Dabur India Ltd Management Discussions.

ECONOMIC SCENARIO

Global Economy

The year 2020-21 will forever be known as the year of COVID-19 pandemic, a health crisis which impacted the global economy heavily. The pandemic led to severe loss of lives and livelihood resulting in decline in incomes, increase in rate of unemployment, financial distress in industries which are more contact led and outdoors and increase in poverty levels across the world. As per IMF World Economic Outlook April 2021, the accumulative per capita income losses over 2020-22, compared to pre- pandemic projections, are equivalent to 20 percent of 2019 per capita GDP in emerging markets and developing economies (excluding China), while in advanced economies the losses are expected to be relatively smaller, at 11 percent. Consequent to the pandemic, the global economy contracted by 3.5% during 2020 (source: World Bank Global Economic Prospects June 2021).

The pandemic continues to impact the world and the second wave of COVID-19 has hit some of the countries like India very hard. at the same time, there is a ray of light as multiple vaccines have become available which can reduce the severity and frequency of infections. in addition, central governments have responded by providing strong fiscal stimuli and investment in healthcare infrastructure which will lead to a rebound in economic activity across regions. As per World Bank Global Economic Prospects 2021, the global economy is set to expand 5.6 percent in 2021 —its strongest post-recession pace in 80 years. This recovery is uneven and largely reflects sharp rebounds in some major economies—most notably the United States, owing to substantial fiscal support—amid highly unequal vaccine access. in many emerging market and developing economies (EMDEs), elevated COVID-19 caseloads, obstacles to vaccination, and a partial withdrawal of macroeconomic support are offsetting some of the benefits of strengthening external demand and elevated commodity prices. The global outlook remains subject to significant downside risks, which include the possibility of large COVID-19 waves in the context of new virus variants and financial stress amid high EMDE debt levels. Due to the expected rebound and low base of 2020, the global economy is projected to grow at 5.6% in 2021 and 4.3% in 2022. (Refer Fig. 1.1).

Indian Economy

Like most countries in the world, India also faced its fair share of headwinds during 2020-21. The GDP numbers plummeted in Q1 of FY2020-21 to -24.4% on account of strict lockdowns imposed by the government to curb the spread of the virus. There were mobility restrictions, disruption in sales and distribution and supply chain, reverse migration of labour force, shifts in consumer behaviour towards essential categories and severe impact on channels like modern trade, salons and HORECA.

With gradual unlocking of the economy, Q2 FY2020-21 saw sequential recovery, albeit the GDP growth rate remained in the negative on account of declines in construction activity and non-essential services like travel, entertainment, and hospitality industries.

Indian economy returned to the growth side in Q3 of FY2020-21 on account of pent-up demand, festive spending, and a jump in government expenditure. The big surprise in terms of the sectors of production was the healthy expansion in financial, real estate and professional services (+6.6%), and construction (+6.2%).

During Q4 the GDP reported growth of 1.6% and was on the path to recovery when the second wave of COVID-19 came like a bolt from the blue. This deadly wave has led to a huge humanitarian crisis in the country making India the second highest in the world in terms of number of cases and third highest in number of deaths. The lockdowns in various parts of the country during April and May have once again put a shadow on economic growth and is likely to impact the GDP growth going forward.

Outlook

While impact of the second wave of COVID-19 is coming down as this report goes into print, the future is still uncertain. As per recent estimates released by RBI, the GDP is likely to grow at 9.5% during FY2021-22. The quarter wise estimates of GDP growth are presented in Fig 1.3.

As per estimates provided by World Bank in Global Economic Prospects June 2021, the Indian economy is expected to grow by 8.3% in 2021. Compared to India, China is expected to see a growth of 8.5%, US to grow at 6.8% and Euro Area to witness 4.2% growth in the same period (Refer Fig 1.4).

INDUSTRY SCENARIO

Indian FMCG Sector

The Indian FMCG Sector is estimated to be worth USD 62 bn (Rs. 4.3 trillion) in size and is dominated by the Foods segment which contributes to 57% of the FMCG market, followed by HPC at 37% and OTC at 6%. As per A C Nielsen, the FMCG sector was flatfish in FY20-21 as against 5.5% in FY2019-20.

The drop in growth was primarily on account of the steep contraction seen in Q1 FY2020-21 due to strict lockdowns imposed by the government. in line with the decline in GDP of 24.4% in Q1, FMCG sector declined by 19.4%. While sales of FMCG products declined sharply, there was an unprecedented surge for health and hygiene products, particularly COVID contextual products like immunity boosting products, sanitizers, disinfectants, etc.

With gradual unlocking and resumption of mobility from Q2 onwards, consumers started to step out to shop which led to the growth rate coming into the positive. While demand for health and hygiene products continued to be on the higher side, the discretionary categories also saw sequential recovery. Rural areas continued to be the drivers of growth, outpacing growth in urban areas. in terms of channels, e-commerce gained saliency and the industry

saw also renewed importance of the traditional trade due ease of access and lower risk of contact led infection. While mobility returned to normal with few exceptions, like schools continued to remain shut, HORECA channel and occasion- based consumption continued to remain impacted.

Outlook

While there has been recovery in FMCG industry towards pre-COVID levels, there is still uncertainty with the new wave of COVID cases and lockdowns/curfews returning in many parts of the country. The roll out of vaccination programme augurs well for the country and the sector, but fear of the pandemic continues to exist.

Medium- and long-term prospects of Indian FMCG sector remain positive as per capita consumption in India still remains below many comparable countries. in addition, factors such as a large consuming population, increasing emergence of nuclear households, rising propensity for consumption especially among millennials and centennials, premiumization among higher income groups and changing demographics bode well for the sector. As per a report by BCG titled Retail Resurgence in India, February 2021: ‘India has been displaying steady consumption growth for several years with the expectation of consumption tripling by 2030. The growth has been driven by strong fundamentals of the country - increasing share of affluent and elite households, urbanization, nuclearization of households and increasing Gen-i population with higher appetite to spend. However, with COVID-19 hitting the country in 2020, the factors driving consumption came under pressure and the avenues for consumption growth became limited. Retail sector too saw its first contraction in 2020 post showing double digit growth over past several years. However, economic revival is on the anvil now. The signs of recovery are visible both on-ground (increasing GST collections, increasing e-way bills etc.) and in the sentiments of consumer and capital markets. We expect Indias retail to bounce back to the pre- COVID trajectory, with a delay of 1-2 years introduced by the pandemic."

Dabur India Limited: Overview

Brand Dabur touches millions of lives every day. With a portfolio of products made with natural ingredients, Dabur today operates in key consumer products categories like Hair Care, oral Care, Health Care, Skin Care, Home Care and Foods. Riding on our legacy of quality and experience of over 137 years, Dabur has been marrying traditional wisdom with modern-day science to develop high quality products for consumers across generations and geographies, offering holistic health and well-being to its consumers across the globe.

With the vision of being dedicated to the Health & WellBeing of every Household, Dabur has also been working towards contemporising Ayurveda and making the traditional Indian system of medicine more mainstream. With one of the biggest distribution network in the industry, covering 6.9 million retail outlets, and presence across urban and rural markets, Dabur is today amongst the most trusted brands in the country.

We have manufacturing facilities spread across 12 locations in India and 8 overseas. Being the original custodian of Ayurveda, Dabur has been continuously innovating to ensure that the traditional knowledge of Ayurveda remains in sync with the changing needs and aspirations of millennials and centennials.

The Company was growing at a steady pace when the COVID pandemic brought business to a standstill towards the end of the 2019-20 fiscal. Amidst this challenging business environment, Dabur quickly revamped its portfolio to meet the growing consumer need for preventive healthcare, personal hygiene, and household hygiene products, while alongside enhancing production of its existing Ayurvedic immunity boosters like Dabur Chyawanprash and Dabur Honey. The Companys business revived quickly and posted strong double-digit growth beginning second quarter of the FY2020-21.

COVID has entirely changed the innovation landscape for Dabur. The Company not only increased its R&D spends but also ensured that innovations are targeted to meet the consumer needs and are quick to reach the market. This shift in our innovation strategy is the reason why we were able to roll-out more than 50 new products within few months of the COVID outbreak.

Through the course of the year, Dabur continued adding more products and offered age-old Ayurvedic remedies in convenient and modern formats which not only increased its repertoire but also provided a better connect with millennials and centennials, besides the tactical foray into the Personal & Household Hygiene space. This strategic business transformation exercise to develop and implement aggressive growth strategies in the core business areas and successfully address the emerging challenges helped Dabur sail through troubled waters to deliver a quick turnaround during 2020-21 fiscal. The consumer-relevant innovations were also well received with new products accounting for 5.6% of Revenue during the year, a high for the Company.

The year was also characterised by continued investment behind our distribution, with village coverage rising to 59,217 from 52,298 a year ago. despite the macro-economic challenges, Dabur also sharpened its focus on the Power Brands strategy through increased investments behind the 9 power brands. More details of this strategy have been provided in other sections of this report.

The pandemic has led to a shift in shopping behaviour of consumers with the propensity for online shopping increasing. in the post-COVID world, e-commerce has emerged as the most-preferred contactless method of making purchases, among consumers and this trend is likely to stay. Dabur has also seen its e-commerce business more than double. our e-commerce business has grown to almost 3 times in revenue and today has a saliency of over 6% as compared to 2.4% in 2019-20. With the second wave of the COVID pandemic leading to localised lockdowns in some parts of the country, e-commerce continues to be one of the fastest growing channels for the Company.

