Dabur India Ltd Management Discussions.

ECONOMIC SCENARIO

Global Economy

The unprecedented onset of Covid-19 pandemic has heavily impacted the global economy. The pandemic is raging high across the world with rising human casualties. Protecting lives and allowing health care systems to cope have required isolation, lockdowns, and widespread closures to slow the spread of the virus. The health crisis is therefore having a severe impact on economic activity. As a result of the pandemic, the global economy is projected to contract sharply by 4.9% in 2020, much worse than during the 2008-09 financial crisis (Fig 1.1).

Indian Economy

In the pre-COVID scenario, the Indian Economy continued the mid-single digit growth path. GDP growth in 2019 and first quarter of 2020 is shown in the following chart (Fig 1.2).

GDP growth has been slowing down during this period primarily due to declining rural wages, high unemployment levels, liquidity crunch in the system and slowdown in demand.

First few cases of Covid-19 infection emerged in India in February 2020. Travel restrictions and testing norms were put in place from 1st week of March and these intensified further in the following week leading to a complete lockdown of entire country on 24th March 2020. This led to severe supply bottlenecks as transportation system came to a halt. Large sections of migrant labour moved back to their villages and movement of goods came to a standstill. Demand also came under pressure as consumers stocked up essential goods but cut down on purchases of non-essential products. Most companies shut down their operations in the first 21 days of the lockdown.

By May 2020, the restrictions on movement of goods were eased and supply chains became operational, particularly outside the containment zones. While companies have started operations of their manufacturing facilities, a large part of the economy especially the hospitality sector, malls and recreation places, travel and tourism, small and medium industry, continue to be impacted even though there has been easing of lockdown in these sectors as well.

Dabur also announced a production shutdown across all its manufacturing units during first phase of the lockdown. Production resumed at some of our manufacturing units, after securing permissions for producing essential products and immunity-boosting Ayurvedic medicines that were gaining demand in view of COVID-19. We deployed innovative strategies and developed new solutions to ensure uninterrupted supplies to retail shelves, which included joining hands with Online Delivery Service providers like Swiggy, Dunzo and Zomato, and leveraging technology to drive sales and service orders. Details of the initiatives undertaken by Dabur have been presented in the Integrated Report section of this Annual Report.

OUTLOOK

The COVID-19 pandemic is likely to have a major negative impact across the world. It has led to quarantines, regional lockdowns and social distancing—which are essential to contain the virus —with particularly acute effects on sectors that rely on social interactions such as travel, hospitality, entertainment, and tourism. Workplace closures are disrupting supply chains and reducing productivity. Layoffs, lower incomes, fear of contagion, and heightened uncertainty make people spend less, leading to consumption squeeze and triggering further business closures and job losses. Health care expenditure, support to vulnerable sections of society and reduced tax revenue is likely to put severe pressure on fiscal balances of the government.

In such a scenario, as per IMF the Indian economy is expected to decline by 4.5% for 2020 as compared to growth outlook of 5.8% given by IMF in January 2020. Some of the developed economies are expected to decline even more significantly - USA is expected to decline by 8.0% and Europe by 10.2% during 2020.

Like the outlook by IMF, many rating agencies and investment banks expect a significant decline in Indias FY21 performance.

INDUSTRY SCENARIO Indian FMCG Sector

The Fast-moving Consumer Goods (FMCG) sector is the 4th largest sector of the Indian economy. During FY2019-20, the sector witnessed growth of 7.2% as per AC Nielsen, which is almost half of the 14% growth reported in FY2018-19.

The FMCG sector saw a sharp slowdown during the year on account of moderation in economic activity, low farm incomes and weak rural wage growth, liquidity crunch in the system, high unemployment levels and downtrading across categories. By March 2020, the sectoral growth dropped to 3.3% in value terms and 0.5% in volume terms.

The Corona virus pandemic has further impacted the sector since March 2020 due to restrictions on movement of goods, supply side bottlenecks and impact on consumption. Consumers have been stocking up essential products such as packaged foods, staples, tea, coffee, milk, detergents, and other products of daily usage. During this phase, demand has also surged for health and hygiene products as these aspects came into sharp focus. There was a surge in demand for hygiene products like sanitizers and disinfectants in addition to immunity building OTC and healthcare products. However, discretionary and nonessential items have seen weak demand as the focus during the lockdown has been on food and hygiene.

Outlook

Currently the path to recovery is still uncertain as the curve of infection has not yet flattened and there are more than 3,500 containment zones across the country.

Flattening of the curve across the country is likely to take a few months going by expert opinion and experience of other countries. Till then the demand patterns within FMCG are likely to change.

Changing Dynamics of the FMCG Sector

The FMCG landscape is undergoing a sea change with the emergence of COVID-19, which is also impacting consumer behavior across markets and geographies. We expect the following consumer trends to pick up in the post-COVID world:

1. Increased consumer focus on healthcare, particularly preventive healthcare, with a preference for Ayurveda- based solutions that boost immunity

2. Greater focus on Personal Hygiene with demand for hand and home sanitisers expected to grow exponentially

3. Discretionary spending would be curtailed due to shift of priorities towards essentials

4. Movement towards financial security to gain momentum

5. Technology to act as a catalyst for convenient, safe and enhanced consumer experiences

We also expect the industry to undergo recalibration of the supply chain and distribution network, with channels like e-commerce and Direct to Consumer gaining salience. Local kirana (grocery) stores have seen a resurgence as proximity and availability of products came into prominence. These retail outlets may become more organized, digitally enabled, and serviced directly. Recently, Indias Top 12 consumer goods companies, including Dabur India Ltd, have partnered with the government to convert millions of neighbourhood kirana stores into sanitised and safe retail outlets selling daily essentials. These kiranas will be called Suraksha Stores and linked to the governments Aarogya Setu app. The companies, in addition to registering these outlets as Suraksha Stores, will help the kirana staff implement safety norms such as social distancing and sanitisation, and supply them sanitisers, masks and gloves. The government is targeting to bring 1 million stores under this category in the first phase. This is the one of the several steps that FMCG companies are taking to push demand and ensure that retail shelves remain stocked in the eventuality of the lockdown and its impact on trade channels persisting.

According to Nielsen, the effects of the disruptions caused by COVID-19 would linger on for the rest of the year, prompting the market researcher to slash its 2020 growth outlook for Indias FMCG sector to 5-6% from its earlier projection of 9-10%. It further stated said that the long-term effects of the pandemic will have widespread impact in the months to come. However, FMCG sector is one of those which will be less impacted than others as demand for consumer staples is expected to revive as situation begins to normalize.

Health Care Industry

In view of Covid-19 pandemic, the need to build immunity and fight illnesses has gained prominence, not just in consumer mind space but also among the medical fraternity.

The demand for Ayurvedic products has been on the rise for a few years now. As per a report by IMARC, released prior to the COVID pandemic spread, Indian Ayurvedic products market is expected to grow at a CAGR of 14% during 2019-2024.

A key factor driving the Indian ayurvedic products market is increasing popularity of natural and herbal medicines and their benefits among the consumers. Factors such as rising health concerns and awareness about the side-effects of western medicines is further driving the consumer preference for Ayurvedic products in the country. Furthermore, the distribution network of ayurvedic products have improved significantly, increasing the accessibility of these products across both urban and rural regions.

The spread of the COVID-19 pandemic has led to a sharper resurgence in consumer interest, awareness and demand for Ayurvedic therapies and medicines. Within a month of the outbreak, ‘Immunity became one of the most searched words on Google, reflecting the shift in consumer preference. The word ‘Immunity saw a 500% increase while ‘Vitamin C searches went up by over 150% in 2020. There is today a significant interest towards immunity building, health and hygiene products and the adoption rates are improving as well. The government through the Ministry of AYUSH has been encouraging citizens of India to use Ayurvedic products and practice Yoga to build immunity. As per an advisory issued on 31st March 2020, the AYUSH Ministry had, among other measures, recommended the following to boost immunity to fight illnesses:

• Take Chyawanprash 10gm (1tsp) in the morning. Diabetics were advised to take sugar free Chyawanprash.

• Drink herbal tea / decoction (Kadha) made from Tulsi (Basil), Dalchini (Cinnamon), Kalimirch (Black pepper), Shunthi (Dry Ginger) and Munakka (Raisin) - once or twice a day. Add jaggery (natural sugar) and / or fresh lemon juice to your taste, if needed.

• Golden Milk- Half tea-spoon Haldi (turmeric) powder in 150 ml hot milk - once or twice a day. (Source: Ministry ofAyush)

Prime Minister Mr. Narendra Modi has also been promoting Ayurveda and Yoga on various forums. These initiatives have further established the long-term relevance of Ayurveda and its role in natural healthcare.

Home & Personal care Industry

Indias home and personal care industry encompasses home care products like household cleaners, detergents, toilet cleaners and air fresheners and personal care products like hair oils, oral care products, skin care and cosmetics. With downtrading increasing across categories, most of the subsegments like Hair Care and Oral Care saw low single-digit growth in the full year 2019-20. Indias household care industry, on the other hand saw high single-digit growths on the back on rising awareness about health and hygiene.

Ever since the COVID outbreak, the consumer need for hygiene products - ranging from hand sanitisers to household disinfectants - has gone up significantly. According to Nielsen India, demand for such products jumped by nearly three-fold. To cater to this growing need, companies across sectors diversified into manufacturing hygiene products for sanitizing hands and personal spaces within homes. Dabur also advanced the launch of its hand sanitizer by nearly a quarter to mid-March, in order to meet the emerging need gap. We have since expanded this portfolio with the introduction of air sanitisers, all-purpose disinfectants and sanitizing floor cleaners. This increasing awareness on personal hygiene, coupled with the rise in adoption of digital media, social media and e-commerce, consumption of home and personal care products is likely to sustain. Going forward, in the Covid-19 world, we might see consumers spending more on essential personal care products and lesser on discretionary personal care products. Consumers are likely to increase focus on value for money with premium category likely to see a moderation. However, some of these trends may be temporary in nature and a rebound is likely to happen post Covid.

Foods Industry

The Food sector, which contributes to 57% of the overall FMCG market, comprises broad categories like packaged Atta, rice, edible oil, dairy products, beverages, baby food etc. During the year, this category witnessed growth of 8-9%. While the Food sector, riding on demand for consumer staples, has been growing at a good pace, the Juices & Nectars segment saw some pressure over the past year on account of downtrading by the consumers to lower priced alternatives such as milk-based and carbonated beverages/drinks. That said, the Juices & Nectars market is still heavily underpenetrated and has a huge headroom for growth by capitalizing on innovations both in formats and extensions.

Due to the extended lockdown in India, cooking at home was a big theme due to which convenience foods and cooking ingredients were in high demand. Daburs Culinary portfolio under the Hommade brand tapped the ‘Chef within households during the lockdown with a range of easy-to-prepare online recipes. These trends may get strengthened going forward as Covid effect is expected to last for a while.

COMPANY OVERVIEW

Dabur India Ltd is the largest Ayurvedic and natural health care company in the country with a portfolio of over 400 products. With its wide distribution network, covering

6.7 million retail outlets, and presence across urban and rural markets, Dabur products are among the most trusted brands in the country offering holistic health and well-being.

