Bajaj Corp

Bajaj corp

Company Overview

Bajaj Corp Ltd is an Indian consumer goods company with major brands in Hair care category. Bajaj Corp is the second largest company in the Shishir Bajaj Group of companies. Bajaj Corp Ltd is the 2nd largest player in the overall hair oils segment with the Key brand - Bajaj Almond Drops Hair Oil. Its flagship brand, i.e. Almond Drops, is the Market leader with over 62% market share of the light hair oil market with Premium positioning and commands one of the highest per unit price in the industry. In 2013, it entered the skin care market by acquiring the nomarks brand which has also shown steady growth in recent years.

Bajaj Corp Shareholding Pattern
Bajaj Corp Organisation structure
Bajaj Corp Milestones

Business Overview

Bajaj Corp is mainly in the business of hair oil with around 97% of the total revenue coming from this segment. Within the hair oil segments it has five major brands Bajaj Almond Drops Hair Oil, Bajaj Amla Hair Oil, Bajaj Brahmi Amla Hair Oil, Bajaj Kailash Parbat Hair Oil, Bajaj Jasmine Hair Oil. Its Key brand – Bajaj Almond Drops Hair Oil, is the 2nd largest brand in the overall hair oils segment and is the market leader with 60.7% market share in terms of value in the LHO market (YTD Feb 17). It has premium positioning and commands one of the highest per unit prices in the industry. Manufacturing plants are located at Himachal Pradesh and Uttaranchal.

Geographical Reach

Bajaj Corp Geographical reach

They also have significant international presence as their personal care brands are available in more than 30 countries, with primary focus in SAARC, Gulf & Middle-East, ASEAN and African regions

There major source of revenue is from the hair oil segment which has the the revenue contribution of around 97%.
In 2013, it ventured in the skin care market by acquiring the Nomarks brand. It has shown steady growth in the recent years and acquired a market share of 6.9% in 2015-16. The brand includes various cosmetic products such as face wash, scrub, soap etc. The Bajaj Nomarks Cream is the market leader in the Anti Marks segment (as of March 2016, market share by volume).

Bajaj Corp Sales Mix by Value
Bajaj Corp Sales Mix 2

No Marks Acquisition


No Marks was acquired by Bajaj Corp in 2013. It is a skin care brand which Includes various cosmetic products such as face wash, scrub, soap etc. Since it’s acquisition it has shown steady growth acquiring a market share of 6.9%. It is the market leader in the cream segment with a market share of 15.5% and has No.2 position in the Face wash segment with a market share of 6.5%

They plan to use a communication strategy for Nomarks. The focus would be to use a chemist panel for distributing Nomarks Cream and using an integrated marketing campaign to improve consumer awareness and preference for the brand. They will be extending this strategy both in terms of communication and distribution in more states. On back of this and improved reach in international markets, they expect a reversal of sales trends on Nomarks in the first half of FY 18. They will majorly focus on the urban areas for the Nomarks cream.


Industry Structure

Bajaj Corp Industry Structure
Bajaj Corp Market Break up
Hair oil Market Volume

Product portfolio

Hair Care

Bajaj Corp Product portfolio

A premium perfumed hair oil containing almond oil and Vitamin E. It is the leading hair oil in the light hair oil segment with the market share of around 62%. This premium hair oil, enriched with sweet almond oil nourishes the scalp and keeps hair healthy and beautiful. It accounts for around 93% of their total revenue by value

Bajaj Corp market Share
Bajaj Amla Hair oil

Launched in February 2015, Bajaj Amla Hair Oil is a non-sticky hair oil. It is enriched with the goodness of Amla extract, Almond oil and Rosemary oil. These Ingredients of the oil are known to strengthen the hair, maintain natural hair colour and impart shine to the hair.

Kailash parbat


It is enriched with the goodness of Sandalwood oil, Almond oil and Ayurvedic Herbs. It provides a calm and relaxing effect thereby refreshes from stress, fatigue and tiredness.

Bajaj Brahmi Amla

It is one of the oldest Amla hair oil brands in India. It nourishes and conditions the hair making it both soft and strong.

Nomarks.jpg

 

Bajaj Corp acquired the skin care brand in 2013. It Includes various cosmetic products such as face wash, scrub, soap etc. Since it’s acquisition it has shown steady growth acquiring a market share of 6.9%. It is the market leader in the cream segment with a market share of 15.5% and has No.2 position in the Face wash segment with a market share of 6.5%


Impact of Demonetization
Demonetization had a serious impact on the company, majorly in the third quarter. Overall turnover declined due to destocking. General trade and canteen stores were the worst affected. canteen store orders went down by 13.5%. Wholesale trade was also severely affected. Showed a decline of 30%. Wholesale coverage down by 1 lakh outlets. Modern Trade were majorly unaffected and showed a healthy growth of 27% in Q3. Urban offtakes recovered much faster than rural offtake. There was no effect on raw material price due to demonetization but production reduced and so raw material procurement came down

Key Focus Areas for Growth

Market share gains from other hair oil segments: Convert coconut hair oil users to light hair oil users through sampling, targeted advertising campaigns, product innovation and creating awareness about product differentiation including communicating the advantages of switching to lighter hair oils. Aim for a market share of 65% by the
year 2017-18

Focus on rural penetration: Tap the increase in disposable income of rural India and convert rural consumer from unbranded to branded products by providing them with an appropriate value proposition

Leverage existing strengths to introduce new products: The company has over the years created a strong distribution network across 3.6 mn. retail outlets which can be optimally utilized by introducing new products. Company intends to extend ‘Almond Drops’ platform developed by its Almond Drops Hair Oil brand to other personal care products to leverage on the strong connotation of Almonds with nutrition

Pursue inorganic Opportunities: Will seek inorganic growth opportunities in the FMCG and hair oil market as part of growth strategy, The inorganic growth opportunities will focus on targeting niche brands which can benefit from BCL’s strong distribution network so that they can be made pan India brands


Competitive advantage
Brand name- Bajaj Corp has created a great brand name, mainly for its hair care products. It is the market leader in most of the segments and is also able to charge a premium for it products. Its ability to charge a premium for its product can be huge advantage in the future due to the burgeoning middle class population of India.
 
Market Leader- Bajaj Corp is the market leader in the light hair oil Category with around 58% of the market share in terms of volume and 60.7% in terms of volume. This helps the company to dictate terms in the industry

Bajaj Corp Volume

Differentiated revenue lines- It has multiple category of products in the hair care segment, targeting various needs and price points. With its venture into skincare products it has further widened its scope.


International Exposure: Bajaj Corp Ltd. is constantly increasing its global footprints with focus on international business. Currently, they have presence in more than 30 countries. This geographical diversification could also work a huge advantage for the company in the long run.

Key Financials

Profit and Loss

Bajaj Corp Profit and Loss Statement

Balance Sheet

Bajaj Corp Balance sheet

Cash Flow

Bajaj Corp Cash flow

Ratio Analysis

Bajaj Corp Ratio Analysis

Bajaj Corp in Six Charts

Bajaj Corp Price movement charts