Targeting this emerging trend, Dabur launched a series of new products exclusively for online markets. Some of these products, co-created with online retailers, continue to be exclusively available only in the e-marketplaces while some others have been introduced in Modern Trade outlets as well during the year.

The online exclusive launches include a range of 5 singleherb tablets under the Dabur Pure Herbs brand, a range of herbal teas under the Dabur vedic Suraksha Tea brand,

Dabur Apple Cider vinegar, a range of 8 baby care products under Dabur Baby brand, Dabur organic Honey, Dabur Himalayan Forest Honey, Dabur 100% Pure Cow Ghee, Dabur Mustard Cold Pressed oil and a range of Hair oils and Shampoos under the vatika Naturals and vatika Select brand, respectively. details of Daburs online and digital initiatives have been shared in subsequent sections of this report (Page 147).

Strategic Business Units

Dabur has a diversified product portfolio that covers key FMCG categories like Health Supplements, oTC & Ethicals, digestives, 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 62.0% of Consolidated Sales

• Foods Business: This comprises Packaged Fruit Juices and Culinary Products, which account for 9.3% 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 26.4% 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.1.5.

India FMCG Business

The category-wise Revenue mix of the India FMCG business is presented in Fig. 1.6.

Health Care:

The rapid spread of the COVID-19 pandemic led to a surge in demand for immunity-boosting Ayurvedic Health Care products in India. Ayurveda, with its time-tested remedies and benefits, gained prominence in the minds of consumers who were seeking natural remedies to fight against the illness.

The growth of the Ayurvedic products market was driven by the rising popularity of natural and organic medicines, in confluence with the growing awareness regarding the benefits of these medicines among the consumers. Moreover, the improving accessibility of Ayurvedic products in both urban as well as rural regions further invigorated the sectors growth. Penetration of some Ayurvedic products like Chyawanprash increased significantly during the year with a growing number of young consumers adopting this time-tested remedy to build their immunity.

According to Expert Market Research consultant services, the market for Ayurvedic products is expected to grow at a CAGR of 15% between 2021 and 2026. Greater innovation and emphasis on developing newer products coupled with the adoption of aggressive marketing strategies by players in this sector are guiding the growth of the market in India.

The Health Care business contributes to 39.0% of Daburs India FMCG business and the category witnessed a strong growth of 31.9% during the year 2020-21. This vertical comprises sub-categories like Health Supplements, Digestives, OTC and Ayurvedic Ethicals. The year saw a rapid expansion of Daburs Healthcare portfolio with the introduction of a range of products like Health Juices, immunity-boosting Herbal Tea, single herb tablets, herb- induced honey, to name a few.

• Health Supplements category for Dabur grew 42.5% during the year with all brands reporting strong double-digit growths.

This category features flagships brands like Dabur Chyawanprash, Dabur Honey and Dabur Glucose. During the year 2020-21, the portfolio was expanded with the launch of new brands like Dabur Vedic Suraksha Tea, Dabur Pure Herbs tablets and Dabur Himalayan Apple Cider Vinegar.

Dabur Chyawanprash: The flagship Health

Supplements brand from the House of Dabur, Dabur Chyawanprash is a time-tested Ayurvedic formulation of more than 40 Ayurvedic herbs that aid in boosting the immune system, thereby protecting the body from everyday infections like cough & cold etc. caused by bacteria, viruses, dust, and weather change.

 

Key Highlights for FY2020-21:

A series of high-decibel digital campaigns were launched across media, highlighting the importance of boosting the bodys immune system in the fight against COVID-19 pandemic and how Chywanprash is highly beneficial for the same.

Bollywood star and fitness icon Akshay Kumar signed as the new face of Dabur Chyawanprash. A new campaign featuring Akshay Kumar, was launched, with the message to come together and pledge to build "inner strength & fighting spirit" in these uncertain times.

Dabur also signed Nagarjuna as the regional brand ambassador for South India.

A multi-centric clinical study was launched to validate the beneficial role of Dabur Chyawanprash in prophylaxis of COVID-19 infection by virtue of its immunity boosting property. The findings of the study, which has been submitted for publication in a peer-reviewed scientific journal, reveal that regular use of Dabur Chyawanprash reduced the risk of COVID-19 infection by up to 12 times in comparison to control group which was not consuming Chyawanprash. it was also observed that with regular usage of Dabur Chyawanprash, there was up to 6 times lesser severity of COVID 19 infections when compared to subjects in control group. Details of this study have been shared in the earlier sections of this report.

Apex research body of Ayurveda, The Central Council for Research in Ayurvedic Sciences (CCRAS) also conducted a Clinical study on Chyawanprash for prevention of COVID-19 infection among healthcare workers where Dabur Chyawanprash was used as investigational Product.

A unique program ‘Seva Ko Salaam was organised to honour the bravehearts of Delhi Police for their selfless services during the challenging times. Under this initiative, a team of Dabur volunteers asked citizens to share their feelings for the Police Force and collected their wishes for the good health of Policemen. For every wish collected, Dabur donated a pack of Dabur Chyawanprash to Delhi Police.

Dabur Chyawanprash bagged two Awards at the ET Brand Equity Brand Disruption Awards-2021. The brand won the Silver award for Best Campaign in Healthcare for its immune India Movement initiative; besides a Bronze for the Most Disruptive Rural/Regional Campaign with its anti-Smog campaign.

Riding on these initiatives, penetration of Dabur Chyawanprash doubled to 7-8% during the year.

Overall market share of Dabur Chyawanprash increased by ~200 basis points further strengthening its position as a market leader in the category.

Dabur Honey: Dabur Honey is a leading player in the branded honey market in India. Dabur has been working on twin strategy of offering a better-quality product on the one hand while establishing Dabur Honey as the weight management specialist on the other hand. Honey is also known for its immunity boosting properties.

Key Highlights for 2020-21:

Dabur launched a new campaign to reinforce consumer trust on the quality & purity of honey that it offers to consumers in India. As part of this campaign, the Company offered consumers a chance to check the authenticity and purity of the product and acquire a Certificate of Purity online.

To ensure 100% purity of Dabur Honey, Dabur conducts 100+ quality tests on the brand. The brand also meets all the 22 parameters laid down by FSSAi, the food safety regulatory body in India. As per the press release of FSSAi dated 3rd December 2020, of all the countries across the globe as well as Codex Alimentarius Commission, India has the most stringent standards for honey.

The list of regional celebrities for Dabur Honey was expanded with the signing of Tollywood diva Ritabhari Chakraborty as the new Regional Brand Ambassador. A new campaign "Aaj theke shudhu, chini noy, madhu", featuring a famous Bengali song by Asha Bhonsle "Jaabo ki jaabo na" was launched to create awareness about the importance of Honey for health and to promote Dabur Honey - with lower calorie level, its immunity boosting properties and the presence of Antioxidants and Minerals - as a healthier alternative to sugar.

Following the COVID outbreak and the resultant lockdown, Dabur Honey launched a series of digital initiatives to promote quick healthy recipes for consumers using Honey. A special #StayFitFromHome campaign was also launched 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.

On international Yoga day, Dabur Honey spearheaded a holistic health campaign, AatmaRaksha Movement, wherein through the #HoneyYogaChallenge, it urged everyone to do as many surya namaskars as possible to boost their immunity and remain healthy. The campaign was endorsed by Ms. Mandira Bedi, a highly recognised fitness enthusiast.

Dabur Honey joined hands with ZEE5, Indias Entertainment Super-App to launch an exclusive chat show - ‘Dabur Honey Hello Fitness to motivate and encourage India to be proactive about their well-being. The show let viewers get an exclusive peek into the fitness routines and healthy habits of their favourite celebrities.

• During the festive season, Dabur Honey joined hands with sweet shops across Kolkata and Pune to co-create, sample and sell Dabur Honey-based traditional and innovative sweets like Sandesh, gajar halwa, gulab jamun, motichoor laddu, peda etc. Promoters also highlighted the health benefits of replacing sugar with honey in their daily life.

A high-decibel TV Campaign was launched during the year to educate consumers, in an interesting and humorous manner, about the many lookalike honey brands that have hit the store shelves. The theme of the campaign is "A^li honey lena hai to, Dabur Honey ka logo dekh kar lo".

Dabur expanded the Honey portfolio with the launch of Tulsi Honey and Ashwagandha Honey.

Dabur also partnered with leading e-commerce giants to launch Dabur organic Honey. Procured from organically grown flora, the nutrient and antioxidant-rich Dabur Organic Honey comes with the promise of being completely unprocessed and unpasteurized. in addition, an online-exclusive Himalayan Forest Honey variant was also launched during the year.

With a view to further expand the usage of honey in India Dabur has recently launched chocolate and strawberry-flavoured Honey under the brand Dabur Honey tasties. Enriched with vitamin-d and No Added Sugar, Dabur Honey Tasties comes in a convenient pack and can be used as spreads on breads, as a topping on dessert and even as an ingredient for milk shakes and smoothies.