We have manufacturing facilities spread across 11 locations in India and 8 overseas. Known as the original custodian of Ayurveda, Dabur has been at the forefront of innovation to make the traditional knowledge of Ayurveda more contemporary and in sync with the changing needs and aspirations of millennials and centennials.

The year 2019-20 was marked by an overall slowdown in the industry, which was aggravated by a liquidity crunch in the market, stress on disposable incomes and growing unemployment. At Dabur, we have taken steps to mitigate the impact of these headwinds and invested in expanding our rural footprint. Dabur invested ahead of the curve in expanding its rural coverage, which helped us drive growth even during the slowdown. We increased our rural network to cover 52,298 villages by end of FY20, up from 44,068 villages in March 2019. With this, we have built a strong foundation for sustainable profitable growth in rural market.

Alongside, we are expanding our product basket for rural consumers by way of newer low-priced packs to feed these markets and push demand growth. During the year, Dabur introduced low-priced packs in categories like Foods, Hair Oils, and Oral Care

A year ago, Dabur had embarked on a new growth strategy, identifying and focussing on its key Power Brands as the drivers of growth for the future. The Company sharpened its focus on the Power Brands through increase in brand investments, enhancing distribution reach and driving innovation. More details of this strategy have been provided in the initial sections of this report. A number of these Power Brands are in Healthcare space, which was in line with the companys renewed focus on Ayurveda and Healthcare as being the growth engines. These initiatives have helped us drive demand for these brands through most part of the year.

Ayurveda and Ayurvedic products have been gaining wider acceptance with a growing number of young Indians embracing these traditional products and medicines. Dabur has also intensified its focus on Ayurveda with the launch of a slew of new products and initiatives, such as:

• Dabur Babool Ayurvedic Toothpaste: Packed with powerful Ayurvedic ingredients like Babool, Clove, Triphala, Pudina and Patchouli, it offers all-round protection for the entire family from all dental problems.

• vatika Ayurvedic Shampoo: An Ayurveda-based shampoo that offers gentle cleansing and conditioning.

• Dabur Kabz Over: Available in easy-to-consume granules format, it is packed with powerful ingredients like Haritaki, Ajwain, Castor Oil, Saunth, Senna and Saunf. This 100% Ayurvedic formulation is highly effective in providing effective relief from constipation, gas and acidity.

• Dabur Tulsi Drops: A natural Immunity Booster, it also helps build respiratory health and provides effective protection from Cough and Cold. Dabur Tulsi Drops has antioxidant, antimicrobial and adaptogenic properties that deliver 10 key health benefits including heart health, digestion, skin health, eye health, improved functioning of joints and liver besides relief from cough and cold.

• Dabur Haldi Drops: It has curcumin extract which helps boost immunity and reduce inflammation. It also has antioxidant properties and helps to cure cough and cold and is beneficial for skin and joint health.

• Dabur Amla Juice: A concentrated juice of Indian gooseberry, this is a natural immunity booster.

• Dabur Giloy-Neem-tulsi Juice: A combination of three potent immunity-building herbs.

• Range of 8 Ayurvedic churnas: A range of eight single herb Churnas, which includes three Immunity-boosters like Giloy Churna, Amla Churna and Ashwagandha Churna. The other products in this range are Trikatu Churna, Hareetaki (Harad) Churna, Neem Churna, Arjun Chhal Churna and Brahmi Churna.

• Dabur Ayush kwath kaadha: A concoction of Tulsi, Shunthi, Dalchini and Maricha, Dabur Ayush Kwath Kaadha is an immunity booster recommended by Ministry of AYUSH for strengthening your bodys internal Immune system to fight illnesses. It is also useful in managing cough, cold and sore throat.

• Dabur Immunity kit: A holistic kit, containing 6 immunity boosting products like Dabur Chyawanprash, Giloy ki Ghanvati (Giloy tablets), Giloy Churna, ImuDab (Immunity building syrup), Honitus and Stresscom (Ashwagandha) capsules. This kit was launched to offer consumers a holistic package of immunity boosters in the wake of the COVID outbreak.

Some other new products launched during the year include Dabur Sanitize Multi-Surface Disinfectant Spray, Dabur Sanitize Antiseptic Liquid, Dabur Sanitize Antiseptic Soap, Dabur Sanitize Laundry Sanitiser, Dabur Veggie Wash, Dazzl Floor Cleaner, Dazzl Disinfectant Spray, Dabur Amla Aloe Vera Hair Oil, Dabur Badaam Amla Hair Oil, Fem Fruit Bleach, Dabur Sanitize Hand Sanitiser, Dabur Sanitize Disinfectant Spray, Dabur Sanitize Air Sanitizer, Dazzl Surface Cleaner,

Dazzl All-Surface Disinfectant and Odonil Air Sanitiser. We also launched Dabur Suraksha Kit which comprises a reusable face shield, hand sanitizing rub, reusable face mask, washable hand gloves and a reusable head cover. In the foods category the company launched Real Pink Guava, Real Aloe Vera Kiwi, Real Mixed Berries Juice, Real Masala Sugarcane Juice, Real Masala Mixed Fruit Juice, Real Masala Aam Panna, Real Fruit ORS and Real Activ Coconut Water in a tetra pack. In addition, Fem Hand Wash range was also repositioned as an effective hygiene solution by highlighting its Germ-Kill properties.

Strategic Business units

Dabur has a diversified product portfolio that covers key FMCG categories like Health Supplements, OTC, Hair Care, Oral Care, Skin care, Home Care and Foods. A significant portion of this portfolio consists of natural and Ayurvedic products. Daburs business structure is divided into three Strategic Business Units (SBUs):

• consumer care Business: This includes Health Care (HC) and Home & Personal Care (HPC) businesses, which together account for 57.6% of Consolidated Sales

• Foods Business: This comprises Packaged Fruit Juices and Culinary Products, which account for 10.9% of Consolidated Sales

• International Business: A mix of Daburs organic overseas business as well as the acquired entities of Hobi Group and Namaste Laboratories LLC, this segment accounts for 28.2% of Consolidated Sales

The Consumer Care Business and Foods Business together make up the India FMCG business for Dabur. The Revenue mix of these SBUs is presented in Fig 3.1.

Indian FMCG Business Health Care

Health Care business contributes to 33.9% of Daburs India FMCG business. While the category witnessed a growth of 5.9% during the year 2019-20, the growth in the first 11 months of the fiscal ("YTD Feb20") was 11.4%. This vertical comprises sub-categories like Health Supplements, Digestives, OTC and Ayurvedic Ethicals. Ayurveda is the common thread binding most products in our Health Care bouquet.

• Health Supplements category for Dabur reported 8.2% growth during the current fiscal and 12.9% in YTD Feb20 with almost all brands reporting strong growths.

Factors such as rising awareness about the importance of a healthy lifestyle, increasing preference for chemical- free natural products, as well as favorable government initiatives have helped drive consumer preference for Ayurvedic products in the country. According to a recent report released by IMARC, the Indian Ayurvedic products market is expected to grow at a CAGR of 14% between 2019 and 2024. With the government also promoting the usage of Ayurvedic products through awareness programs, its popularity is slated to increase in the coming months and years.

In the wake of the Covid-19 pandemic, there has been an increased consumer interest in Ayurvedic products that help boost immunity. Even as Governments and Pharma industry are trying hard to find a vaccine for the novel Coronavirus, enhancing our immunity has emerged as the best way to save ourselves from the deadly virus.

Dabur Chyawanprash: The flagship health supplement brand in the Dabur portfolio, Dabur Chyawaprash is a time-tested Ayurvedic formula that helps build the bodys immunity and helps fight infections. Packed with over 41 potent Ayurvedic herbs, Dabur Chyawanprash has been recommended by the Ministry of Ayush for building immunity to combat Corona virus infection.

Key Highlights for FY 2019-20:

High decibel campaigns launched to highlight the positive impact of Dabur Chyawanprash in fighting ill-effects of pollution and infections during monsoon.

Signed film star Kajol as the new face of the brand.

Immune India campaign rolled out across the country to engage with Ayurvedic doctors highlighting the immunomodulatory effects of the brand and creating awareness about health and immunity requirements.

With the onset of winters, extended the Immune India campaign to cover underprivileged kids across the country. Under this initiative, Dabur Chyawanprash joined hands with leading NGOs from 14 cities in India and conducted Immunity awareness sessions to educate children.

Series of digital campaigns and special initiatives on news channels highlighting the importance of boosting the bodys immune system in the fight against COVID-19 pandemic.

Dabur ChyawanPrakash, the Sugar free variant, continued to gain ground with health-conscious and diabetic consumers.

Overall market share of Dabur Chyawanprash soared 325 basis points to touch an all-time high of 62%.

Dabur Honey: A leading health product from the House of Dabur reaffirmed its position as a market leader by specifically focussing on healthy living and weight management. A series of campaigns, based on the Ayurvedic wisdom that consuming honey with lukewarm water helps fight obesity and manage weight, was rolled out on both mainstream media and digital media.

Key Highlights for FY 2019-20:

Dabur ran a special campaign to highlight the superiority of Dabur Honey over price warriors in the market. This ‘Pure Honey, Dabur Honey campaign highlighted the 60 plus tests that every batch of Dabur Honey undergoes to ensure its purity.

Signed Southern actress Tamannaah Bhatia as the regional face of Dabur Honey and launched a new campaign for South India talking about the brands benefits in weight management.

During Durga Puja, Dabur Honey joined hands with some of the popular sweet shops in Kolkata to co-create a range of traditional sweets using Dabur Honey.

A single-use Tub pack of Dabur Honey was introduced during the year. This pack was extensively sampled to over 2 lakh users through Indian Railways.

The brand participated in over 15 marathons across the country to promote Dabur Honey as a leading Health brand.

With the COVID outbreak and the resultant lockdown, the brand launched a digital campaign that promoted a series of quick healthy recipes for consumers using Honey

Dabur Honey rolled out a #StayFitFromHome campaign on social media, which saw its brand ambassador Jacqueline Fernandes and the regional brand ambassador Tamannah Bhatia posting about their fitness regime during the lockdown.

Dabur Glucose: The third major brand in this category, Dabur Glucose continued to grow during the summer months, riding on a high-decibel campaign featuring Ajay Devgn and the launch of a new variant Aam Panna. We continue to drive growth for this brand through flavoured variants and saw our market shares go up by almost 100 bps.

• Digestives category for Dabur reported an 8% growth in 2019-20 and 14.2% in YTD Feb20

Digestive disorders are one of the most common health problems faced by people in India, with some research even suggesting that almost seven out of 10 people suffer from digestive health issues in the country. Unhealthy lifestyles, skipped meals, eating out and unhygienic fast foods are some of the main culprits for this rise in digestive disorders.

Over the years, consumers have been preferring herbal and traditional products to address their digestive problems as these products are less susceptible to side-effects.

