founded in 1984 by Hemansu Kotecha, Baccarose asserts its position as a premier distributor of international luxury beauty brands in India. As per the company’s website, it manages a multi-tier distribution network spanning 16 warehouses across the country. Collaborating with prominent retailers such as Sephora, Nykaa, Shopper Stop, and Lifestyle, Baccarose maintains a significant presence in the market.
Baccarose oversees over 5,000 points of sale and handles a portfolio of over 65 brands on prominent e-commerce platforms.
On Thursday, Prime Minister Narendra Modi will participate in the golden jubilee festivities of the Gujarat Cooperative Milk Marketing Federation (GCMMF), renowned for its ‘Amul‘ brand. As per an official statement by a representative of the dairy giant, the Prime Minister will also unveil five projects amounting to INR 1,200 crore. Jayen Mehta, the managing director of GCMMF, mentioned that the federation will deliberate on its vision for the forthcoming 25 years during the event.
More than 1.25 lakh dairy farmers, including representatives from approximately 18,600 villages in Gujarat, are expected to attend the event at the Narendra Modi Stadium in the Motera area of Ahmedabad. Mehta mentioned that 40-45 percent of the dairy farmers in attendance will be women.
Mehta said that the federation was established in 1973, with an annual turnover of INR 20 crore.
“In the last 50 years, it has emerged as the country’s number one FMCG (fast-moving consumer goods) organisation, with the Amul brand set to achieve a turnover of INR 80,000 crore, and Amul Federation a turnover of INR 61,000 crore this financial year,” he said.
Apart from PM Modi, Union Home and Cooperation Minister Amit Shah, Union Animal Husbandry Minister Parshottam Rupala and Chief Minister Bhupendra Patel will also remain present during the golden jubilee celebrations, he said.
During his visit, Modi will inaugurate five new dairy projects, including a modern cheese plant of Sabar Dairy, which has come up with an investment of INR 600 crore, a long-life tetra pak milk plant of Amul Dairy at Anand and the expansion of its chocolate plant, he said.
The PM will also inaugurate a 50,000-litre ice cream plant of Sarhad Dairy in Kutch, a unit of Bharuch Dairy coming up in Mumbai, along with various dairy development works under government schemes in the state’s Saurashtra-Kutch region.
“The total investment of the projects is INR 1,000-1,200 crore. On February 23, during his Varanasi visit, Modi will inaugurate a plant of Banas Dairy which has come up there with an investment of INR 600-700 crore,” he said.
Amul’s vision for the next 25 years will also be discussed on Thursday, he said.
Even as each of GCMMF’s 18 milk cooperative members takes the initiative to raise its milk handling capacity, they are expanding by setting up new plants in the state and other parts of the country, Mehta said.
Amul plans to invest INR 11,500 crore in the next 2-2.5 years as part of the MoUs (memorandums of undertaking) signed at the World Food India event organised in New Delhi in November last year, Mehta said.
“At the event, organisations from different countries made investments of INR 33,000 crore, out of which MoUs for investment of INR 11,500 crore were signed by Amul alone. We will make investments in the dairy processing and collection system as well as setting up ultra modern processing plants, among others,” Mehta said.
He said the investments will largely be made in Gujarat. Member cooperatives will also invest in Varanasi, Rohtak, Ujjain, Mumbai, Goa, Pune, and Kolkata, he added.
QSR chain operator Jubilant Foods Ltd (JFL) expects its fried chicken brand Popeyes to reach INR 1,000 crore in sales within the next 3-4 years, as mentioned by its CEO and MD Sameer Khetarpal on Wednesday. Additionally, JFL, which is also a master franchisor of Domino’s, is expanding its reach and is expected to have around 3,000 outlets in the medium term.
The company plans to “swiftly broaden its presence” across its QSR brands, placing particular emphasis on Domino’s, given India’s status as a “rapidly expanding market” characterized by increasing discretionary income and urbanization spurred by its growing economy.
When asked about its latest addition Popeyes, Khetarpal said, “We have got an outstanding response from Popeyes as a brand here.”
JFL, which opened its first store in Delhi on Wednesday and its 33rd store pan-India, has plans to add four more stores in the national capital region next week.
“We are rapidly expanding and Popeyes will be the fastest QSR chain to get INR 1,000 crore in sales,” Khetarpal said.
He further stated that on average, a QSR chain typically requires 11-15 years to achieve such a scale.
“We are opening stores very rapidly. We will do 30 to 50 stores this financial year they’re already there,” Khetarpal said, adding that the company will continue to expand rapidly next year as well.
On the timeframe for Popeyes reaching INR 1,000 crore in sales, Khetarpal said, “It will take 3 to 4 years. By FY28, it would absolutely reach there.”
JFL plans to expand Popeyes’ presence to the National Capital Region (NCR) and other prominent cities in North India.