The year saw Dabur launch project Madhu, an initiative to promote beekeeping or Apiculture as a lucrative enterprise for farmers and small and medium entrepreneurs. As part of the initiative, Dabur is working with local Non-Profit Organizations across Assam, Bihar and Jharkhand to create an ecosystem that will bring together technical know-how, financing and access to marketplace for these farmers and entrepreneurs to train and sustain them in the vocation of beekeeping. As a part of this campaign, Dabur aims to provide 5,600 bee-boxes to farmers which is expected to positively impact the socio-economic situation of 350 families in the states of Jharkhand and Assam. in addition, 2,250 families in Bihar have benefitted through the World Bank-aided Jeevika Project and received 23,500 bee- boxes. Along with the bee-boxes, a team from Dabur would be imparting technical knowledge through training at village, block and district levels.

Dabur Glucose: The third major brand in this category, Dabur Glucose had a muted run this year as the lockdown had put a stop to all outdoor activities. The early onset of summer in 2021 is expected to help drive growth for the brand in the coming year and the Company has lined up a series of exciting initiatives to drive demand. These include the launch of a new Cola variant, besides expanding the Mango variant to North and East India. The 2021-22 financial year will also see the launch of a new convenient pack of Dabur Glucose.

Dabur Vedic Suraksha Tea: in line with our plans to contemporise Ayurveda and offer the time-tested benefits of Ayurvedic ingredients in modern-day ready- to-use formats, we launched the Dabur vedic Suraksha Tea during the year. The herbal tea is powered with 5 immunity boosting herbs - Tulsi, daalchini, Munakka, Kali Mirch and Shunthi. These Ayurvedic herbs combine to give a refreshing taste while boosting your immunity. it is available in 2 variants - Green Tea & Black Tea. initially Dabur Vedic Suraksha Tea was launched as an online exclusive product, but it is now available in Modern Trade and standalone larger retail outlets too.

Dabur Vedic Suraksha Tea stimulates Natural Killer (NK) cells which helps fight day-to-day infections. The herbal tea variants at different concentrations showed an increase in NK cells activity by up to 17% as compared to untreated control in in-vitro studies. it helps boost your immunity, relieves stress and acts as an antioxidant. It also helps against inflammation and is good for digestion & metabolism.

Dabur Pure Herbs Tablets: Addressing the growing consumer need for ready-to-use Ayurvedic health solutions in the wake of the COVID pandemic, the Company introduced a range of five pure herb tablets packed with the power of potent Ayurvedic ingredients.

The range includes:

• Haldi tablets - Haldi (curcumin) helps boost immunity, besides being useful in managing skin problems like acne and promoting healing of wounds. Haldi has an anti-allergic action on the body and is also used for hay fever and high cholesterol. it also helps relieve pain in joints and bones.

• Ashwagandha tablets is a natural immunity booster and one of the most important herbs in Ayurveda, which has been used for years to boost immunity, relieve stress, increase energy levels, and improve concentration. it also helps improve strength and stamina by improving heart and lung capacity. Dabur Ashwagandha has shown an adaptogenic effect that helps fight physical and mental stress and improve general well-being.

• Giloy tablets - helps boost immunity, besides aiding in blood purification and being good for skin and joint health. it acts as an antioxidant for the body, helps purify the blood, remove toxins, and fights respiratory problems.

• Tulsi tablets - helps boost immunity and is useful against cough & cold. Tulsi, due to its unique combination of anti-microbial, anti-inflammatory, analgesic

• Amla Tablets - is a rich source of vitamin C. Amla tablets help improve immunity, have anti inflammatory properties and are beneficial for eyes. The antioxidant properties of Amla helps counter free radicals resulting in reduced oxidative stress, which is responsible for cell damage.

These tablets were launched in the online marketplace and received encouraging response. The Company is now working on expanding this range with the launch of 3 more variants comprising Ayurvedic Mineral Supplements like Zinc, Magnesium and Vitamins.

Dabur Himalayan Apple Cider Vinegar:

In order to meet rising demand for natural products for promoting health and wellbeing, the Company launched Dabur Himalayan Apple Cider Vinegar. it is 100% natural, unfiltered, undiluted, and unpasteurized Apple Cider Vinegar with genuine mother of vinegar content. With no added colour and no added preservative, it is made from 100% Pure Himalayan Apple Juice. Dabur Apple Cider Vinegar is naturally rich in antioxidants and has numerous health and wellness benefits including boosting immunity managing weight and aiding digestion. An organic variant was also launched subsequently at premium price point.

Dabur Immunity Kits:

We put together a range of Immunity Kits containing products like Dabur Chyawanprash, Giloy ki Ghanvati (Giloy tablets), Giloy Churna, imuDab (immunity building syrup), Honitus, Stresscom (Ashwagandha) capsules and Dabur Honey, offering consumers a one-stop solution for the immunity-boosting needs of the entire family. The kit, which was initially sold on e-commerce platforms, was later extended to regular sales channels.

• The Digestive category contributed 5.6% to Daburs India FMCG Business in 2020-21 and reported 2.2% growth during the year.

Dabur has been a leading player in the herbal digestive category with a portfolio of products under key brands like Hajmola, PudinHara, Hingoli, Dabur Nature Care and Sat isabgol.

Hajmola:

Our flagship brand in the Digestive category, Hajmola is based on a centuries-old highly efficacious Ayurvedic formulation. The year opened on a muted note for the brand with lockdowns forcing consumers to stay at home. As a result, the out-of-home purchase of the product took a hit in the first quarter of the year. However, with the lockdown lifting, the brand returned to the growth trajectory and ended the year with good growth.

Pudin Hara:

A proven Ayurvedic remedy for digestion issues, Pudin Hara is a proprietary formulation which addresses stomach pain and indigestion through herbal ingredients such as pudina satva (mint). The brand also faced same depression in the opening quarter of the year with the lockdown hampering all outdoor activities during peak summer months. However, the brand marked a turnaround in the following nine months and ended the year with strong growth. The Pudin Hara Fizz portfolio was expanded with launch of an orange- flavoured variant called Dabur FantoFizz, an effective remedy for gas and acidity. The Company today has three variants in this category with Regular, Lemon and now orange.

• Ayurvedic OTC category for Dabur reported a strong 37.2% growth in 2020-21.

Dabur has been at the forefront on delivering authentic Ayurvedic solutions to meet the Health Care needs of consumers for over a century now. While the demand for Ayurvedic products has been on the rise, the rapid spread of the COVID infection accelerated the trend of people trying out Ayurvedic products particularly immunity-boosting products. COVID has resulted in elevated health consciousness among consumers, who are increasingly looking for healthy and natural alternatives to boost their immunity and reduce their chances of falling ill with the virus.

As people were looking for traditional immunity-boosting methods to counter COVID-19, a window opened for Ayurveda to significantly increase its presence. This was further aided by an advisory from the Ministry of Ayurveda, Yoga & Naturopathy, Unani, Siddha and Homoeopathy (AYUSH) specifying how Ayurveda can be used to build or boost the bodys immune system.

As the original custodian of Ayurveda, Dabur identified this consumer trend early and was quick to react to this growing consumer need by launching a series of Ayurvedic interventions under its OTC portfolio. Within a span of a few months, Dabur introduced a slew of innovations under the immunity umbrella to cater to this growing consumer need. Daburs OTC portfolio today includes products in categories such as immunity Boosters, Cough & Cold, Baby Care and Rejuvenators.

Immunity Boosters:

In the days following the COVID- induced lockdown, immunity became one of the most searched words on the internet. As wellness and preventive healthcare became priority, Indians were constantly searching for immunity-related products on the internet. Ayurvedic herb Giloy and Kadha (herbal concoction) were among the most searched words with 380% and 90% increase, respectively.

Dabur rapidly expanded its immunity Booster portfolio with the launch of host of new products like the Health Drops range (Dabur Tulsi Drops and Dabur Haldi Dops); Health juices range (Dabur Giloy Ras, Dabur Giloy- Neem-Tulsi juice, Dabur Amla Juice, Dabur Wheatgrass juice, Dabur Jamun, Neem, Karela juice and Dabur Aloe Vera juice); Dabur Ayush Kwath Kaadha etc.

Dabur launched a new public awareness campaign ‘Ghar Ghar Immunity to highlight the immunitybuilding benefits of the Health Juice range. Under this campaign, awareness camps were organised in 15 joggers parks in the national capital to educate consumers about the immunity and skin health benefits of the Health Juices range. Sampling was also conducted with automated touch-free dispensers to maintain hygiene and social distancing. Along with the sampling, the joggers were also involved in the campaign through personal engagement by making them brand ambassadors through customized template ads for each individual. The templates were published on Dabur Health Juice Facebook and instagram pages, and the links of each photograph individually sent to the respective brand ambassador through SMS.

Dabur rolled out a programme to support Police Personnel in the Delhi-NCR region by serving them Ayush Kwath Kaadha, as they worked towards ensuring the safety of citizens during the pandemic. The special drive was conducted in Police Stations of delhi, Noida and Ghaziabad. Life-size cut-outs of Ayush Kwath Kaadha packs were placed on minitrucks to drive awareness about the brand, while special booths were set up at various police stations to serve the freshly prepared Kaadha to the police personnel as part of an immunity-building drive.

Cough & Cold:

In the Cough & Cold category, Ayurvedic cough syrups have been fast gaining popularity given the fact that they are effective, safe, and free from any side effects. Dabur operates in this category with its brand Dabur Honitus, which includes a range of Ayurvedic products like Honitus cough syrup, Honitus Lozenges, Honitus Hot Sip and an age-old traditional Ayurvedic medicine Honitus Madhuvani. This range was expanded in 2020-21 with the introduction of Honitus Adulsa Cough Syrup, containing the Adulsa herb. This product, a result of our RiSE initiative, was created especially for the West India market where the herb is known for its soothing effect for cough and as a treatment for respiratory disorders. during the year, Dabur continued with its campaigns highlighting the ‘natural and ‘no side-effect proposition of Honitus cough syrup.