Dabur has been a leading player in the herbal digestives market with a wide portfolio under key brands like Hajmola, PudinHara, Hingoli, Dabur Nature Care and Sat Isabgol. The year saw the launch of two new

brands in this category - Dabur NatureCare Kabz Over and Dabur Soda Fizz. Available in easy to consume granules format, Dabur NatureCare Kabz Over is packed with powerful ingredients like Haritaki, Ajwain, Castor Oil, Saunth, Senna and Saunf. This 100% Ayurvedic formulation is highly effective in providing effective relief from constipation, gas and acidity. Dabur Soda Fizz, on the other hand, is an effervescent remedy for gas and acidity. Available in a granular effervescent powder format, it provides quick relief from stomach ailments like stomach-ache, gas and indigestion.

Hajmola: The flagship digestive brand, Hajmola has a distinct tangy taste which has endeared this brand to consumers from all age groups for generations. The brand comes in 6 tasty variants: Regular, Imli (Tamarind), Pudina (Peppermint), Anardana, Amrud (Guava) and Chatcola. We added a new flavour to the portfolio this year with the launch of Chatpati Hing (Asafoetida) variant.

The brand rolled out a series of campaigns on digital media to connect with consumers and ride on the growing demand for the new variants like Chat Cola and Chatpati Hing.

Key Highlights for FY 2019-20:

Over 1 crore samples of Dabur Hajmola distributed at Restaurants, Schools, Airlines and through Dabbawalas in Mumbai.

A series of digital campaigns and memes, focussing on moment marketing to take advantage of current events like the Cricket World Cup, Chandarayaan launch, were rolled out to deliver relevant and spontaneous interactions with consumers. Some of these memes and campaigns were widely shared on social media by consumers and helped build a real-time connect with consumers and create a high brand recall.

The brands popular promotional activity Hajmola Chunavi Dangal, which was created a year ago around the Elections to promote awareness on Voting was extended to Nauchandi Mela in Meerut this year. A special booth was created, where a mock election was held to identify the consumers favourite flavour from the Hajmola digestive tablets range. Various Hajmola flavours were sampled with the consumers, who were then asked to vote for their favorite flavour, and the winning flavour was declared the ‘Mukhya Flavour Mantri 2019. Hajmola Chunavi Dangal received the ACEF Award for innovative customer engagement.

Hajmola was ranked amongst Indias 100 Most Trusted Brands by The Economic Times-Brand Equity Survey.

To celebrate the unique bond between brothers and sisters on Rakshabandhan, Hajmola came up with #BaatHazamNahiHui campaign showcasing the chatpata moments people experience with their siblings. As a part of this campaign, a set of three digital films were launched with three different yet relatable stories on the bond between siblings.

A profile pouch for Hajmola Candy was introduced in Modern Trade outlets during the year.

Pudin Hara: A proven Ayurvedic remedy for digestion issues, Pudin Hara is available in three formats of Liquid, Pearls and powder Fizz. It is an iconic proprietary formulation which addresses stomach pain and indigestion through herbal ingredients such as pudina satva (mint).

Key Highlights for FY 2019-20:

Sampling is the biggest lever to drive consumer trials in this category. The brand undertook large- scale consumer connect initiatives at religious and social fairs, like Magh Mela and Chitrakoot Mela, across the country.

The brand undertook a high-decibel activation at the Nauchandi Mela in Meerut this year with the ‘largest Glass Bottle of Dabur Pudin Hara, an actual replica containing over 400 litres of Pudin Hara liquid. Dabur Pudin Hara entered the Limca Book of Records for this feat.

A special digital video was also created around the mela - with a catchy tune ‘Pudin Hara Banke that became one of the most widely shared videos on digital platforms

Sampling activities were also undertaken in Rajdhani and Shatabdi trains.

Television star Kapil Sharma was signed as the new face of Pudin Hara and a new TVC will be rolled out soon.

• Ayurvedic OTO and Ethicals category for Dabur was flat in 2019-20 and grew by 6.7% in YTD Feb20.

Dabur is the leading player in the Ayurvedic products category with a wide range of products. Daburs OTC portfolio today includes products in categories such as Immunity Boosters, Cough & Cold, Womens Health Care, Baby Care and Rejuvenation. We also have a large Ayurvedic Ethicals portfolio.

In the days and weeks following the COVID-19 outbreak, the demand for immunity boosters witnessed a surge. As the world scrambled to find a cure for COVID-19, health experts suggested that boosting the bodys immune system may help in preventing the onset, minimize the infection and hasten recovery from the disease. Ayurvedic herbs such as Tulsi, Cinnamon, Black Pepper, Shunthi (dry ginger) and Raisins were recommended as potent aids to increase the bodys immunity against harmful viruses. To meet this emerging need, Dabur fast-tracked the launch of a host of immunity boosters, besides increasing production of its existing range of products containing highly effective immunity building herbs like Ashwagandha, Giloy, Amla etc.

Immunity Boosters: Immunity, as we understand it through modern medicine, is the function of certain cells, enzymes and immunomodulatory chemicals that attack pathogens and prevent them from creating diseases. As a branch of holistic healing, Ayurveda lays emphasis on strengthening your bodys immunity to deal with chronic infections and illnesses. These Ayurvedic products and remedies can be consumed regularly to charge the bodys immunity, naturally.

I n the wake of the COVID outbreak, the demand for specialised and natural Immunity booster products have grown exponentially.

Key Highlights for FY 2019-20:

The company launched Dabur Tulsi Drops, a 100% Ayurvedic remedy that is a natural Immunity Booster and also helps build respiratory health and provides effective protection from Cough and Cold. Dabur Tulsi Drops is a mixture of 5 types of rare Tulsi leaves like Vishnu Tulsi, Rama Tulsi, Shyama Tulsi, Bisva Tulsi and Amrit Tulsi.

Launched Dabur Haldi Drops, which has curcumin extract and helps boost immunity and reduce inflammation. It also has antioxidant properties and helps to cure cough and cold and is beneficial for skin and joint health.

Launched a range of eight single herb Churnas, which includes three Immunity-boosters like Giloy Churna, Amla Churna and Ashwagandha Churna.

Introduced Ashwagandha capsules. A true superfood, Ashwagandha herb is known for its healing effect on the body and protection

from infections. The herbs natural immuno- boosting properties can also help deal with chronic stress and fatigue which happen with viral infections.

Ventured into the immunity-building juices market with the launch of Dabur Amla Juice and Dabur Giloy-Neem-Tulsi Juice.

We also put together a 6-in-1 Immunity Kit containing products like Dabur Chyawanprash, Giloy ki Ghanvati (Giloy tablets), Giloy Churna, ImuDab (Immunity building syrup), Honitus and Stresscom (Ashwagandha) capsules which was sold on ecommerce platforms.

Special campaigns launched in Digital media and Mainstream media, to highlight the various Immunity booster products in the Dabur portfolio and generate awareness about their benefits.

Cough & Cold: Changing weather conditions, high levels of pollution have led to increasing incidence of cough, cold and allergy in India.

Demand for Ayurvedic products, particularly in the area of cough and cold remedy, has been on the rise. Dabur is a leading player in this market with its brand Dabur Honitus, which features an array of Ayurvedic products like Honitus cough syrup, Honitus Lozenges, Honitus Hot Sip (a ready-to-use Ayurvedic kadha) and Honitus Madhuvani (a traditional Ayurvedic Medicine for Cough and Cold). Given its non-drowsy Ayurvedic formulation, Honitus Cough Syrup is a scientifically proven remedy for cough. It is fortified with Tulsi, Mulethi & Banapsha to provide fast relief against acute cough and throat irritation.

Key Highlights for FY2019-20:

Rolled out campaigns to highlight the ‘natural and ‘no side-effect proposition of Honitus cough syrup.

Special tie-ups with Bollywood movie ‘Mission Mangal and Bengali movie ‘Professor Shanku to promote the brand.

I mproved visibility of Honitus Hot-Sip Ayurvedic kadha, with campaigns promoting it as a solution for pollution-related throat ailments. We also introduced a smaller 6-sachet consumer pack of Honitus Hot-Sip.

Introduced Honitus Adulsa, a cough syrup containing the Adulsa herb. This product has been created especially for the western markets where

the herb is known for its soothing effect for coughs and as a treatment for respiratory disorders.

Womens Health Care: Dabur has a range of authentic Ayurvedic products for Womens Health Care. The product range includes Dashmularishta Asav, Ashokarishta Asav, Dabur Activ Blood Purifier, Dabur Woman Restorative Tonic and Dabur Lauhasava. Dashmularishta is a potent formulation for women, which combines the goodness of dashmool with other herbs, and helps in recovering from post-delivery related stress and weakness effectively and naturally. Known as the ‘natural friend of a woman, Ashokarishta provides hormonal balance and improves reproductive health. A new television commercial was launched this year for Dabur Lauhasava, an Ayurvedic medicine for Iron Deficiency and Anaemia. All products in this portfolio performed fairly well in the market during the year.

Baby Care: Dabur Lal Tail is an ayurvedic baby massage oil formulated with potent herbs recommended in Ayurveda to help babys overall healthy development. It is clinically proven to help healthy muscle development and strengthen the babys bones.

Key Highlights for FY2019-20:

As part of our local communication strategy, we signed Marathi film and television actress Shruti Marathe as the new face of the brand in Maharashtra.

To reach out to new mothers, Dabur is working with mother bloggers to create awareness about the health benefits of Dabur Lal Tail.

A special Gift Box with Dabur Lal Tail was developed and distributed in Maternity Homes.

Rejuvenators: Daburs Rejuvenator portfolio, which includes products like Dabur Shilajit, Shilajit Gold, reported steady growth during the year, driven mainly by ecommerce. The range is good for general health and well-being, and helps increase strength, stamina, vigour and vitality.

Ayurvedic Ethicals: Ayurveda is at the core of Dabur, and this business is the foundation on which Dabur was born in 1884. This portfolio covers over 250 products and medicines, prepared on the basis on formulations written in ancient scriptures, to treat and manage a variety of ailments, including several lifestyle diseases that people are facing today.

Dabur has always believed in the goodness of Ayurveda and has been introducing products that offer the

benefits of Ayurveda to meet the ever-changing needs of consumers. Alongside, we have been working towards contemporizing and popularizing Ayurveda among the new generation.

A host of new products were launched during the year to expand the Dabur Ayurvedic Ethicals portfolio. The business demonstrated a robust performance during the year, increasing Daburs share in the market.

Key Highlights for FY 2019-20:

In addition to the three immunity boosting churnas mentioned before, Dabur launched five new Churnas: Trikatu Churna, Hareetaki (Harad) Churna, Neem Churna, Arjun Chhal Churna and Brahmi Churna.

Five new Ayurvedic medicines were also launched during the year: Arshoghani Vati for Piles; Punarnavadi Mandoor for Anaemia; Amla Pittantak Lauh for treating acidity and stomach pain; Navayas Lauh for liver function improvement and Saptamrit Lauh for toning eye muscles.

The year also saw the national launch of Dabur Ratnaprash (the premium health tonic) and Dabur Keratex Hair Oil (an Ayurvedic hair oil).