Launched by JFL in January 2022, the brand is presently operational in 10 cities across South India, with Delhi marking the eleventh city.
For the current fiscal year, the company has plans to invest similarly around INR 750 crore on expansion and opening of new stores, he added.
JFL is also in the process of expanding its food factories. Presently, there are two factories in operation: the first located in Noida and the second recently inaugurated in Bangalore. Additionally, work is underway for the establishment of a third factory.
The recently commissioned Jubilant Food Park Bangalore is the largest food processing unit. This facility is designed to serve 750-plus Domino’s stores, and 300 stores of Popeyes, Hong’s Kitchen, and Dunkin’, according to the company.
About the expansion of Domino’s, the largest brand in its kitty, Khetarpal said it is expanding rapidly both in metro and smaller towns and gaining market shares from the competitors.
“When we started…Domino’s 27 years ago, we would have not imagined we would get to 2,000 stores. Our medium-term outlook remains 3,000 outlets in the next 4 years,” he said.
The potential is far greater than 3,000 stores, with over 1,000 colleges having more than 5,000 students, yet Domino’s is not present.
“There are so many metro stations and airports that are being built, where we are not present. Opportunities are for beyond 3,000 outlets, but our medium-term outlook is to open 250 stores every year…” Khetarpal added.
Besides Domino’s, JFL which is part of the Jubilant Bhartia Group, also has franchise rights to Dunkin’ and Hong’s Kitchen!
“Expansion is on the way for all the brands,” he added.
The expansion would be through company-owned stores but it is also trying for a franchise model, Khetarpal said.
As of December 30, 2023, JFL was operating 1,928 Domino’s stores, 25 stores of Dunkin’ and 22 stores of Hong’s Kitchen.
BigBasket, the Tata Group-owned online retailer, has revamped and rebranded its slotted delivery business, which contributes the largest chunk to its overall revenues. It has decided to rebrand it as “bigbasket supersaver“ with a sharper focus on faster deliveries made within two hours.
“This is not just a rebranding, but we have also made the slotted delivery business faster and more efficient. It contributes significantly to the overall business. It already has a strong customer base, who are essentially buying large orders of groceries, which were being typically delivered on the same or the next day. We have done re-engineering of our systems and processes to be able to offer extensive assortment of groceries at the same kind of value pricing within two hours,” said Hari Menon, Co-Founder and CEO, bigbasket.
He further mentioned that over the next three to six months, the primary emphasis will be on achieving even faster product deliveries within a one-hour timeframe.
Apart from its slotted delivery service, India’s earliest grocery delivery company is renowned for its instant grocery service, bbnow, and its subscription-based service, bbdaily. The slotted delivery business contributes to around 60-65 percent of the e-grocery player’s revenue.
The bigbasket supersaver program has already rolled out in more than 40 of the 70-odd cities where the platform operates and will expand to encompass all these cities by mid-March. Additionally, it will provide an extra 5 percent savings on various products. Customers will still have the choice to select their preferred delivery slot.
“With the launch of the new model, we expect to see quarter-on-quarter growth of about 35 per cent for this business,” he added.
Menon stated that the range of products available via the slotted delivery service is three to four times broader and more economical compared to those offered through its quick commerce delivery services.
Earlier, the assortment of products was stored in dark stores and warehouses. Elaborating on the re-engineering of processes, he added, “We now carry the entire range of 25,000-30,000 products in dark stores. We are also delivering all the orders through bikes and are doing away with van-based deliveries. We have tested the new model for consistently being able to deliver within two hours, while maintaining the average order value, which is a critical piece. It has tested well for all these parameters. We have also ensured we maintain the value pricing.”
The average order value for the slotted delivery business is estimated to be around INR 1,250-1,300, whereas for quick commerce, it typically ranges between INR 400-500.
On February 21, Devyani International Ltd, the largest domestic franchisee for Yum Brands (including KFC & Pizza Hut) and the sole franchisee for Costa Coffee, saw its shares surge by 6%. This uptick came as 5.3 crore shares, representing a 4.4 percent stake in the quick service restaurant operator, changed hands in a block deal.
The stake was divested at a floor price of INR 164 each, representing a slight discount of 1.2 percent compared to the previous closing price.
Although the buyers and sellers couldn’t be confirmed, a CNBC-TV18 report suggests that Yum Restaurant India Private Ltd is likely divesting its entire 4.4 percent stake in the KFC operator. Citigroup Global Markets India is the sole book-running lead manager in this transaction.
The report came at a time when the QSR industry is experiencing weak unit economics, across both dine-in and delivery formats. Despite these industry-wide difficulties, KFC has shown resilience in managing the crisis effectively, as noted by Motilal Oswal Securities in a recent statement.