Baby Care: Dabur operates in the Baby Care market with Dabur Lal Tail, an Ayurvedic massage oil, Dabur Gripe Water and Dabur Janma Ghunti, which are traditional tonics for babies. The year 2020-21 marked Daburs entry into the mainstream baby care market with the launch of an online exclusive ‘Dabur Baby Range with 8 products: Dabur Baby Oil, Dabur Baby Wash, Dabur Baby Cream, Dabur Baby Shampoo, Dabur Baby daily Moisture Lotion, Dabur Baby Moisturizing Wipes, Dabur Baby Talc-Free Powder and Dabur Baby Gentle Nourishing Soap.

Being a pioneer in the field of Ayurveda, Dabur is committed to offering the safest and most effective Ayurveda-based solutions for the health and wellbeing of every household. The launch of Dabur Baby Range is another step forward in this direction of launching products, which are based on the age- old knowledge of Ayurveda but available in modern- day convenient formats. Staying true to our roots at Dabur, the Baby Care range focuses on novel natural ingredients, free of chemicals and is gentle on the baby.

Rejuvenators: Daburs Rejuvenator portfolio, which includes Shilajit, Shilajit Gold and Shilajit double Gold, continued to perform well, particularly on the e-commerce platforms. The year saw the expansion of this range with the launch of Dabur Musli Gold which is good for general health and helps increase strength, stamina, and vitality.

• Ayurvedic Ethicals reported growth of 24.8% during the 2020-21 financial year.

This division houses some of the oldest prescriptive and classical Ayurvedic medicines for preventive and curative healthcare. This portfolio includes Ayurvedic medicines to manage a variety of lifestyle diseases like hypertension, heart health, diabetes etc in addition to offering holistic wellbeing through improved immunity.

With the COVID pandemic, several medicines from this portfolio found renewed interest from consumers who were adopting ancient Ayurvedic remedies to fight the illness. The growth in this portfolio was led by immunity-building medicines like Giloy Ghanvati tablets, Stresscom (Ashwagandha) capsules and the premium Chyawanprash variant Ratnaprash. A host of new products were also launched during the year, like Dabur Nasal drops, to expand the Dabur Ayurvedic Ethicals portfolio.

The year also saw Dabur enter the Siddha medicines market with the launch of Kabasura Kudineer, which possesses strong anti-inflammatory, analgesic, anti-viral, anti-bacterial, anti-fungal, antioxidant, hepato-protective, anti-pyretic, anti-asthmatic and immunomodulatory properties.

Key Highlights for 2020-21:

During the year, Dabur conducted 10,724 Health Camps across the country, offering free consultations and subsidized medicines to the poor and needy. Over 1.2 lac patients benefited from these Health Camps.

Dabur also organised 400 Swarna Prashana camps 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. Around 80-100 kids were administered Swarna Prashana at each camp.

With curbs on physical gathering due to the COVID pandemic, Dabur initiated a series of virtual doctor engagement programmes to reach out to more than 1 lakh Ayurveda practitioners. Around 40 Special Ayurvedic webinars were also organised during the weekends to reach out to the medical fraternity doctors and create awareness about the various Ayurvedic interventions. We reached out to around 12,000 doctors per webinar.

With doctors not attending their clinics during the lockdown, digital brand reminders were sent to build continuous engagements with the fraternity.

The year was also marked the launch of creative animated films for some of our Ayurvedic medicines like Giloy, Lakshmi vilas Ras (for cough and cold). Around 6 doctor endorsement films were also created for brands like Ashokarishta, dashmularishta, Ratnaprash, Mahanarayan Tail, Lauhasava, Stresscomm and Activ Antacid, which were aired primarily on News and religious channels.

Participated in a host of virtual conferences like National Aarogya and Ayurveda Parv, besides undertaking high-visibility retail front branding, counter branding and one-way vision branding in doctor cabins.

On international Womens day, Daburs womens healthcare brands Dabur Mensta & Ashokarishta launched a special campaign ‘Khakal Apna Bhi Rakhe to honour Women Police personnel and doctors. Through this campaign, we reached out to women warriors who continued to serve millions of citizens during the pandemic. Dabur reached out to prominent Ayurvedic Hospitals in Bhopal and Patna to felicitate the Women Warriors with a token of appreciation and a certificate. Dabur teams went to various police stations and hospitals to honour them and offer them the gift of health and wellbeing through its products.

Dabur also initiated a drive to ensure the safety of COVID warriors against congestion during the winter months. Under the ‘Khul Kar Jiyo, Surakshit Raho campaign focussed on policemen, security forces, watchman, security guards and newspaper vendors working late nights, the Dabur team distributed Dabur Nasal drops and educated them about the therapeutic benefits of Shadbindu Tail, Anu Tail and Badam Tail, key ingredients of Dabur Nasal Drops.

Special digital Films were also created for several Dabur Ethicals brands. The most prominent of these being the Dabur Rheumatil Postman video which tells the story of D. Sivan, a postman from Coonoor, for his dedicated service of 35 years to India Post.

Wanted to salute the spirit of our frontline Health workers by acknowledging their contribution in alleviating disease and suffering and building a healthy nation.

Dabur organised a month-long special Ayurveda Health Camp along with a special COVID-tO Help desk in association with Ayurjeevanam Seva Samiti at CRPF Group Centre, Rampur, to create awareness about the importance of Ayurveda in fighting COVID-19.

Dabur provided a Healthy twist to Ganesh Chaturthi celebrations in Mumbai with specially made Ganapati Ratan Modak, a combination of Dabur Ratanprash and sweets to give taste with immunity during the Ganesh Puja. This was also covered though a campaign on social media. A similar initiative was rolled out in West Bengal on durga Puja and in delhi for diwali.

Dabur rolled out a mega social initiative Dabur Rheumatil Risto Ke Anmol Rang under which special foot massage centres were set up for Joint Entrance Exam Applicants and their parents. The Centres, set up near examination centres across , Lucknow and Allahabad, offered free touch-free I foot massage to the students and parents, who had ji to walk long distances during the lockdown period to appear for the JEE Entrance tests.

Dabur Rheumatil also set up massage booth for murtikars or artisans who make the sculpture of Goddess durga on durga Puja in West Bengal. A dedicated team from Dabur provided free massage with Rheumatil to help the sculptors relax their muscles.

With increased stress and anxiety becoming a part of the daily routine in the post-COVID world, Dabur Stresscom, along with renowned Mental health expert dr. Prakriti Poddar, organised a series of webinars for organizations looking to help employees seamlessly adapt to the post COVID-tO work environment. These webinars were designed to provide corporates, employees and the wider business community with the latest evidence on the impact of COVID-tO on mental health and how to address it.

Dabur Ratnaprash organised a special event to celebrate Karwa Chauth with the indo Tibet Border Police (iTBP) soldiers and their families at Tara devi - Shimla. As part of this initiatve, christened Majboot Rishto ki Buniya^ad, Dabur Ratnaprash helped wives of iTBP jawans get a chance to celebrate Karwa Chauth with their husbands.

As part of its initiatives to popularise its first-ever Siddha medicine Kabasura Kudineer, Dabur organised a special month-long sampling drive in Tamil Nadus Chennai, Madurai and Coimbatore. Under this initiative, a branded van moved around the three cities, offering residents free immunity boosting medicines while also advocating the benefits of building immunity to fight illnesses and to propagate social distancing protocols.

Home & Personal Care:

Daburs Home & Personal care vertical contributed 47.9% to India FMCG business and reported a growth of 9.5% during the 2020-21 financial year. Dabur has traditionally operated in four categories in this vertical: Hair Care, oral Care, Skin Care and Home Care. The year 2020-21 saw Dabur add a new dimension to this business with launch of a range of hygiene products to cater to the growing demand for such products in the wake of the COVID pandemic.

The new launches in the Hygiene category -- both Home & Personal Hygiene -- were more contextual in nature to meet the growing consumer need in the initial days of the COVID pandemic. These included hand sanitisers, disinfectant sprays and liquids, surface sanitisers, air sanitisers, antiseptic liquid, disinfectant soaps, floor cleaners and veggie wash under brands like Dabur Sanitize, odonil and dazzl. As the year progressed and fear of COVID subsided, a number of these new categories witnessed a moderation in demand. However, some hygiene products like hand wash etc continued to perform well throughout the year.

• Daburs Hair Care business reported 2% growth during 2020-21 financial year and contributed to 18.8% of India FMCG business.

Dabur operates in two segments of the Hair Care category: Hair oils and Shampoos.

Hair Oils:

Oiling hair is a common traditional habit in India for grooming hair. More than 35% Indians are believed to use hair oil daily, which is a key contributor to the hair oil market in the country. Consumers in India are known to use the hair oil for several benefits such as healthy hair, conditioning, and to combat dry scalp.

Dabur is amongst the oldest players in the hair oil market in India with a range of hair oils under brands like Dabur Amla, vatika and Anmol. despite being a : highly penetrated category, the hair oil business for * Dabur reported a steady performance and market share j gain during the year.