During the year 2019-20, Dabur conducted 1,280 Health Camps across the country, offering free consultations and subsidized medicines to the poor and needy. Over 150,000 patients benefited from these Health Camps.

Reached 4.9 million consumers through the Mensta #NoWomensDay Campaign across digital platforms highlighting that women need to be given respect and care on all 365 days of the year and not just on Womens day. The Campaign received overwhelming response across the country and was featured on prestigious platforms.

Reached 8 lakhs+ consumers in 7 days with Active Antacid Suhana Safar with RSRTC (Rajasthan Road Transport Corporation) across 10 cities in Rajasthan

OPD camps for Gynaecology and General Practitioners were organized daily with doctors offering free consultations to patients. Free medicines were also offered to the needy.

Health camps were organised during regional religious fairs like Pandarpur Yatra, where the pilgrims were offered services like Health checkups, Ayurvedic foot and back massage with Dabur

Rheumatil Oil. The Pandarpur Yatra campaign won a prestigious Gold award at the SEAC Singapore Customer Engagement Forum 2019. Besides, Ayurveda vans were deployed, offering mobile health care services to the devotees.

Dabur also organised Swarna Prashana camps every month across the country on Purnima or full moon nights. As part of this camp, the medicines are kept exposed to moon rays through the night and consumed early morning with Vedic chanting. A special Sharad Purnima Ayurvedic Treatment Camp was organised in Bhopal for treating long-standing respiratory diseases and allergies such as Asthma, Bronchitis, Chronic cough & cold, sinus etc. The unique all-night Health Camp was organised to provide relief to Bhopal Gas Victims.

The Company expanded its doctor engagement to regional markets under the ‘Samvaad initiative, which is a forum for discussing Ayurvedic products, practices and developments. We organized 200 Samvaad meets during the year.

The Medico Marketing team was expanded with the addition of 150 people taking the total team strength to over 600. We enhanced our doctor coverage from 48,000 to 59,288.

Home & Personal Care

Daburs Home & Personal care vertical contributed 50.1% to India FMCG business and saw a flat growth during the year. Growth in YTD Feb20 period was 5%. This vertical includes four key categories: Hair Care, Oral Care, Skin Care and Home Care.

The rapid spread of COVID-19 has brought to the fore the consumer need for personal hygiene products. Dabur has also entered the personal hygiene space with the launch of a new brand - Dabur Sanitize. In addition, a range of products have been introduced in the home hygiene space to cater to the growing consumer need.

• Daburs Hair Care business declined by 1.1% during the year and grew by 4.3% in YTD Feb20.

The Hair Care business for Dabur comprises Hair Oils and Shampoos. It contributed to 21.1% of the India FMCG business.

Hair Oils: Hair oiling is an age-old phenomenon in India and is seen as most beneficial for strengthening and nourishment of hair besides reducing hair fall. The good old ‘champi or hair massage continues to be popular across India besides usage of hair oils as a grooming aid.

One of the oldest and most prominent players in the Hair Oils market in India, Dabur offers a wide range of products with popular brands like Amla, Vatika and Anmol.

Dabur continued to grow faster than the Hair Oil category, gaining on all parameters, be it market share, penetration or distribution.

Key Highlights for FY 2019-20:

The company enhanced brand spends on Dabur Amla Hair Oil and focussed on special campaigns around the brands popularity and legacy. These campaigns also highlighted the fact that Dabur Amla Hair Oil is the No. 1 hair oil in the world.

As part of a strategy to reach out to new-age consumers, Dabur entered the kids hair care space with a range of products, specially targeting the online retail space, under the Dabur Amla brand. The new Dabur Amla kids range includes Dabur Amla Kids Nourishing Hair Oil, Dabur Amla Kids Nourishing Shampoo and Dabur Amla Kids detangler, which were launched exclusively on e-commerce platforms.

Enhanced focus on Anmol brand to increase its penetration across markets in the coconut oil category.

Rolled out a series of digital campaigns to increase connect with the millennials. In order to salute the spirit of women frontline workers who have actively been supporting the nation during the corona virus crisis, Dabur Amla Hair Oil launched a special social campaign to laud their efforts. The film, which was executed in a flip book style depicting the various COVID warriors getting ready for their duty to serve humanity, lauded the efforts of lady doctors, nurses, sanitation workers, aid givers, police officers and journalists for their services during the lockdown.

Dabur Amla created another digital campaign around building bonds with loved ones during this

lockdown. This campaign focussed on the mother- daughter bond, especially during the lockdown with the tagline "Apni jadoon se rishta banao".

Embarked on a new regional strategy by roping in local celebrities as brand ambassadors and creating special TVCs for key southern markets.

Dabur Amla Hair Oiljoined hands with the Government of Uttar Pradesh to promote and propagate the ‘Beti Bachao, Beti Padhao campaign launched by Prime Minister Narendra Modi. Under this initiative ‘Tu Padhti Ja, Tu Badhti Ja, Dabur Amla is reaching out to more than 50 Government schools across the state, covering around 25,000 girl students to drive awareness about the importance of education and offer scholarships to help bright and needy students pursue higher education.

Shampoos: The Shampoo portfolio accounts for 15.3% of Daburs Hair Care business. Dabur operates in this category with a range of shampoos under the brand Vatika. We extended our shampoo portfolio this year with the launch of Vatika Ayurvedic Shampoo, a unique formulation that offers gentle cleansing and conditioning with improved sensorials.

Key Highlights for FY 2019-20:

We relaunched the entire bottle portfolio of Vatika shampoo range with an entirely new packaging. New SKUs were also launched, especially for Modern Trade outlets, which improved the bottle saliency for Vatika shampoo.

Created better value for consumers in the shampoo sachet market by giving consumer a larger sized sachet with more shampoo for the same price of Re 1.

Used digital media and Social media to build greater connect with millennials by sharing Do-It-Yourself Hair Care and styling videos and posts.

Oral Care business continued to perform well and reported a 7.0% growth in YTD Feb20 and 1.8% during the year.

The recent years had seen considerable expansion of the Herbal Oral Care market in India, riding on heightened demand for traditional and Ayurvedic ingredients. The Oral Care business for Dabur comprises Toothpastes and Toothpowder.

Our flagship brand Dabur Red Paste continued to outperform the category, growing by nearly two times the category growth rate. Dabur Red Paste has today emerged as the No. 1 toothpaste brand across several

markets like Odisha and Andhra Pradesh. It has also emerged as a close 2nd in Tamil Nadu.

Targeting the value segment of the herbal toothpaste market, the company launched Babool Ayurvedic Paste which is packed with powerful Ayurvedic ingredients like Babool, Clove, Triphala, Pudina and Patchouli, offering all-round protection for the entire family from all dental problems.

The toothpaste industry faced a slowdown in demand with consumers downtrading to smaller packs, pushing down industry growth rates to low single digits. Despite the sharp decline in growth rates across the industry, our toothpaste franchise continued to grow ahead of the market and reported steady market share gains.

Key Highlights for FY 2019-20:

Dabur effectively used communication, both in mainstream media and digital media to drive relevance and consumer recall for the brand. While the television commercials were more functional and thematic, talking about the brand benefits, the campaigns on digital and social media were designed to build brand love and consumer connect. The various digital campaigns by Dabur Oral Care brands gathered over 50 million impression on Digital media.

Moment marketing was effectively used to drive the brand connect for Dabur Red Paste with consumers around special occasions like Cricket World Cup. The brands Cricket World Cup campaign, with the #SabkoChabaJaayenge, was an instant hit.

A slice of life digital campaign, #ChabaateRahoIndia, was launched by Dabur Red Paste to talk about the everyday tasks we undertake with our teeth. This film was later recrafted during the COVID-imposed lockdown to reflect the current mood and ‘hunger swings of many who are homebound due to the lockdown. The film was entirely shot indoors on mobile phones and handycams by the actors and their family members.

Dabur Red Paste was featured for the fourth consecutive year in the Brand Equity 100 Most Trusted Brands list.

With consumers shifting to lower priced packs during the slowdown, Dabur also upped its ante and engaged in an aggressive low-priced unit play in the Oral care market with the launch of Rs 10 packs. This helped us increase penetration and distribution reach across markets.

• Skin Care & Salon business for Dabur reported a growth of 2% in YTD Feb20 and a decline of 2.7% during the year.

With the growing awareness about beauty care, consumers are increasingly adopting healthy diet, adequate water intake, exercise and natural products for the daily Skin Care routine.

With the changing market dynamics, brands are now working towards adding value and creating differentiation to build a long-term relationship with consumers. Also, the consumer preference for natural ingredients and products to solve any health or skin issues is growing in India.

Dabur operates in the Skin Care category with three key brands - Dabur Gulabari for mainstream rose-based skin care products, Fem for facial bleaches and hair removal creams, and OxyLife for oxygen-infused premium facial bleaches and facial products. The year also saw Dabur enter the Male Grooming market under the OxyLife brand.

Gulabari: Dabur Gulabari has been positioned as the teenagers first skin care product. The brand, which features products like Rose Water, Face Freshener and the winter specific Moisturising Cold Cream and Lotion, witnessed a muted growth during the year mainly due to competition from counterfeit and unorganized sector. The brand is undergoing a packaging change to counter spurious product makers and stay ahead of competition.

Fem: Daburs flagship brand in the facial bleach category, Fem had been facing increased competition from discount players in the market. The brand countered the intensifying competition with the launch of new formats and lower price point packs to end the year with good growth and market share gains.

Key Highlights for FY 2019-20:

Launched Fem Herbal at Rs 20 price point to tap into entry level price point and new users

Dabur expanded the Fem bleaches range with the launch of a Fruit Bleach variant.Fem continued to partner with influencers on social media to talk about benefits of bleaches and counter the myths around bleaching. During the COVID lockdown, it

also created special content for consumers about Skin Care and bleaching at home.

Dabur relaunched the entire Fem Hair Removal cream range. The brand also aired a new campaign featuring Bollywood actress Kriti Sanon.

OxyLife: The premium Skin Care brand from the House of Dabur, OxyLife continued to report strong growth in both the facial bleach and the Salon Care & Facial range. The OxyLife Salon business reported strong double-digit growth during the year.

Key Highlights for FY 2019-20:

Dabur expanded the OxyLife Facial Kit range with the launch of two new products - Pro-radiance Kit and Pro-White Kit.

The year 2019-20 marked OxyLifes entry into the male grooming market with the launch of OxyLife Men Hair Removal Cream. This dermatologically- tested premium product is enriched with OxySphere technology and contains natural ingredients like tea tree oil and menthol to provide smooth, clean and bright skin.

• Personal Hygiene is a new category for Dabur

In the wake of the Covid-19 pandemic, there has been a sharp rise in demand for hygiene products like hand sanitisers. According to a Nielsen report, the hand sanitiser segment in India witnessed a mammoth growth of 53% in February, as against 11% from November-January. Some industry estimates forecast that the personal hygiene market is expected to reach US$15 Bn by 2023 in India.

Given the sudden surge in consumer need for such products, Dabur advanced the launch of its hand sanitizer by a couple of months and introduced it under the Dabur Sanitize brand in March 2020.

