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Marico Ltd – Sowing Seeds For The Future

Marico Ltd – Sowing Seeds For The Future

Published on 13 March 2021 .Views 133 .Comments 5
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Hello. Hope you are doing well.

India’s doyen consumer goods company Marico is swinging for the fences like never before. In the last 9 months they’ve launched several new products, foraying into categories such as honey, ayurveda, plant protein and instant noodles. In today’s blog, we probe deeper to understand each of these segments and Marico’s growth strategy.

Post Covid-19, a distinct cardinal change in consumer behavior has been the adoption of healthier food choices which drive up immunity.

To echo the words of Saugata Gupta, MD & CEO - Marico Ltd, from Q3 FY21 Earnings Conference Call -

“One of the things that has happened in this pandemic is there is a significant realization that if you have lifestyle diseases or comorbidities, your propensity for things getting complicated is far higher. Therefore, the consciousness level will continue, and I see a potential in immunity or nutraceuticals category or healthy foods and trusted brands. This is something which is going to be permanent to a large extent.”

Hence, Marico is riding the healthy lifestyle wave by focusing more on their foods portfolio as it offers a relatively better business model and an opportunity to scale-up aggressively as compared to their personal care portfolio.

The company has witnessed robust growth along with consistently strong traction from customers in the foods portfolio (primarily oats and gourmet foods) in recent years. Hence, on the back of a staunch foundation they’ve extended their eminent health care brand Saffola to launch new products and diversify into novel categories like honey, ayurveda, plant protein and instant noodles.




June, 2020


September, 2020

Plant Protein (Soya)

December, 2020

Instant Noodles

February, 2021


According to Nielsen’s latest data - ‘Hygiene & Immunity Building’ categories recorded a value growth of 46% on a yearly basis and a 34% volume growth. Marico’s management believes these categories exhibit good potential to build a sustainable business over the medium term. They expect the health and immunity foods segment to generate a turnover of Rs. 350 crore in FY21 and clock Rs. 500 crore by the end of FY22, registering a 30%-40% growth.

Let’s get a glimpse into each of these categories –


1. Honey (Market Size ~Rs. 1,700 Crore)

Marico launched Saffola honey with 3 different variants in June 2020. The timing couldn’t have been better as the country was rife with the COVID-19 pandemic and the demand for health & immunity-building products was burgeoning. Within 3 months Saffola Honey amassed a market share of 8% in modern trade.

In December, a report Centre for Science and Environment (CSE) stated that several Indian honey brands such as Dabur, Patanjali, Apis and Zandu (Emami) were adulterated with sugar syrup as per the globally accepted NMR test. Saffola was one of the brands that cleared the test. This became a testament to Marico’s objective of furnishing superior quality 100% pure honey and consequently catapulted sales. At present it holds 20% market share in e-commerce.

Marico’s management has set a FY22 revenue target of honey at Rs.100 Crore. They are optimistic they’ll accumulate more market share as the category expands.

However, India's packaged honey market is dominated by Dabur which holds gigantic ~60% market share. Other established players like Patanjali, Emami and Apis are also fiercely vying for a bigger piece of market share.


 2. Ayurveda

When the pandemic was flourishing in the country, central government issued guidelines counseling citizens to consume immunity boosting foods like chyawanprash, giloy powder and turmeric milk. One can say it galvanized consumer interest and there was demand for ayurvedic products soared like an eagle.

In September 2020, Marico joined the venerable ayurvedic bandwagon by launching the Saffola ImmuniVeda range which consists of Kadha Mix and Golden Turmeric Milk Mix.  The following month they launched Saffola Arogyam Chyawan Amrut Awaleha an enhanced variant of the traditional chyawanprash.

By entering this category Marico is again locking horns with Dabur, the formidable global leader in market ayurvedic products. Dabur Chyawanprash is the largest selling ayurvedic medicine in the health tonics segment has over 65% market share. Gaining market share in this segment will be a herculean task for Marico.


3. Plant Protein

Consumers today are proactively seeking healthy and protein rich foods that can easily integrate into their daily routine. Soya Chunks are a great source of vegetarian protein. They are high in fibre, low on fat, versatile and can be cooked in multiple ways to suit various tastes.

In December 2020, Marico launched Saffola Mealmaker Soy Chunks. Its USP is the use of Super Soft Technology which makes the texture soft and spongy while absorbing all the flavours when cooked, hence keeping the nutritional value intact.

The soya granules market in India is quite fragmented and nascent. Ruchi Soya’s Nutrela brand being the first mover commands a predominant market share.

With increasing consumer awareness and robust demand for organic plant protein products, this could very well be a high growth category in the years to come.


4. Instant Noodles (Market size ~Rs.5000 Crore)

As people embraced the work from home culture during the pandemic, ready to cook snacks category is at full throttle, firing on all cylinders. This is just the beginning and India is a long way from reaching its zenith. The Indian market for instant noodles is set to grow 4.5 times by 2035 to an epic Rs. 21,000 Crore.

Marico recently ventured into the instant noodles category. In recent years they’ve successfully established ground with Saffola Masala Oats and retain 34% of the market share.

However, the instant noodles category will be a tough nut to crack with our favourite Maggi (Nestle) at the helm controlling 60% market share. Also, other brands like ITC's Sunfeast Yippee and CG Foods' Wai Wai maintain 22% and 9% market share respectively.

Do you think Marico is biting on more than it can chew? What is the rationale behind this product offensive strategy?

Maybe this will help clear things up.


Saugata Gupta, MD & CEO - Marico Ltd, stated in Q1 FY21 Earnings Conference Call -

“If we have taken on the ambition of having Rs.500 crores Foods business by the end of 2021-22, we need to look at categories which are tailwind, categories which have critical mass, categories with one single incumbent with high market share and then the rest being fragmented where Saffola or a strong brand can play with some differentiation.”

Marico aims to leverage their Saffola brand image and swiftly become the number 2 player in categories with one incumbent player like honey, ayurvedic and plant protein.



Saugata Gupta in an interview with Forbes India said –

“We are successful because we punch above our weight. We are an insurgent company and the trick is how to become a scaled insurgent for the long term.”

Will Marico float like a butterfly and sting like a bee in the long term through their latest endeavors?

You tell us.

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