Key Highlights of2020-21:

Dabur extended the Amla franchise into the light hair oils market with the launch of Dabur Amla Aloe vera Hair oil.

Dabur also moved ahead with its flanker brand strategy for Amla with the launch of an economy- priced Dabur Badam Amla Hair oil which helped drive penetration into rural market.

The Company rolled out a series of special digital campaigns during the lockdown to build greater connect with the millennials. These included a special film to salute the spirit of women frontline workers who have been supporting the nation during the coronavirus crisis and a film around building bonds with loved ones during the lockdown. Besides, special short duration campaigns were also launched on special occasions like Ram Navami and Eid.

Dabur Amla launched a successful campaign with brand ambassador Kareena Kapoor which talked about the brands benefits in arresting hair fall. The brand continued to be associated with the successful chat show "Dabur Amla What Women Want" featuring Kareena Kapoor who hosts the show.

Anmol Coconut oil performed well during the year posting double digit growth and increase in market share.

The year saw the launch of Dabur vatika Naturals range of 4 hair oils: Spanish olive Hair oil; Moroccan Argan Hair oil; Bringhraj Hair oil; Aloe vera Hair oil. The range has been launched exclusively in the online marketplace.

For the premium enriched coconut hair oil brand vatika, Dabur signed Bollywood star Tapsee Pannu as the national face of the brand. it also engaged Samantha Ruth Prabhu as the regional brand ambassador for South India markets.

Dabur Amla Hair Oil joined hands with the Uttar Pradesh Police to launch the ‘Mazboot iraadon ko Salaam Campaign to honour the special police team of the ‘Pink Brigade. The campaign was organized to spread awareness about the role of this team, created for the protection of women in Uttar Pradesh.

Shampoos:

The Shampoo portfolio accounts for 17.3% of Daburs Hair Care business. Dabur operates in this category with a range of shampoos under the Vatika brand. Shampoo portfolio reported double digit growth during the year.

 

Key Highlights for 2020-21:

The Vatika Ayurvedic shampoo was launched nationally and has already cornered 2% market share in e-commerce.

Saliency of bottles in Daburs shampoo sales improved during the year with good momentum in e-commerce for the brand

Dabur expanded its Vatika portfolio with the online exclusive launch of ‘Dabur Vatika Select premium range of shampoos. The Dabur Vatika Select premium shampoo range includes four products: Coconut Milk Extract shampoo, Moroccan Argan Oil shampoo, Red Onion Black Seed Oil shampoo and Apple Cider Vinegar shampoo.

• Daburs Oral Care business registered a strong growth of 23.2% during the year and accounts for 18.3% of the India FMCG Business.

Dabur has a highly differentiated portfolio of products in this category with brands like Dabur Red Paste, Dabur Babool and Dabur Meswak. The year saw the expansion of this business with the launch of another Ayurvedic toothpaste under the brand Dabur Dant Rakshak and the Dabur Herbl Alpha range in South India. The Dabur Herbl Alpha range includes Clove, Tulsi and Neem toothpastes. in addition, Dabur also operates in the Toothpowder market with its traditional brand Dabur Lal Dant Manjan.

While the overall toothpaste market in India has been reporting low single-digit growths, the Herbal segment within this category has been growing at double the pace and today accounts for nearly 27% of the toothpaste industry.

The year also marked Daburs entry into the mouthwash category with the launch of Indias first Ayurvedic mouthwash, Dabur Red Pulling Oil. Dabur Red Pulling Oil is an Ayurvedic Mouthwash which contains Natural Oils and Herbs. The product is based on a process defined in Ayurvedic scriptures called the Kavala- Gandusha Therapy, an oil-based Oral Detox regimen. it contains Coconut Oil, Sesame Oil, Tulsi, Clove, Cinnamon Oil and Thyme Mint. Dabur Red Pulling Oil helps strengthen teeth and gums, and kills 99.9 % germs, thus, providing complete Oral Care.

Dabur continued to gain market share in the oral care category as all the brands delivered market leading growth.

 

Key Highlights of2020-21:

Daburs flagship toothpaste brand Dabur Red Paste entered the coveted 1,000-Crore Club this year, while Meswak has become a 100-Crore brand.

Dabur Red Paste added Tamil Nadu the states where it has emerged as the No. 1 toothpaste brand. Prior to this, Dabur Red Paste was already the Number One brand in Andhra Pradesh and Odisha. Dabur Red Paste is also second largest toothpaste brand in key markets like West Bengal, Assam, and Punjab.

Extensive sampling was done for newly launched Dabur Dant Rakshak toothpaste through an exchange offer. This gave consumers a chance to exchange their existing toothpaste for a fresh pack of Dabur Dant Rakshak free of cost.

Dabur Red Paste strengthened its presence in the digital space with nearly 1 new video every week. These helped the brand generate over 1.5 billion impressions and over 100 million views.

Dabur launched a new campaign for its Dabur Herbal family toothpaste in Kerala to further strengthen the brands regional connect by tapping into the strong ‘rootedness in tradition especially for upkeep of oral health and well-being. In a first for the brand, this campaign was shot in Kerala with local actors. The new campaign was rolled during the festive period of Onam, which helped further strengthen the franchise and was well received.

A special digital film was released by Dabur Meswak in which travel influencer Meenakshi Arvind went on a trip to search for a tree called ‘Miswak tree. The film captures her journey to Ramanathapuram in Tamil Nadu to discover Miswak Nagar, a small town named after the tree.

In the wake of the COVID pandemic, Dabur Red Paste launched 3 films adding to the ‘#ChabaateyRahoIndia series, advising people to remain tough, resolute and prepared against the pandemic. Done in the usual fun and light-hearted manner, the thought is brought to life through tough- to-chew ‘immunity building foods, that we are all consuming to boost our immunity. In the film, we see the protagonist Chaubey Ji chewing through the toughest foods like amla, ginger and raw turmeric to prepare himself against the pandemic but is not fazed by their toughness because he uses Dabur Red Paste.

Dabur Red Paste launched a new campaign ‘Desh Ka Lal that sought to showcase the brands growing popularity across regions, languages, and cultures to become an integral part of the lives of its 35-crore consumers.

Dabur took forward its highly popular Dabur Red Dant Snan initiative by setting up exclusive Dabur Red Paste Dant Snan Zone during the Kumbh Mela in Haridwar. These zones helped spread the message of Oral hygiene amongst the lakhs of devotees at the Kumbh Mela using a unique Toothpaste dispenser.

High decibel campaigns, featuring regional brand ambassador Ravi Kishen, in rural markets helped Dabur continue to drive demand for its toothpowder brand Lal Dant Manjan, which reported good growth.

• Daburs Skin Care & Salon business continued to grow at a steady pace and ended the year with a 17.6% growth.

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. Daburs beauty brands continued to roll out initiatives and campaigns in the Digital space during the lockdown period to stay relevant in the minds of our consumers. in addition to these brands Dabur launched Dabur Sanitize in the hygiene segment to meet the consumer needs during COVID.

 

Key Highlights of2020-21:

The brand Gulabari was relaunched with a new design and contemporary packaging with the twin objectives of countering spurious product makers and staying ahead of competition.

With Do-it-Yourself Skin Care at Home picking up during the lockdown period, Dabur repositioned Gulabari towards adjunct usage and shot a new TVC promoting the same.

Dabur Gulabari also signed Bollywood star Disha Patani as the new face for the brand.

With the Salons closed during the lockdown, Fem was repositioned as an in-home usage brand offering ‘Salon-like Glow at Home. A testimonial campaign was also launched for the brand with consumers talking about their real-life experience with the brand.

Fem handwash brand was upscaled during the year and witnessed strong growth. Dabur also launched a unique video to promote the importance of hand wash to arrest the spread of COVID-19.

The Company added the brand Dabur Sanitize to capture heightened demand for sanitizing products during the lockdown. The demand performed well during the peak lockdown months. However, the sales moderated as demand reduced and many players entered the category.

• Daburs Home Care business was heavily impacted by the COVID-induced lockdown and reported a decline of 6.8% during the year.

Dabur operates in the Home Care category with brands like Odonil (air fresheners), Sanifresh (Surface cleaners) and odomos (Mosquito Repellents). With the lockdown, consumer spending on Home Care, which is seen as a highly discretionary and lifestyle-driven category, dropped significantly. However, sales picked up sequentially and came back on growth trajectory in last quarter of the year.

 

Key Highlights of2020-21:

The Company launched new innovative air sanitizers under Odonil Brand that help fight germs while providing a nice fragrance. The idea of odonil Air Sanitizer originated from the growing concerns of air quality and how people have started tracking AQi on a regular basis. This product helped us reposition odonil as an Air Care Expert that provides ‘Fresh and Healthy Homes.

In the Mosquito Repellent category, Dabur operates in the personal application products sub-segment, which is usually used when kids are going to school or parks. With the schools and offices closed during the lockdown and people restricting their evening walks in parks, demand for personal application products dropped significantly.

A number of hygiene products were launched during the year such as Disinfectant Sprays, Veggie Wash, Laundry Sanitizer, Floor cleaners, Antiseptic Liquid and Germ Protection Soaps. These performed well during first half of the year due to heightened focus on hygiene and safety from infections.

Dabur rolled out a mega social initiative in 5 cities on Global Hand Washing Day. More than 2.85 lakh units of Dabur Sanitize Germ Protection soaps were distributed to police, hospitals, and Municipality Offices.