“On the other hand, PH has been struggling, partly attributed to intense competition in the market. Store expansion plans remain buoyant for Devyani despite near-term industry challenges. The overall guidance of reaching 2,000 stores by FY24 remains on track. We maintain a cautious stance due to the ongoing demand challenges in the near term. The recent correction in the stock partially covers up the near-term pressure,” it said. We reiterate our BUY rating on the stock with a target of INR 195,” it said.
The Yum stake sale is reportedly valued at INR 814.80 crore, with Citigroup Global Markets India presumed to be the sole book-running lead manager (BRLM).
According to a recent report by Elara Securities, Devyani International was actively focused on improving its delivery performance and strengthening ties between its stores and delivery services. The company aimed to broaden the presence of Pizza Hut and KFC outlets with a specific emphasis on delivery. This strategy involved extensive collaboration with delivery aggregators to capitalize on the rapidly expanding online delivery segment.
“In case of Pizza Hut India, it has shifted focus toward a delivery-centric model while maintaining strategically located dine-in and flagship stores. The accelerated expansion of delivery-focused stores has resulted in significantly improved delivery times, which, in turn, has enhanced overall consumer experience. This transition from large dining-oriented stores to smaller, delivery-focused formats has not only positively affected unit-level performance but also has facilitated a faster nationwide expansion,” it said.
Despite the rapid shift towards digital payments in India after Covid-19, a recent online consumer behavior survey conducted by the Indian Institute of Management-Ahmedabad (IIM-A) revealed that cash-on-delivery (CoD) remains the top choice for online purchases. The survey findings suggest that concerns about trust may be influencing consumers’ payment preferences.
“Nearly 65 per cent of consumers used cash to make payments in their last online transactions. In particular, consumers use cash more to buy fashion and clothing products exclusively. Cash is also the preferred payment mode for consumers from low-income groups having annual household income less than INR 3.6 lakh,” states the findings from a survey of 35,000 consumers conducted by IIM-A across 25 States.
The survey, titled ‘Digital Retail Channels and Consumers: The Indian Perspective’, utilizes consumers’ most recent online shopping transactions to evaluate their behaviors and perspectives regarding online shopping.
“While our survey did not ascertain the reasons why consumers prefer CoD, trust may be an issue. However, one needs to think about trust more broadly, say factors that create doubt across product categories. For example, consumers looking to buy fashion and clothing may be concerned about the size and fit of the clothing, and consumers buying electronic products may be wary about the product being a used product. However, more research is required to ascertain these facts, and our data may not speak much regarding whether these are leading to greater use of CoD,” said Pankaj Setia, IIMA Chair Professor, Professor of Information Systems.
Professor Setia collaborated with Professor Swanand Deodhar and Ujjwal Dadhich from the Centre for Digital Transformation of the institute to co-author the survey report.
When asked which cities in India reported greater use of CoD, Setia stated, “Compared to others we do see greater use of CoD in cities such as Kolkata, Patna, Agra, Amritsar, Bhiwandi, Arrah, Ranaghat, Phulia, Bokaro Steel City and Puruliya.”
According to the findings of the IIM-A survey, fashion, clothing, and electronic items emerged as the primary product categories for online purchases. Remarkably, 87 percent of consumers opted for cash-on-delivery (CoD) exclusively for purchasing fashion and clothing products, whereas 75 percent exclusively used CoD for buying electronic products.
“For Indian consumers, CoD is the most preferred payment method for online shopping. It provides consumers the convenience to pay when the correct order is received. Initially, CoD was started to encourage online shopping and gain the trust of consumers in E-commerce. With time, several payment methods, including digital payment systems, have evolved, but consumers still prefer CoD for online shopping,” states the survey where Flipkart was the principal partner of the retail tech consortium that funded it.
The consortium included Croma, Fabindia, Flipkart, Kotak Mahindra Bank, Nykaa, OYO, Patanjali, P&G, Snapdeal, StarQuik, and Unilever as additional partners.
“However, for retail channels, CoD is not as efficient as the logistic partners handle the transactions. In this process, the retail firms receive the payment a little later compared to other payment methods. For the CoD-based return, the process is even more complicated. At the time of initiating a return, consumers have to fill out the return form and share their bank details. Once the refund team validates the credentials and approves the refund status, the refund is transferred to the bank account. This entire process takes around 5 to 7 days to complete. As the turnaround time for CoD is longer, E-commerce firms usually promote other payment methods by giving discounts and cashback offers to consumers,” it added.
The survey findings also indicate that male consumers tended to spend more in online shopping transactions compared to women. “While this spending pattern needs further examination, it aligns with the gender gap in economic participation and opportunity in the country, wherein females lag behind males.”
The survey also indicated that a higher proportion of female consumers purchased fashion and clothing products, while a larger proportion of male consumers bought electronic products. Additionally, online consumers from smaller cities spent more than those in Tier 1 cities.
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