A range of alcohol-based Hand Sanitizers, that is highly effective in providing protection from disease-causing germs, was initially launched across all e-commerce platforms to ensure quick delivery to consumers. It is available in three fragrances - Regular, Lemon &

Strawberry - and comes in five SKUs. In the following weeks, the Dabur Sanitize range was launched across all channels and markets.

• Home Care category reported 5.1% growth during YTD Feb20 and 1.1% growth during the year.

The Home Care or Home Hygiene market in India is witnessing a strong expansion with consumers becoming more aware about the importance of hygiene within their living spaces.

The growing importance of healthier living spaces with rising concerns among individuals about hygiene and keeping homes free of germs, in the wake of the COVID spread, has led to a rise in demand for Home Hygiene products. In the new normal, hygiene and Germ-Kill are expected to be built into all brands in the Home Care space.

Dabur operates in the Home Care category with brands like Odonil, Sanifresh and Odomos. In the wake of the COVID-19 spread, the company expanded its offerings in the Home Care market with the launch of new Home Hygiene products like Air Sanitisers, Disinfectants, Floor Cleaners and Surface Cleaners.

Odonil: Dabur operates in the Air Freshener market with its brand Odonil, which underwent a complete identity overhaul during the year. As part of a range revamp strategy, Dabur has relaunched the brand Odonil with a new logo and contemporized look across various formats.

While Lavender, Citrus and Rose are the key fragrances that have a national appeal in the home air freshener category, the recent years have seen the younger generation embracing newer exotic fragrances and floral fusion (a mixture of scents). To cater to this emerging need, Dabur launched a Floral Bliss variant, which is a complex floral fragrance, and a Daffodil variant under the Odonil brand.

The formulation for its aerosol format was also changed from the existing wet/water-based formulation to a dry formulation.

Key Highlights for FY 2019-20:

The Odonil franchise saw a design reboot during the year with a homogenized look across all formats

Riding on the new launches and continued promotions on Digital media to target millennials, Odonil reported a strong gain in market share and emerged as the No. 2 player in the aerosol category.

Odonil Zipper continued to surge ahead of the category, growing by over double the category growth rates.

The year saw the launch of Odonil Smiley, the countrys first fragrance card. The product was well received.

Odonil won a Silver medal in ‘Household Supplies and Services category for its Zipper campaign - ‘How Odonil found its way back into bathroom. The Effies award was given for the new format of bathroom fragrance, which also turned the Bathroom time into a ‘Me Time.

Odomos: Dabur operates in the mosquito repellent category with the brand Odomos, a clinically proven mosquito repellent that offers the most effective protection from disease carrying mosquitoes. It is available in various forms like cream, lotion, gel, spray and fabric roll-on. The year saw Dabur undertake a packaging revamp for Odomos, which included a logo change by incorporating a protective shield around the letter ‘O to signify the better protection that Odomos offers against mosquitoes carrying deadly diseases like Dengue, Chikungunya, Malaria, Filaria and Encephalitis etc.

The brand rolled out initiatives to drive awareness about mosquito protection outside home with its tagline ‘Odomos nahi pehna to ghar pe rehna. Special digital campaigns were also launched to promote Odomos Spray this year.

Key Highlights for FY 2019-20:

In a major initiative launched in schools this year, the brand appointed Odomos Captains in classes to spread the message about prevention of mosquito-borne diseases. Children were educated about stagnant water being a breeding ground for mosquitoes and the steps they can take to prevent mosquito breeding in their schools and neighborhood.

A digital communication ‘Kids Vs Mosquito Rap Battle was launched by Odomos to promote Odomos spray. We used the rap battle music format to appeal to the brands target group. This enabled us to put forth the message of ‘Odomos nahi pehna to ghar pe rehna in an entertaining way. The film garnered 10 million views on digital media. Extending this campaign further, the brand reached out to kids on Instagram and asked them to shoot their own videos with the Odomos Rap.

A mega ‘Making India Dengue Free campaign was rolled out, under which Odomos reached out to over 10 lakh people across the country, educating them about prevention from mosquito bites and distributing free samples of Odomos mosquito repellant creams to protect themselves from dengue-causing mosquitoes during the Monsoon season.

Odomos won two Effies bronze awards in ‘Integrated advertising Campaign and ‘Products categories for its ‘Odomos nahi pehna to ghar pe rehna campaign for making Odomos an essential part of school uniform that in-turn initiated a behavior change in the mosquito repellent category.

Sanifresh: Dabur markets toilet cleaning products under the brand Sanifresh. The company launched a 150ml pack of the brand targeting rural markets. This Rs 20 pack, which will last for over a month in single toilet households, is being marketed as value pack in rural India where demand for branded toilet cleaning products is on the rise in the wake of the governments Swachh Bharat Mission.

The brand has joined hands with Ghaziabad Nagar Nigam for the Swacchta Sarvekshan under the Swachh Bharat Mission. As part of this programme, the brand has adopted Sulabh public toilets in Ghaziabad and is helping the government in regular maintenance of these toilets.

Home Hygiene Products: Healthy lifestyle habits are becoming a normal way of life in India now with consumers now cleaning and disinfecting high-contact surfaces inside their homes regularly to lower the risk of infection. This increasing awareness about hygiene and change in lifestyle is likely to positively impact the growth of the market in the years to come.

Key Highlights for FY 2019-20:

Dabur entered this market with the launch of Air Sanitisers under the Odonil and Dabur Sanitize brands. Dabur pioneered the air sanitizer category in India with the launch of an air freshener with air sanitisation benefits to fight air-borne germs.

Dabur also entered the all-surface disinfectant spray market with the launch of a MultiSurface Sanitiser under the Dabur Sanitize and Dazzl brands.

Another new launch in the category was the multipurpose Surface Cleaner liquid with germ-kill properties under the Dazzl brand.

A floor cleaner that kills germs and viruses was introduced under the Dabur Sanitize and Dazzl brands. This product, with a unique Dirt Trap technology is available in four SKUS.

Dabur launched a Glass Cleaner with germ kill benefit under the Dazzl brand.

Sanifresh Toilet Seat Sanitizer has been launched in a dry formulation with a soothing fragrance.

Dabur expanded the Odopic dish wash brand with the launch of Odopic Utensil Cleaner Liquid with Germ Kill properties.

Foods

Daburs Foods business contributed 15.9% to Consumer Care sales in India. Dabur operates in this category with packaged Fruit Juices under Real and Real Activ brands, and Culinary Pastes and sauces under the Hommade brand. Although there was some pressure in Juice & Nectar category due to consumers shifting to lower-priced products, the company mitigated the pressure by launching a range of new products at attractive price points.

Real and Real Activ: Dabur had pioneered the packaged juices market in India over 23 years back with the launch of brand Real. Over the years, Dabur has expanded this category with the launch of flavours and variants, including Indias first fruit-veggie mix juices and juices with added fruit fiber. Dabur today has the largest range of packaged fruit juices in India with a range of more than 30 under the brands Real and Real Activ. In addition, Dabur has also introduced range of wellness juices under the brand Real Wellnezz, besides tender Coconut Water under Real Activ.

Despite the decline in the Juices & Nectar category, Dabur reported strong market share gains with the company capturing an all-time high market share of 61.5% in 2019-20.

During the year, Dabur continued to launch new variants of juices, including low-priced SKUS, and drive greater connect with consumer through the digital media for both packaged juices and culinary products.

Key Highlights for FY 2019-20:

Dabur introduced a Rs 10 pack of fruit beverage under the Real Koolerz brand to tap the growing demand for low-priced products in the market. The introduction of this pack is helping capture the opportunity to expand the reach and distribution of our beverage products.

Expanded the Real Masala range with the introduction of Mixed Fruit and Aam Panna variants.

Real Fruit ORS was rolled out nationally

Dabur signed stars Dia Mirza and Kriti Sanon as the new face for Real and Real Activ brands respectively. Special campaigns were launched with these celebrities to promote in-home consumption and Diwali Gift packs, which helped improve our Brand Health scores.

Special campaigns were also launched to highlight the Vitamin C content in specific fruit juices e.g. Pomegranate to promote their Immunity building properties in the wake of the COVID outbreak.

Launched Amla Juice and Giloy-Neem-Tulsi Juice for Immunity to cater to growing need for immunity building products

Hommade Culinary Pastes & Purees: Dabur Hommades range includes culinary pastes like Ginger paste, Garlic paste, Ginger-Garlic paste and Tamarind paste, besides Tomato Puree, Lemoneez lime juice, Coconut Milk and Capsico chilli sauce. During the year, Dabur increased its digital footprint in the Foods category, particularly for Culinary pastes, to better reach out to younger consumers.

Key Highlights for FY 2019-20:

Leveraged digital as a medium to target specific consumers group, particularly the young and working couples, who were seeking convenience in their daily cooking. Joined hands with 7 key influencers and celebrity chefs to launch recipe videos on digital and social media using various Hommade pastes. The campaigns together garnered over 60 million views.

Similar campaigns were launched during the COVID lockdown period when consumers were seeking fresh and convenient recipes online.

International Business

The International Business contributed 28.2% to our Consolidated Revenues during 2019-20. Dabur today has a significant international footprint with manufacturing presence across eight countries and brand presence in over 100 countries across the globe.

The International Business covers Daburs operations across Middle East, Africa, South Asia, USA and Europe. International Business registered a growth of 4.9% during FY 2019-20. Fig 5 presents the region-wise split of Daburs International Business Revenue.

Middle East

The MENA region is the largest contributor comprising 28.3% of Daburs International Business. Over the years, the business has been built organically with Hair care and Oral Care emerging as key growth drivers. Skin Care is another key segment and we have also seeded Health Care and Foods categories.

During the year, the Company faced severe headwinds, particularly in the GCC markets on account of macroeconomic slowdown driven by declining oil prices, which impacted category growths. The Company took steps to mitigate the headwinds by improving the marketing mix and enhancing the value proposition to consumers, besides increasing spends on traditional media, digital and onground activations. This helped us improve market shares in most categories within Hair Care, Oral Care and Skin Care.

Hair Care: The Hair Care business in the International markets comprises Hair Oils, Shampoos, post-wash conditioners, Hair Creams, Hair Gels and Serums.

In the Hair Oil category, Dabur maintained its dominant position and continued to strengthen its nourishment proposition with existing consumers and recruiting new consumers through the new Dabur Amla Hair Oil communication ‘As strong as Mothers love and Vatika Hair Oils OTM (Oil-Telling Machine) activation.

• The Dabur Amla campaign celebrated consumers decades old trust in the brand by featuring three generations of bonding between mothers and daughters through oiling. The communication, emphasized on oiling as an important aspect of hair care regimen to maintain long, strong and beautiful hair.

• I nspired by Arab oiling habits, Vatika rolled out the

first-ever OTM campaign, that enabled Arab consumers to create their own signature hair oil mix. The idea was based on an insight from Arab women who like to mix different oil ingredients to create their own special concoction. Vatika offered them an experience to customize their signature Hair Oil from natural ingredients like Cactus, Almond, Black Seed & Argan. The activation, combined with a pan-Arab Media driving Vatikas natural oil equity, led to market share gains.