Food and Beverage (F&B):

Daburs Food & Beverages business contributed 13.1% to the India FMCG Business and reported decline of 5.7% in 2020-21. Dabur operates in this category with packaged Fruit Juices under Real and Real Activ brands, and Culinary Pastes and sauces under the Hommade brand.

While the food business (formerly known as culinary business) continued to perform well all through the year, the beverage business was severely impacted by the prolonged shutdown of the institutional or HORECA channels. The lockdown also led to a massive drop in the out of home consumption of small on-the-go packs, which have a saliency of around 30% to the business. Excluding the HORECA business, Daburs F&B business reported 3% growth during the year. Despite the decline in the Juices & Nectar (J&N) category, Dabur continued to report strong market share gains with the Company capturing 59.2% market share of J&N category in 2020-21.

Real:

The fruit juice and beverage business had faced severe headwinds in the previous financial year with consumers tightening their purse-strings and shifting preference to lower priced products like aerated beverages and milk-based products. The business continued to face pressures in the initial part of the year with the government announcing a lockdown, bringing the institutional business to a standstill. While the business saw a strong revival with in-home consumption returning to near normal levels in the subsequent quarters, the out of home category continued to be impacted by the continued closure of Hotels, Restaurants and institutional businesses.

Our beverage business reported a smart recovery in the second half of the year in line with the growing consumer need for health. Our expanded in-home and out-of-home portfolio aided to this revival. While the HORECA channel is still not back to its normal levels, the early onset of summers in 2021 is helping drive growth for the beverage industry.

 

Key Highlights of2020-21:

Dabur re-purposed its brand communication for fruit juices and beverages to highlight the immunity benefits of our Real range of fruit juices and beverages. 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.

We launched new immunity-boosting juices like Amla Plus juice in a ready-to-drink format under the brand Dabur. New flavours were also added to the portfolio with the introduction of Aloe-Kiwi juice and Masala Sugarcane juice under the Real brand.

To tap into the growing demand for low-priced drinks, Dabur entered the fruit drinks market with a Rs 20 and higher price point in the PET format, which was well- received in the market and ended with a 1% share of the large fruit drinks market in India. in the larger Juices, Nectars and Still Drinks category, Dabur had captured 10.3% market share by the end of FY21.

We further strengthened our presence in the beverage space with our entry into the milk-based products market with Real Frappe Milkshakes in four variants -- Belgian Chocolate, French Vanilla, Strawberry and Mango. The products were very well received, and the brand ended the year with a 1.3% market share of the milkshakes category.

Riding on the distribution enhancement exercise, Real expanded its presence in the hinterland with its lower priced offerings and affordable packs. Targeting calorieconscious consumers who are increasingly seeking beverages that bring out the natural goodness of fruits without the guilt of excessive calories, Dabur launched premium health-focused variants with a Low-Calorie range under Real Activ.

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 expanded this portfolio with the introduction of a range of pickles, a range of traditional Indian Chutneys, Tasty Masala and the extension of Hommade into Tub Pack with Ginger Garlic Paste. Dabur also increased its digital footprint for Culinary pastes, to better reach out to younger consumers who were experimenting with cooking at home during the lockdown. The brand witnessed strong growth driven by these initiatives.

In order to make an entry into value added staples category, the Company introduced Dabur Cold Pressed Mustard Oil and Dabur 100% Cow Ghee on ecommerce platforms. The products received encouraging response from consumers.

International Business

The international Business contributed 26.4% to Daburs Consolidated Revenues during 2020-21. 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 3.4% during FY 2020-21. The region-wise split of Daburs international Business Revenue is presented in Fig 1.7.

Middle East & North Africa (MENA)

The Middle East region is the largest business comprising 25.3% of the international Business. Traditionally it has been a Hair Care business with a significant contribution of Hair oils but now Shampoo has emerged as a substantially large segment where we are gaining market share and adding new consumers to the franchise; meanwhile, being market leaders in Hair oils, we continue with category development initiatives. The business has further diversified with the oral Care category gaining traction and emerging as a key growth driver. The other important segment is Skin Care and in addition we have seeded Health Care and Foods categories across countries.

During the year, the Company faced COVID driven macroeconomic headwinds and category growths for non-essential categories such as hair grooming, and styling were under pressure across markets. in addition, strict and prolonged lockdowns in some of the markets impacted movement of goods.

in this scenario, the Company improved market shares in most of the categories in hair care, oral care and skin care largely driven by optimization of marketing mix and digital media becoming more significant. In addition, tactical but aggressive consumer promotions and trade spends were deployed to counter heightened competitive intensity in certain markets and categories. A key pillar of growth were NPDs in emergent categories within home, health and hygiene segments.

Hair Care:

The Hair Care business 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 younger consumers through the new Dabur Amla Hair oil communication ‘Strong Hair, Stronger You and vatika Enriched Hair oils relaunch with a 20-minute nourishment proposition.

• The Dabur Amla campaign celebrated younger local Arab and expat audiences resilience and strength through multiple creatives. Each of these creatives emotionally depicted young girls display inner strength that is synonymous to Dabur Amla Hair oils function of strengthening roots for stronger hair.

• Dabur Amla extended the ‘Strong Hair, Stronger You campaign on ground in UAE by tying up with non-profit Friends of Cancer Patients (FoCP) and Tips & Toes Salon to support cancer patients. Dabur Amla spread awareness on the consequences of chemotherapy and partial or complete loss of hair in cancer patients and invited volunteers to donate their hair that can be transformed into free wigs. The campaign received nationwide press coverage and was very positively received by consumers with 300 women donating their hair for the cause.

Dabur continued to expand its presence in the niche but fastgrowing organic Coconut oil category with USDA organic certified Dabur Virgin Coconut Oil, that was introduced last year and maintained its leadership position in the Hair oil category with 69% market share in KSA and 41% in UAE.

Newly 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, increased its presence across pharmacies to target discerning hair care consumers.

Dabur Amla, which extended its equity into Kids range continues to grow aggressively. With its one-of-a-kind animated communication featuring protagonist Princess Amira doing wonders with her strong hair, Dabur Amla Arabia channel on YouTube saw its subscriber base increase to 430,000+ with 422 million views to date.

Vatika refreshed its entire range of products by further enhancing its product proposition and revitalizing packaging designs across shampoo, hair oils, hair creams, hot oil treatment and hair colours, making it more appealing and relevant to the Arab youth. vatikas commitment to nature is in sync with our consumers desire to help the environment. Vatika#NotesByNature campaign is making this a reality by planting a tree for every thousand plays. With this campaign, Vatika leveraged technological innovation and power of digital connectivity to effect impactful positive change.

Upholding the brand purpose, #VatikaVoices campaign aims to enable Arab consumers live their natural best through sharing inspirational stories of remarkable women achievers and enabling fellow women aspiring to excel in their respective fields.

Vatika Shampoo launched youth focused, brand infused content ‘AYA (As You Are), a progressive, Pan Arab collective of creative influencers that connects with young Arab women through unique story-selling. The digital activations, combined with pan-Arab TV Media campaign and enhanced value proposition for consumers, led to market share gains in Saudi Arabia and UAE. Vatika Enriched Hair Oil range was relaunched with a 20-minute nourishment proposition. Supported by new TV commercial and digital campaigns, the relaunch enabled a strong share gain to reach 24 % MS in Saudi Arabia.

Leveraging the COVID situation, Vatika Hamam Zait promoted its in-home salon treatment proposition to aggressively gain share and consolidated leadership position with 51.5% MS in Saudi Arabia and 52.2% MS in UAE. Vatika Hair Cream continued to maintain its leadership position in Saudi Arabia and UAE despite intense competitive pressures. With enhanced product formulations and refreshed pack designs, Vatika increased its relevance for consumers with new-age performance claims and compelling new TV Communication.

Vatika Henna Colour is a strong No 2 Player in the UAE with the launch of new innovative and youthful fashion shades of Plum, Mahogany & Blue-Black. Backed by social & digital campaigns, Vatika Henna targets young consumers to pick up its fashion shades as their first choice of colouring product. Vatika also introduced a first ever range of Creme Colours infused with natural colouring oils to combat the category barrier of dryness.

Oral Care

Dabur continued to achieve strong market share gains in the highly competitive Toothpaste category and reached 16.5% Market Share (as per UAE Nielsen) primarily driven by significantly enhanced presence on both traditional media (TV) and Digital and improved in-store visibility. Further, the highly successful campaign #StrongTeeth^ StrongAmbitions won the "Best Marketing Campaign" at the prestigious Beautyworld Middle East Awards during the year. The campaign celebrated the 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 Dabur Herbl being a purpose driven brand which encourages youngsters to achieve their ambitions.

In the COVID impacted new normal, a new segment of "Cautiously Extravagant" consumers emerged and Dabur Herbl Toothpaste was well positioned to service this new segment with its highly premium alpha ingredient range of toothpastes comprising Activated Charcoal, Olive, Blackseed and Aloe Vera variants. in-line with caring for the environment these come with a Bamboo toothbrush. This premium range of Dabur Herbl toothpastes garnered highly positive response across markets during the year.

An innovative format of LUPs of toothpaste was introduced without mono cartons during the year to further drive penetration in traditional trade and generate trials in modern trade with placements at check-out counters. The Dabur Red franchise which was initially launched to target South Asian consumers in GCC region is being extended to Arab consumers and was advertised for the first time on Pan Arab Tv channels during the year and well supported with new packaging. during the year, Dabur Herbl entered the toothbrush segment. The pilot launch has elicited positive response and will be gradually extended to other markets.

Skin Care

The flagship Skin Care brand DermoViva was extended into the Hand Sanitizers category in the wake of the urgent need gap that emerged due to COVID-19 in March 2019. With Daburs supply chain strength enabling shorter time to market than other players, Dermoviva was able to capture a huge portion of sanitizer demand across more than 25 countries. DermoViva Anti- Bacterial Hand Sanitizer range was launched in two variants, Aloe Vera and Olive, providing the added benefits of natural ingredients to the otherwise only alcohol-based hand sanitization. COVID-19 also gave a boost to the hand washing category where Dermoviva more than doubled its volumes during the year. in the coming year, Dermoviva face & skin care range will see a transformation to capture evolving consumers needs.

In the Depilatory category, Fem continued its tie up 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 15 million+ views. 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.

Health Care

Dabur expanded healthcare portfolio in the GCC markets. As boosting immunity was a preference for consumers during COVID-19, Daburs immunity boosting products - Chyawanprash & Honey witnessed greater demand. Dabur Honitus Lozenges was introduced in 4 variants viz Honey, Orange, Lemon and Mint. Dabur Honitus highlighted strength of its natural ingredients in curing sore throat in its communication across Radio, TV and digital media. The Company also introduced Rapidex in pain relief segment. A number of new products are lined up for expanding the healthcare portfolio.

Foods

With its Real brand, Dabur focused on increasing its presence in Packaged Juices & Nectar category. During the year, Real Mango Lassi in Tetrapack format was launched that has elicited positive response. Given Reals masala juice variants being accepted well by consumers, Dabur is launching 2 new variants of Masala Mausambi and Masala Mixed Fruit in Q1 2021. Dabur is also launching its Hommade range of cooking pastes with Ginger, Garlic, Ginger-Garlic and Tamarind pastes in UAE in April 2021.

Africa

Contribution of African region to Daburs international Business stood at 21.9% in FY 20-21, with Egypt, Nigeria, South Africa and Kenya being the key markets.

Nigeria:

Daburs Nigeria business covers Hair Care, Oral Care, Personal Care and Home Care products. Dabur has continued to consolidate its presence under the national distribution structure which has enabled the reach across Nigeria via the multiple hub-and-spoke arrangement. The business lost initial months of the fiscal year owing to COVID shutdown, followed by a prolonged national strike which created severe economic headwinds. Strong focus through digital media to extend brand franchise and generate demand, coupled with extensive market level visibility led to the business registering a strong comeback and gain market share and numeric distribution in the highly competitive toothpaste category. Our brand access to wide spectrum of sub-distributor network and shared direct-to-retail structure in top cities across Nigeria has enabled volumetric gains.

Low Unit Price (LUP) sachet packs of pre-measured, noLye Relaxer enabled our oRS business to attain leadership position in the market. The team also developed an engaging Influencer-Consumer online connect during the COVID period to enable diY styling coupled with online purchasing through dedicated websites. The consolidation work with the top stylist-hair associations, became extremely relevant during these economically tough times to provide sustained business at subsidized rates to the stylist segment.

To cater to the Hygiene & Health needs of the evolving consumers, the business launched a range of new products like Floor Cleaners, Hand Sprays, Hand Wash and Sanitizers, besides expanding the range of styling and maintenance hair care products to cater to Protective and Go-Natural styles.

South Africa:

During the year, added focus was on diY styling, Maintenance Range and Naturals styling regimens amongst African women on account of closure of salons due to the COVID pandemic. Two offering of oRS Black Castor and vatika Afro Naturals were extended to new markets within SADC (South African development Community) and CoMESA (Common Market for Eastern and Southern Africa). Long & Lasting brand saw a packaging upgradation and the extension into Naturals range, to offer affordability to the value conscious consumer seeking maintenance aids within Natural haircare domain.

Our manufacturing operations for all our brands have been fully integrated and operationalized within Daburs in-house unit at Johannesburg. in addition, new markets within ECoWAS and CoMESA construct have been added to the sales sourcing matrix with the range proliferation to include the Maintenance Care segment from oRS.

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

Egypt:

Egypt is one of the largest markets in Africa and contributes to 12.7% of the international business. The business comprises brands such as Dabur Amla, Vatika, Miswak, Fem, Vatika Gel and Dabur Herbal Toothpaste. Dabur is a household name in hair care category with its strong foothold in the market, with 77% share in Hair oils, 62.7% in Hair Creams and 69.6% in Hammam Zaith where it remained number one brand of choice of the consumers with high market shares. in many other categories such as hair gels, Vatika shampoo and oral care, Dabur is the fastest growing brand with increasing market share. Dabur inched up shares in all the above categories.

The business suffered with the outbreak of COVID-19 during first quarter, however the recovery from Q2 onwards was strong despite continued partial lock downs and restrictions which helped bring back the business on growth path. Dabur invested strongly behind its brands and introduced several new products in the portfolio. New initiatives includes launch of Sanitizer range and extension of mink variant to Vatika hair cream range. With an ongoing strong marketing support through traditional medium, the Company continued its focus over digital marketing with strong presence of its brands across social media garnering 130 mn impressions, and several successful campaigns were executed for its leading brands.

South Asia

The South Asia business for Dabur covers key markets like Nepal, Bangladesh, Sri Lanka and Myanmar. This region accounts for 22.8% of total international business for Dabur.

Nepal:

Daburs Nepal business was under severe stress in Q1 FY20-21 on account of the strict nationwide lockdown announced by the Government of Nepal. As this also coincided with the peak summer season, the highly salient juice business felt the major brunt as out-of-home consumption declined, spending on discretionary categories fell & HoRECA and tourism related channels got impacted. However, post July the business bounced back strongly as the lockdown gradually eased and the Company pivoted strongly towards the Health, Hygiene & the immunity building portfolios.

The Company saw strong growths across categories in the non-food business led by health supplements and oral care. These growths were supplemented by launch of a slew of new products especially in the health & hygiene categories. The Company locally manufactured these new products like Prostyle Hair Fall Control, Dabur Dant Rakshak Toothpaste, Fem Hand Wash, Dabur Sanitiser to name a few, in its Birgunj plant.

Despite the COVID overhang, the Company continued to advertise strongly with a focus on localized communication for greater relevance & connect. in the sales and distribution space, the Company drove urban distribution, expanded rural reach and built capabilities in emerging channels like EComm & Modern Trade.

Bangladesh:

Daburs Bangladesh business manufactures and markets wide range of consumer goods under segments of hair care, personal care, oral care, home care, healthcare, and digestives. in FY 2020-21, amidst COVID-tO challenges, overall business witnessed a strong constant currency growth of 25.7% in revenue. Growth was largely driven by honey, hair oils and oral care category. The Company also ventured into hygiene space by launching sanitizers and handwashes. Dabur Bangladesh continues its focus on range availability and the emerging channels of Modern Trade & E-commerce.

Europe

The European region contributed to 13.7% 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 24.2 % in constant currency terms. The growth was driven by liquid soap and shampoos. Market share of Hobby brand in Hair styling category increased from 18% to 19%.

Turkey continued to face economic head winds in FY 202021. The Turkish lira devalued almost 30% as compared to last year leading to high inflation (12%) and unemployment rate (13%). All categories except liquid soap saw volume decline over last year due to eroding purchasing power and impact of COVID pandemic.

Market penetration of Hobby Body Wash and Hair Styling increased with listing in perfumeries and launch of new products such as Hobby Marsh mellow range in body wash category and Mermaid spray and Kivir Kivir Gel in hair styling category). Anti-bacterial liquid soap was launched mainly focusing on export markets to capitalize on COVID led spurt in demand. Hobby continued its digital and social media presence throughout the year resulting in market share gain in key categories.

America

In USA, Dabur operates in two broad segments, viz., Namaste business and the US Ethnic Business.

Namaste Business:

The Namaste business caters to hair care needs of the African American community and is a leader in the relaxers and hair dress category. The business reported growth of 9.4% during fiscal 2020-21. Namaste is market leader in African hair care categories, and the brand gained because of consumer reliance on trusted brands. Entire distribution model changed during lockdown and there were more sales from big retail chains and Ecommerce. Namaste has strong presence in Mass, Chain and E-com channel, so company got positive results from the strong distribution reach. Our products were available all the time through E-com, though there were some supply related constraints which were resolved with continuous monitoring. We have strengthened our presence in E-comm channel even more during the year.

Namaste continued to focus on new product launches and strengthened its position in temporary hair color and Fix iT wig and weave collection. Newly launched temporary hair color under sub brand ColorBlast performed very well and we have also started distribution in Europe during reported financial year.

Overall, the Namaste business reported considerable improvement in topline and bottom-line, led by its increased volume growth and the realized cost efficiencies.

US Ethnic Business:

With COVID-19 at helm, from small businesses to corporate giants, all faced uncertainty, however, as COVID-19 kept surging, Daburs US Ethnic business, saw a considerable increase in the demand of its products, largely due to its products being based on Ayurveda which emphasizes on the usage of natural ingredients. Products like Chyawanprash saw a growth of over 300% as it helps in boosting immunity and offers many other health benefits.

In FY 2020-21, the business grew by 108% in constant currency terms. The overall sales were driven not only by the food products, but also by the Beauty/personal care products. With the evolution of E-commerce, Dabur products saw increased demand from South Asian consumers as well as from consumers of different backgrounds.