Dabur also entered the niche but fast-growing Organic Coconut Oil category with the launch of USDA Organic certified Dabur Virgin Coconut Oil and maintained its leadership position in the Hair Oil category with 70% market share in KSA and 42% in UAE.

Recently, the company has launched Dabur Amla Hair Repair Solutions comprising Hair Growth Oil which helps in 3x improvement in hair growth rate and Hair Fall Control Oil which leads to 50% improvement in Hair Root Strength.

The companys move to extend the Dabur Amla Kids range to a younger TG continues to elicit positive response. Its strategic tie up with Disney saw the launch of limited-edition packs of Dabur Amla Kids and Frozen-II, which were highly popular with consumers. Dabur Amla Arabia channel on YouTube saw its subscriber base increase to 276,000 with 244 million views to date. The brand also received the Silver Award from YouTube.

Vatika Shampoo launched ‘Farasha, a web-series that connects with young Arab women on addressing new societal challenges through slice of life capsules inside a hair salon. The activation, combined with pan-Arab TV Media support and enhanced value proposition for consumers, led to market share gains in Saudi Arabia and UAE. With the onset of COVID-19, the brand has recalibrated its response by focussing on In-Moment videos and increasing presence on Digital and E-Commerce.

An innovative Selfie Mirror activation was implemented for Vatika Hammam Zait where consumers would share their hair problems and the Mirror would suggest the most suitable Hammam Zait pack for their specific problems. The activation was combined with an influencer campaign where we tied up with local Arab Influencers to educate on "How to Use Hamam Zait". These activities not only led to strong market share gains, but also helped the brand achieve leadership position in Saudi and maintain its leadership in UAE.

Through the Vatika Gel Extreme Challenges, Vatika hair Gel successfully communicated its strong hold properties to gel users. For the Sky Dive challenge, Vatika roped in a popular influencer in the region who jumps off the plane at 13,000 feet with wind speed of 270 KMPH. The Vatika styling gel hold was impeccable after the jump and proved that Vatika Hair Gel delivers on its promise. A Wing Walking challenge was also undertaken with a person standing on top of the plane with wind speeds going up to 300 KMPH. With this activation, Vatika became the only brand to deploy Wing Walking to demonstrate product superiority. These videos became big viral sensations, garnering over 18 million views, over 21 million impressions and over 300,000 actions in terms of Likes, Comments and Shares.

Vatika Hair Cream continued to maintain its leadership position in Saudi Arabia and UAE despite intense competitive pressures. Vatika Naturals Hair Food was launched in the GCC markets, the first Hair Food with 100% natural oils for women with extremely dry and damaged hair.

Oral Care: Dabur has a wide portfolio of herbal dental care under the brand Dabur Herbal Toothpaste. The portfolio achieved strong market share gains in the highly competitive Toothpaste category, largely driven by the #StrongTeethStrongAmbitions campaign which celebrated human spirit for space exploration and coincided with the 50th year of Man landing on Moon and the UAEs pioneering space program. The campaign was in-line with being a purpose driven brand which encourages youngsters to achieve their ambitions. The 360 degree campaign comprised disruptive in-store visibility with a 15-foot rocket in major Hypermarkets; strong support on pan-Arab and Asian media; On-pack promotion whereby winners got a chance to visit the Space Centre in USA; and amplification on Social Media through leading influencers in the region delivering 15 million impressions. This highly successful campaign is also a finalist at the prestigious Beautyworld Middle East Awards.

Towards the end of the year, Dabur Herbl Alpha Range was launched, which has elicited positive initial consumer response. The range comprises Activated Charcoal Toothpaste for Expert Whitening, Aloe Vera Gel Toothpaste, Olive Toothpaste for Expert Enamel Care and Blackseed Toothpaste.

Skin Care: Our flagship Skin Care brand DermoViva extended into the Hand Sanitizers category in the wake of the urgent need gap that emerged due to COVID-19. DermoViva AntiBacterial Hand Sanitizers were launched in two variants, Aloe Vera and Olive, providing the added benefits of natural ingredients to the otherwise only alcohol-based hand sanitization. Along with the range of sanitisers, the company has also launched sanitizing spray, santizing wipes and antibacterial soap.

In the Depilatory category, Fem tied with local female comedian and influencer Maya Acra to launch a series of videos to create conversations and bring lightheartedness to an otherwise serious category. The videos cumulatively garnered 11 million views. The market share of FEM in chemical depilatories in UAE also reported an increase.

Vatika was extended to the skin care category with the launch of Vatika Sanitizing Body Wash in two variants - Pine Oil & Olive and Tea Tree & Lemon Oil.

Foods: With its Real brand, Dabur continued to work towards expanding its geographic presence in Packaged Juices & Nectar category. During the year, the Real was expanded to 14 countries, up from 4 in the previous year.

Africa

Contribution of African region to Daburs International Business has steadily grown to reach 23.2%, with Egypt, Nigeria, South Africa and Kenya being the key markets. During the year, the business in African markets delivered good growth. The Company was able to generate trials, improve saliency and consumer franchise across West Africa, East Africa and Southern African economic zones on account of stable supply of African Hair products, under the brand ORS. This product range is being manufactured at Daburs manufacturing facilities in the region.

Nigeria: Daburs Nigeria business covers Hair Care, Oral Care and Home Care products. A deep focus on market level visibility and grassroot activations helped Dabur mitigate the severe economic headwinds to report growth and maintain market share in the highly competitive toothpaste category. Dabur consolidated its multiple hub-and-spoke model under a national distribution arrangement, which has given us access to wide spectrum of sub-distributor network and shared direct-to-retail structure in top cities across Nigeria.

The year saw Dabur introduce Low Unit Price (LUP) sachet packs of pre-measured, no-Lye Relaxer, which helped our ORS business attain a leadership position in the market. We also developed an engaging stylist-hair association program, which became extremely relevant during the economically tough times. The business launched a range of new products like Hair Texturizers, Hair Mayonnaise, Salon specific multipacks and Sanitizers.

South Africa: Following the acquisition of the Long & Lasting business based in South Africa, its manufacturing operations have been fully integrated with Daburs in-house unit in Johannesburg. The portfolio has been extended into other SADC (South African Development Community) and COMESA (Common Market for Eastern and Southern Africa) markets like Tanzania, Zambia, Uganda and Ethiopia. Long & Lasting Naturals range has also been selectively launched through retail channels in South Africa.

Besides the core brand ORS, the added focus of the business was to tap into naturals styling amongst African women. To enable easy maintenance regimen, the Company has introduced two new offerings - Olive Oil Black Castor and Vatika Afro Naturals range. In addition, new markets within SADC construct have been added to the sales sourcing matrix.

Dabur now aims to further expand the product base in the region by introducing a range of products like mosquito repellents, hair oils, shampoo, conditioners, hand and body wash and toilet cleaners.

During the year, Dabur collaborated with National and Regional Hair Associations to drive saliency for its products across markets like Nigeria, Ghana, Ethiopia, Kenya, Tanzania, Zambia, Uganda and South Africa. These local insight-driven initiatives, leveraged with vernacular media, are expected to enhance business growth and expand our foothold across various markets in Sub-Saharan Africa.

Egypt: The year 2019-20 proved to be challenging in terms of the overall business environment. Demand remained stressed due to low purchasing power on account of higher consumer inflation. Despite the overall macro-economic headwinds, Daburs Egypt business posted strong growth during the year.

In order to capture the consumer demand under the circumstances, targeted consumer promotions were given on Hair Oil, Hair Cream and Shampoo brands. The strategy bore results as Dabur inched up its market share across all key categories with all its leading brands witnessing good growth. Dabur consolidated its Hair Oils market volume share to touch a new high of 77.5% with strong growth in Vatika and Dabur Amla Hair Oil brands. Daburs volume market share in the hair creams increased, riding on strong growth of its flagship brand Vatika. Vatika Hammam Zait

also witnessed strong double-digit growth during the year to corner almost two-third of the market share and emerged as the single largest brand in the category. Vatika Shampoo posted strong double-digit growth in a highly competitive market, while Dabur further strengthened its foothold in the Oral Care category to be ranked the Number 4 toothpaste brand in the market.

South Asia

The South Asia business for Dabur covers key markets like Nepal, Bangladesh, Sri Lanka, Pakistan and Myanmar. This region accounts for 22.6% of total International business for Dabur.

Nepal: Dabur has a diversified portfolio in Nepal and is present across Juices, Health Supplements, Digestives, Hair Care, Oral Care, Home Care, Skin Care & Consumer Healthcare categories. In FY 2019-20, the Business was under stress largely on account of two major disruptions- Implementation of VCTS by the Government of Nepal in Q2 & CoVid-19 in Q4. The company however continued to gain market share in the highly salient and tracked categories. The company introduced new variants in its beverage portfolio to meet the evolving consumer tastes. The company launched Dabur Chatcola and Prostyle Cooling Hair Oil. It started local manufacturing of popular brands like Meswak Toothpaste & Honitus Cough Drops. The company continues to drive distribution expansion in rural across Nepal along with a special focus towards the emerging urban channels like Modern Trade & E-commerce.

Bangladesh: Daburs Bangladesh business manufactures and markets wide range of consumer goods under segments like personal care, food, home care etc. with products like Tooth Paste, Hair Oil, shampoo, Digestive Tablets, Honey, etc. In FY 2019-20 Segments like Tooth paste, shampoo, homecare saw good growth. However due to Covid-19 the business came under pressure towards end of the year. The Company has plans to introduce new products in all categories and expand its rural reach.

Myanmar: In Myanmar the core portfolio of the company consists of oral care, skin care and home care. The business was on a high growth trajectory till Q3, however the Q4 performance was impacted on account of Covid 19. The company focussed on driving its business through range expansion and increasing distribution reach. Distribution expansion was carried out in the hinterland across both Upper & Lower Myanmar.

Europe

The European region contributed to 12.3% of International sales for Dabur. Turkey and UK are the two biggest markets for Dabur in this region.

Turkey: Daburs business in Turkey registered a strong top line growth of 43.4% in constant currency terms.

Turkey continued to face economic headwinds in FY 201920. The consumer confidence index was at a 10-year low and was trending at 54.9 in April 2020. This was compounded with high inflation (11%+ inflation rate), increasing unemployment (13%+ unemployment rate), liquidity issues due to high interest rates and decline in relevant FMCG categories.

Although these challenges remained in Turkey, Hobi Kozmetiks, Daburs subsidiary in Turkey, stood the test with the help of consumer-focussed marketing initiatives and relaunched its Hobby Shampoos and Hair Styling range in the market. Hobi was also able to increase the listing of Shampoos and Hair Waxes to National Chains. During the period Hobby Shampoo market share increased from 1.5% to 2.7% and Hair Styling Share increased from 18% to 19%. In addition to consumer brands, Hobi also has a private lable business which was expanded with addition of new domestic as well as export customers.

America

In USA, Dabur operates in two broad segments, viz., Namaste business and the Indian Ethnic Business. The Namaste business caters to hair care needs of the African American community and is a leader in the relaxers and hairdress category. Although the overall relaxers category showed a decline, the market share of the Company rose to 29.7% from 27.5% on account of Companys consistent distribution focus on the value priced new growth kit. In the naturals segment, the Companys brand Curls Unleashed continued to perform well and entered the emerging temporary hair colour segment under the sub-brand ColorBlast. The company became the first major manufacturer to enter this emerging segment. We also received positive response from consumers for the newly launched Fix IT wig and weave collection. Here again, the company is one of early entrants in a segment that is projected to grow significantly.

Overall, the Namaste business reported considerable improvement in topline and bottomline, led by its increased sales of styling and new products and the realized cost efficiencies.

Sales & Distribution - India

Despite the economic headwinds and liquidity crunch in the marketplace, Dabur has been aggressively investing ahead of the curve to ramp up its distribution infrastructure, covering both urban and rural India. The year saw Dabur move ahead full steam on its plans to expand its rural footprint by enhancing its village network and creating special products to ride this network expansion. On the other hand, significant investments were made to drive up its direct reach in retail outlets, besides enhancing coverage of Chemist outlets. This distribution enhancement exercise helped Dabur during the COVID-imposed lockdown.

As part of this strategy, we have increased our village network to cover 52,298 villages, up from 44,068 villages in March 2019. This helped us drive our rural business strongly and mitigate the impact of the economic slowdown through most part of the year. This expansion also held good during the COVID-imposed lockdown as demand continued to pour in from rural India, making up for some of the losses from urban markets, where the lockdown was more severe.

We have increased our direct reach to 1.2 million outlets by the end of the 2019-20 financial year, adding 113,989 new outlets during the year.

In the urban markets, Dabur has been working towards driving growth with a special focus on emerging channels like e-commerce, Modern Trade and Cash & Carry, as these channels have shown signs of resilience during the slowdown. Modern Trade and e-commerce had been growing at a faster pace with urban and millennial consumers gravitating towards more premium offerings. To cater to this demand, we created special products for the e-commerce marketplace, which are more premium in nature. The first of the new e-commerce specific range was our Dabur Amla Kids Hair Care range. We have also been investing in higher consumer activations and promotion in Modern Trade outlets to drive demand.

The lockdown imposed post Covid brought the entire Sales system to a grinding halt in the initial days with movement restricted and consumers shying away from stepping outside their homes. The traditional Kirana stores became the preferred go-to point for consumers for their daily grocery needs during the lockdown. As they remained open during the lockdown period, these neighborhood Kirana stores gained prominence in the minds of consumers and emerged as the preferred contact point for consumers to fulfil their needs for daily essentials.

Dabur also deepened its engagement with these outlets in several ways. Dabur has joined forces with 11 other like- minded FMCG companies in India to support the Government in providing Indians a safe shopping experience in the wake of the COVID-19 outbreak. Under this joint initiative, called Suraksha Stores, we are working towards converting the neighborhood Kirana stores into sanitised retail outlets selling daily essentials, while adhering to safety norms such as social distancing and sanitisation. This would go a long way in controlling the spread of COVID-19 in India. The retail outlets have been mapped and linked to the Governments newly created mobile application, Aarogya Setu. Under this program, we have reached out to retail stores across India, enrolled them under the program and provided online training on safe hygiene practices. In the second phase, we are supporting these outlets by providing them sanitsation kits which would be put outside the stores to be used by consumers. The staff at these stores are also being provided face masks, gloves and hand sanitisers for personal protection. In addition, these outlets are being trained to ensure that they maintain social distancing within and outside their outlets and display posters related to safe practices. This initiative is also being extended to cover the entire Supply Chain. Called Suraksha Circle, this would involve educating the Supply Chain partners and enabling them with the right tools to create a safe environment for all.

The initial days of the lockdown saw the distribution supply chain come to a grinding halt with most stockists and distributor downing shutters. We worked closely with the stockist partners to help them restart their businesses and even started supplying products to their homes. We also established direct connect with retail partners to ensure that they do not run out of stock and uninterrupted supplies are maintained.

During these unprecedented times, Dabur developed innovative solutions and leveraged technology to ensure uninterrupted supply of our essential products to retailers. In some cases where stockists were unable to operate, we commenced direct supplies to retail outlets. We also created a special Mobile App for Retailers, through which they can place orders for Dabur products. These orders are then serviced either directly through our salesforce or through nearby stockists. Around 40,000 retail outlets were enrolled on the App. other unique interventions include initiating retailer order-booking through WhatsApp wherein a dedicated WhatsApp number was shared with retailers on which orders can be sent as a text message. Further, we activated our Call Centre to receive orders directly from retailers, besides booking orders through tele-calling.

With the parlor channel being closed in view of the lockdown and social distancing guidelines issued by the government, we realigned our entire Parlor sales force to the service the General Trade and neighbourhood Kirana stores. With stockists unable to send vehicles due to the lockdown, we deployed third party delivery vehicles to send supplies. In some cases, our Salesforce even carried supplies in their personal vehicles to retail outlets and stockiest points.

As the lockdown intensified and disrupted the traditional Supply Chain network, we forged new linkages with food aggregators, online delivery service providers, hyperlocal apps and even newspaper vendors to ensure timely supplies of our products to retail shelves. We tied up with logistics firms Delhivery and Javis, besides engaging with Online Delivery Service Providers like Dunzo, and food aggregators like Swiggy and Zomato to deliver products to retail outlets and consumers. With newspaper services also disrupted, we engaged the newspaper hawkers across several cities to ensure timely delivery of products to Retail outlets early in the morning in order to meet the new curfew timings in these cities.

With the consumer need and enquiries for immunityboosting products and Ayurvedic medicines growing in the wake of the COVID outbreak, Dabur worked with retail outlets and Modern Trade stores to create special Immunity corners within these shops. Under our ‘Immunity in Shop program, we enhanced in-shop display and promotion of the Dabur Immunity Booster range. Special branded Immunity Vans were also deployed to showcase the range and generate sales. The Dabur Immunity booster products range was also placed in Dairy & Kirana Stores.

With the extended lockdown forcing many consumers to be home-bound, we also commenced a direct outreach program to reach consumer households with our range of Immunity booster products, hygiene products and daily essentials like fruit juices etc. Under this ‘Immunity at your Doorsteps program, our sales officials reached out to Resident Welfare Associations (RWAs) across the country and set up small sales counters in their locality or within housing societies, while strictly following the norms of social distancing and personal protection, to give households access to our range of immunity boosters like Dabur Chyawanprash, Giloy tablets, Giloy Churna and Immunity Kit. Similar initiatives were undertaken at community parks and petrol stations to directly reach out to consumers.

In some cases where consumers reached out to us on Social Media expressing their inability to move out of their houses during the lockdown to buy Ayurvedic medicines, our frontline salesforce went the extra mile and got the products delivered at their doorsteps.

Dabur also worked with B2C e-commerce chains by leveraging the ‘essentials portfolio. Special banners were created for digital media to spread awareness about the essential products in Dabur basket, including the range of immunity building products and hygiene products.

The E-commerce channel, which has been scaling up well for the Company, now contributed 2.4% to Sales as compared to 1.4% a year ago. This channel has been experiencing the fastest growth through most part of the year. While the channel faced some difficulties during the initial days of the lockdown, it bounced back soon and became the first channel for rolling out new products. Brands covering all categories like Health Supplements, Packaged Juices, Hair Oils, Oral care and Home Care, saw good traction on e-commerce platforms. Another first this year was the introduction of an e-commerce exclusive product range with the launch of Dabur Amla Kids Hair Care range. Going forward, we are now creating special SKUs and packs only for e-commerce platforms.

Dabur also continued to focus on IT-enablement as a major driver of enhancing productivity and field force efficiency. As part of this strategy, we undertook a major revamp of our Distributor Management System (DMS), besides moving forward with the Sales Force Automation program and better use of analytics and information in managing sales.

As part of the RISE initiative, we are now identifying regional opportunities to scale up distribution network and increase the reach of specific brands in their core markets. The regional insights from our sales teams are also being used to develop new products tailored for specific markets.

Digital Marketing & Media Strategy

With a growing number of consumers, particularly millennials and centennials, spending longer periods of time on their mobile screens and laptops, the media landscape in India is undergoing a major shift. There are also a growing number of consumers who now prefer to shop online for FMCG products.

According to recent research by Kantar IMRB, Indias Internet users have reached about 627 million. Of this, 293 million active users reside in urban India and 200 million active users in rural India. The rural internet users are growing at a rate of 35% annually as against an urban user growth of 7%.

At Dabur, we have strengthened our Digital Marketing initiatives and have put in place annual partnerships and sponsorships with digital platforms to improve our brand presence. Special tie-ups are also being put in place with digital platforms and e-commerce chains to create virtual shelf display of Dabur products. This initiative, in fact, gained momentum during the COVID lockdown period, helping us better reach out to the specific target audience and improve top-of-mind awareness and recall by positioning your products contextually. Special Immunity and Hygiene counters were created on online platforms.

Our spends on digital and e-commerce have grown exponentially in the past year with brands creating special digital-only content. With videos emerging as one of the most consumed forms of content, we have been investing behind

creating differentiated and disruptive campaigns across brands. Some of the most popular and widely shared videos created especially for digital media in 2019-20 include the PudinHara Nauchandi Mela video with an earthy catchy song #PudinHaraBanke; the #ChabaateyRahoIndia campaign by Dabur Red Paste and The Odomos #MosquitoRap song featuring kids. These special digital creatives helped us drive conversation among our consumers, build strong communities and develop a loyal consumer base.

We also effectively used Moment Marketing to drive relevance and conversation around our brands. Memes and special posts were developed around current new developments and public events to build a greater connect with the digitally savvy consumers. With News emerging as the most watched segment across media in the wake of the COVID outbreak, Dabur increased its brand presence on digital News channels and websites with specially created Banner ads and Contextual ads around specific brands like Dabur Chyawanprash, Dabur ImuDab, Dabur Giloy tablets, Real juices and Dabur Red Paste.

Digital media was also used to support brands like Dabur ImuDab immunity building syrup and Giloy ki Ghanvati tablets that are not heavily advertised on mainstream media. This strategy has helped improve visibility for these brands, particularly during the lockdown.

Influencer marketing is another key pillar of our digital strategy. Dabur has been effectively using influencers and celebrities to tap into their huge follower base and increase consumer awareness about our products. Dabur Honey rolled out a #StayFitFromHome campaign on social media, which saw its brand ambassador Jacqueline Fernandes posting about her fitness regime. Other brands in the Dabur portfolio like Vatika enriched Coconut Oil, OxyLife Bleach, Fem Bleach, Real Activ 100% Juice and Dabur Hommade too increased engagement with consumers on Social Media through Contests and Celebrity-led content on Instagram and YouTube.

Dabur Amla Hair Oil created a series of digital campaigns, especially during the lockdown period to build greater connect with consumer. Dabur Amla What Women Want show with Kareena Kapoor on you tube entered its second year and received a phenomenal response.

Retail Business - NewU

Dabur operates in the specialized beauty retail business with its wholly owned subsidiary, H&B Stores Ltd. This is a chain of beauty retail stores under the brand ‘NewU, offering a wide range of beauty care products covering cosmetics, fragrances, skin care, personal care and beauty and fashion accessories.

NewU is today amongst the largest one-stop-shop for all beauty care needs with a range of domestic and exclusive international brands available at its stores. At the end of fiscal 2019-20, NewUs retail footprint stood at 111 stores across 39 cities and has enabled E-Commerce on newu.in and increased presence on other marketplaces.

The year saw NewU enhance its portfolio of exclusive brands at its stores with the launch of various product range under the brand Jaquline USA such as Matte Lipstick, Eye Shadow, Makeup remover, Liquid Eyeliner, Nail Polish remover etc. Going forward, the company plans to expand the Jaquline USA range to cover a host of beauty, make-up & skin care categories. The company is also planning to introduce other brands in Hygiene, Personal Care, Skin care and Fragrance.

Operations

Dabur products touch millions of lives. Our products are tailored to meet the diverse needs and aspirations of our consumers across the globe. We put a lot of emphasis on enhancing our manufacturing capability to ensure that our Supply Chain conforms to the highest standards of quality. Our manufacturing footprint today covers four continents.

Domestic Manufacturing

Daburs manufacturing operations cover 12 locations in India: Baddi (Himachal Pradesh), Pantnagar (Uttarakhand), Sahibabad (Uttar Pradesh), Tezpur (Assam), Jammu (Jammu & Kashmir), Katni, Pithampur (both in Madhya Pradesh), Silvassa (Gujarat), Narendrapur (West Bengal), Nashik (Maharashtra), Alwar and Newai (both in Rajasthan). More details on our manufacturing operations are presented in Manufactured Capital section of the Annual Report.

overseas Manufacturing

Dabur has been following localized supply Chain policy in the overseas markets, having established manufacturing bases across the globe to develop and manufacture a range of products catering to the tastes and needs of the local populace. Our overseas manufacturing facilities are located in UAE, Nigeria, Egypt, Turkey, South Africa, Nepal, Bangladesh, Sri Lanka and Pakistan.

uAE: In UAE, Dabur manufacturing unit is located in Ras Al Khaimah (RAK). The unit produces a wide range of hair care, oral care and skin care products. With a capacity of over 57,000 MT / 9 million cases of finished goods annually, the RAK unit caters to more than 70 countries. Aligned to the latest trends, RAK unit has taken the first step towards creating a digital "Industry 4.0" factory, by implementing "Manufacturing Execution System (MES)". This is in line with Daburs vision of creating smarter and leaner operations. During the year, the plant continued its Kaizens for automation, energy savings and cycle time optimization.

Turkey: Hobi Kozmetik factory, located near Istanbul, is a manufacturing source for Turkey as well as exports to Africa, Middle East and USA. Manufacturing capacity is 55,000 MT per annum of liquid soaps, shampoos, conditioners, hair care and skin care products. During the year factory continued investments on modernization and automation of production lines to improve productivity, GMP and safety. Besides ISO 9001(QMS), ISO 22716(GMP) and ISO 45001(OH&S), this year the factory obtained ISO 14001(EMS) certification also.

Egypt: The manufacturing facility is located at Cairo, where it produces hair oils, styling creams, hair gels, shampoo & conditioners, henna hair colors, hair removing creams, toothpastes & ORS Kits. The plant annual capacity increased from 25,000MT to 27,000MT through investment in Tooth paste and Hammam cream manufacturing capacity. Using LEAN, TPM & CFT initiatives plant has optimized Cycle times, improved utilization and reduced wastages. Exports to COMESA and neighborhood markets of MENA such as Palestine, Lebanon, Libya, Jordan, grew in double digits.

Mgeria: Dabur Nigeria factory, located at Lagos, is engaged in manufacturing of Oral and personal care products like toothpaste, hair cream, shampoo/conditioner, hair gels/ foods, hand sanitizers and Home care products. Hair care category manufacturing enhanced by batch size increase, reduced wastages and increased OEE through kaizens & TPM initiatives. Various new products added including ORS Texturizer and Hair Mayonnaise.

nepal

Dabur, in Nepal has a manufacturing plant at Birganj. The plant manufactures products in various segments such as fruit juices, hair care, oral care and skin care.

Bangladesh

The manufacturing facility is located at Dhamrai in Bangladesh. The products manufactured here includes hair care, oral care, digestives and honey.

Sri Lanka

Daburs manufacturing plant in Sri Lanka is located at Kotedeniya. The plant manufactures fruit juices.

South Africa:

In South Africa, Daburs manufacturing plant is located in Johannesburg. The Plant produces Relaxer Kits, Lotions,

Shampoos, Conditioners and a variety of styling products. Annual production is over 900 MT / 265,000 cases. Various initiatives for batch cycle time reduction, packing capacity enhancement, and procurement of automated machines helped in Productivity increase and cost control. Major Safety improvement projects were also executed during the year.

Human Resource

Dabur, from its formative years, has recognized the importance of Human Capital to the success of its business. Our founders vision of ‘Health and Well-Being for every household furthers this thought, which today reflects in our work culture and people strategy. While we continue to explore new horizons and meet increasingly competitive milestones in our growth journey, the real enabler is our increasingly young, vibrant, multi-cultural and diverse employee base.

Today, Daburs globally dispersed workforce helps bring the world of Health and Well-Being closer to our consumers through a plethora of relevant product offerings. The Organization, on its part, latish ensures that our employees stay passionate to our Vision and Values, well equipped with relevant knowledge to cope with the business challenges and remain motivated to achieve tougher targets in a competitive landscape. More details of the initiatives on HR are provided in Human Capital section of the Annual Report.

Financial Review

During fiscal 2019-20, the company recorded Consolidated Revenue from Operations of Rs 8,703.6 crore, compared to Rs 8.533.1 crore in fiscal 2018-19. In the nine months ended 31st December 2019, the growth in consolidated revenue from operations was 6.8%. The business was impacted in the last quarter of the year due to Covid-19 and the consequent lockdown which led to significant loss of sales in the second half of March ‘20.

Material cost in fiscal 2019-20 decreased by 40 bps primarily on account of material deflation. The advertisement and publicity expenditure for the year stood at 7.5% as against 7.1% in the previous year. Employee cost was steady at 10.9% of revenue from operations. Other expenses were also steady at 11.0% of revenue from operations.

The companys operating profit grew by 3.0% to reach Rs 1,792.4 crore. The operating margins continue to remain healthy at 20.6% as against 20.4% in the previous year. Profit After Tax (PAT) was Rs 1,445 crore in fiscal 2019-20. Excluding the exceptional items in fiscal 2019-20 and fiscal

2018- 19, growth in PAT was 5.8%. Diluted EPS for fiscal

2019- 20 was at Rs 8.15. Table 1 provides a summary of the consolidated income statement.

Table 1: Consolidated Income Statement Summary

All figures are in crores, unless otherwise stated FY2019-20 FY2018-19 Growth % (Y-o-Y)
Net Sales 8,622.9 8,437.3 2.2%
Other Operating Income* 80.7 95.8 (15.7%)
Revenue from operations 8,703.6 8,533.1 2.0%
Material Cost 4,360.2 4,309.0 1.2%
% of Revenue from Operations 50.1% 50.5%
Employee expense 947.7 937.9 1.0%
% of Revenue from Operations 10.9% 11.0%
Advertisement and publicity 650.0 608.3 6.8%
% of Revenue from Operations 7.5% 7.1%
Other Expenses 953.2 938.2 1.6%
% of Revenue from Operations 11.0% 11.0%
Operating Profit 1,792.4 1,739.6 3.0%
% of Revenue from Operations 20.6% 20.4%
Other Non-Operating Income 305.2 296.2 3.1%
EBITDA 2,097.6 2,035.8 3.0%
% of Revenue from Operations 24.1% 23.9%
Finance Costs 49.5 59.6 (16.8%)
Depreciation & Amortization 220.5 176.9 24.6%
Profit Before Tax (PBT) 1,827.7 1,799.3 1.6%
Share of profit / (loss) of joint venture (0.0) 1.0 n.m.
Exceptional item(s) 100.0 75.3 32.7%
Tax Expenses 279.7 278.6 0.4%
Minority Interest - Profit/ (Loss) 3.0 3.9 (24.5%)
Pat (After Minority Int.) 1,445.0 1,442.4 0.2%
% of Revenue from Operations 16.6% 16.9%

‘Includes Area Based Benefit received in lieu of excise duty exemption

Table 2: Working Capital

As Days of Sales FY2019-20 FY2018-19
Inventories 57.9 55.6
Receivables 33.9 35.7
Payables 62.1 62.3
working capital 29.7 29.0

As shown in Table 2, Working capital employed in the business remained steady at 29.7 days during the year. There was a slight increase in Inventories from 55.6 days to 57.9 days and reduction in Trade Receivables from 35.7 days to 33.9 days. Trade Payables were steady at 62.1 days.

Table 3: ROIC and Return on Net Worth

As Days of Sales FY2019-20 FY2018-19
ROIC 43.5% 48.3%
Return on Net Worth 21.8% 25.5%

ROIC and Return on Net Worth decreased on account of the investment base increasing at a faster pace compared to the profits during the year.

Table 4: Cash and Debt Position

In Rs crore FY2019-20 FY2018-19
Debt 335 699
Cash & Cash Equivalents 4,137 3,752
Net Cash 3,802 3,053

The business generated Net Cash flow from Operations of Rs 1,613 crore in fiscal 2019-20. Capital Expenditure of Rs 377 crore was incurred during the year which includes the expenditure on domestic as well as overseas manufacturing facilities. The net cash available with the company as on 31st March 2020 was Rs 3,802 crore and the total debt amounted to Rs 335 crore. Table 4 reflects the cash and debt position of the company.

In fiscal 2019-20, the company declared annual dividend of Rs 3.0 per share. Total dividend payout during the year including dividend tax for the year was Rs 580.98 crore which takes the dividend payout ratio to 40.2%.

Outlook

FY 2019-20 started on a strong footing with double digit growth in the first quarter but the slowdown in key categories through the year impacted full year growths. This was further exacerbated by the lockdown imposed by the government in the second half of March 2020 to curtail the spread of Covid-19.

At this point of time, we see the FY 2020-21 revenue and profitability being impacted on account of weak first quarter due to the continued lockdowns in the first two months of the current fiscal. The company is seeing signs of recovery emerging in the month of June, but the situation is too volatile and dynamic at this point of time to be able to extrapolate the full year.

The outlook for inflation is benign and the company aims to reinvest any savings in gross margin behind brand building initiatives.

Internal Control Systems and Their Adequacy

Please refer to the Directors Report.

Risks & Concerns

Please refer to the Risk Management section of the Integrated Report for more details.

Strategy & Resource Allocation

Please refer to Daburs Strategy section of the Integrated Report for more details.

Stakeholder Relationships

Details of our Stakeholder Engagement initiatives have been provided in the earlier sections of the Integrated Report.