To further strengthen the presence, we have taken new initiatives which include targeting of the millennials through different marketing strategies, like influencer marketing. The future marketing campaigns will see a high emphasis on the digital marketing strategies which will help to align with the ongoing trends and target millennials efficiently.

As we go forward, the priority is also to expand into mainstream chains, regionally & nationally, by launch of premium products. This will help Dabur to not only target new business segments but will also help extending our mission of being able to provide consumers with natural, clean, and healthy alternatives.

Sales & Distribution - India

Dabur is home to a diverse portfolio of products and one of the strongest and widest supply chain in the industry with our products reaching 6.9 million outlets and 59,217 villages across the country.

The initial days of the lockdown saw our sales system come to a complete standstill with most stockists points closed. As the lockdown eased, we worked towards ensuring smooth functioning of the supply chain. We were in constant touch with our retail partners and stockist points, and together we left no stone unturned to get the products distributed to a maximum number of outlets.

Alongside, we developed innovative solutions to ensure uninterrupted supply of our essential products to retailers. We established direct contact with some retailer points and leveraged technology to service demand, to the extent possible. We created a special App for Retailers, through which they can place orders for Dabur products. These orders were then serviced either directly through our Salesforce or through nearby stockists. We also initiated Retailer order-booking through WhatsApp, besides activating our call centre to receive orders directly from retailers. We also joined hands with online delivery service providers like Swiggy, Dunzo, Delhivery, etc. to ensure uninterrupted supplies of our products to retail outlets and consumer households.

With consumers facing difficulties in stepping out of their homes to go to the market and buy products, Dabur rolled out the ‘immunity at your Doorsteps programme to reach out directly to consumer households across the country and provide them easy access to our range of immunity-building and hygiene products. Special points of sale were set up in residential areas and apartments blocks across the country where consumers could purchase our range of immunity boosters like Dabur Chyawanprash, Giloy tablets, Giloy Churna and the Immunity Kit, besides fruit juices and hand sanitisers. Special Dabur immunity vans were also deployed across cities, reaching out to consumers and educating them about the need to boost immunity to fight illnesses, besides giving them access to our range of Ayurvedic Preventive Healthcare products. These vans continued to operate through most part of the year and helped bring Ayurveda closer to their homes.

Moving forward on this mission to make Ayurveda more mainstream and accessible to every household, Dabur has now rolled out a new retail initiative christened ‘Ghar Ghar Ayurveda. This program works towards increasing penetration of our range of products by adding stores and driving assortment through a better store program. The program is supported through steep technological changes in digitizing GTM. This program works towards increasing penetration of our range of products by adding stores and driving assortment through a better store program. The program is supported through steep technological changes in digitizing GTM. The coverage drive was supported through digital footprint of all Dabur Outlets - across rural and urban India. in addition, Dabur tied up with MapmyIndia for a dynamic visualization of existing coverage across urban and rural geographies. The new addition of outlets comes with technology to capture its location and other details automatically. Dabur also rolled out Suggested Order module - an Ai / ML based algorithm that helps salesman drive the right assortment in store - to leverage cross sell and up sell opportunities. The initiative was further supported by rolling out of CRS (Continuous Replenishment System) at stockist point - that enabled automation of order flow - for maintenance of right inventory and Range availability at stockist point to support assortment drive.

The year also saw Dabur embark on an ambitious new initiative ‘Dabur Yoddha to further reinforce its rural presence. Dabur Yoddha was initiated with the twin objective of penetrating deeper into the hinterland while providing sustainable livelihood to the rural folks by appointing them as our local sales representatives in their respective villages. These local representatives would work towards ensuring that our brands and products reach every rural household. This initiative was piloted in Bihar-Jharkhand, Uttar Pradesh, Madhya Pradesh & Chhattisgarh in the first phase. By the end of 2020-21 financial year, Dabur has already appointed 3,100 Yoddhas across these states.

For Dabur, Rural India has been a key growth driver even through the pandemic. in fact, rural demand continues to outpace urban demand, and this is a result of our strategy of expanding our rural footprint. The year 2020-21 saw Dabur further deepen its village coverage and reach out to 59,217 villages by the end of March 2021, up from 52,298 villages a year ago. We see Tier 2 & 3 towns growing at a faster clip as compared to metro towns in the near and medium term. To ride this opportunity better, we plan to expand our distributor network and direct retailer reach in these towns. At an overall level, we reach 1.3 mn outlets directly and plan to reach over 1.4 million outlets directly next year.

Dabur also continued to focus on iT-enablement as a major driver of enhancing productivity and field force efficiency which is being measured through Every Day Great Execution (EDGE). We are also investing in upskilling our field force by identifying the training needs based on their market working and behavioural analysis. This has helped us customise the content and training solutions for every individual.

Digital Marketing

Over the past few years, the world around us has increasingly been moving towards Digital and 2020 -- or shall we say, the year of the COVID pandemic -- became the year when the digital ecosystem saw a revolution of sorts with the acquisition of many new users. This was the year that leapfrogged Indias digital ecosystem into the future.

The year 2020 not only saw e-commerce sales gain new highs, it was also the year when Digital Marketing truly emerged as the go-to solution for brands and companies. The nation-wide lockdown gave a push to augmented reality, mobile marketing, digital animation, video content, voice search and influencer marketing. With most retail outlets closed and social distancing becoming more of a habit, e-commerce became the safe and most-preferred contactless method of making purchases, among consumers. For Dabur, e-commerce sales today account for 6% of our total Sales, up from under 2.4% a year ago. in the normal course of time, this growth would have taken 3-4 years, but the pandemic fast-tracked it.

With the lockdown in full effect, Indians were spending more time on their mobile devices, as per data released by BARC. The average time a user spends on their smartphone increased by 7% in just 8 weeks. Video calling became a common practice to keep in touch with friends and family; while mobile gaming and content consumption rose as users sought more ways to keep themselves occupied. in a manner of speaking, the COVID pandemic has transformed the way we shop, work, and connect with people more than any other disruption in the recent past.

Another major driver for this trend was the growing mobile or smart phone penetration in the country, which, in several key states like Uttar Pradesh and Bihar, even exceeded television penetration. According to GlobalData, a leading data and analytics company, mobile subscription penetration in India is set to cross 100% mark in 2023 from 88.3% in 2020, driven by growing smartphone adoption and increasing coverage of 4G services across remote areas.

Dabur was a fast mover in this market, ramping up our spends on digital and e-commerce exponentially in the past year with brands creating special digital-only content. Today, our spends on Digital platforms, including e-commerce, account for around 20% of the total Advertising spends, up from 12.7% a year ago. A total of 130 Digital First/Digital Only films were created and aired across platforms in 2020-21 financial year. In addition, 830 videos were created on YouTube linked to Health, Lifestyle and Beauty.

The Millennial and GenZ being highly active on social media platforms like YouTube, instagram, Facebook, Snapchat etc, following influencers, picking new age trends from them, learning how tos, and watching DiY videos created by these influencers. While celebrities still work when it comes to build immediate awareness for any brand, these influencers have increasingly become the organic choice for brands to connect with the millennials and GenZ consumers.

Given the fact that these new age consumers trust influencers more than celebrities when it comes to product recommendation, we roped in influencers to improve our connect with these consumers and build awareness and consideration of our brands. During the year 2020-21, we have worked with over 1,700 macro, micro and nano influencers across health & fitness, lifestyle, beauty, sports and parenting genres. Nearly 39% of these influencers belong to the health and fitness arena while 24% were mom bloggers. Given the growing rural and semi-urban user base for digital content, 25% of content created during the year was regional. Our influencer selection has gone hyper-local this year, where we on-board regional level influencers, who can engage and bring a stronger and relatable connect with local consumers.

in all, our videos generated over 5,000 million impressions and 1,000 million views.

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 FY 2020-21, NewUs retail footprint stood at 88 stores across 36 cities. Along with the offline footprint, NewU has also enabled E-Commerce on newu.in and increased presence on other marketplaces. The year was severely impacted due to COVID-19 though the recovery has been significantly faster in second half of the year.

The year saw NewU enhance its portfolio of exclusive brands at its stores with the launch of various products under the brand Jaquline USA such as sheet masks, liquid eyeliner, kajal, cleanser, toner, moisturiser and sun protection. Going forward, the Company plans to expand the Jaquline USA range to cover a host of beauty, make-up and skin care products. The Company is also planning to introduce other brands in hygiene, personal care, skin care and fragrance.

Operations

With our relentless focus on quality and affordability, brand Dabur evokes feeling of trust in the minds of our consumers. Our products are tailored to meet the diverse needs and aspirations of our consumers across the globe. 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). We are now in the process of setting up a new manufaturing unit in Madhya Pradesh, besides establishing a unit in Silvasa to cater specifically to the overseas markets. More details on our manufacturing operations in India are presented in

Manufactured Capital section of the Annual Report.

Overseas Manufacturing

Dabur has been following a 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 needs and preferences of the local populace. Our overseas manufacturing facilities are located in UAE, Egypt, Turkey, Nigeria, South Africa, Nepal, Bangladesh and Sri Lanka.

UAE: in UAE, Dabur has a large integrated manufacturing unit in the emirate of Ras Al Khaimah (RAK). The unit produces a wide range of hair care, oral care and skin care products. With a capacity of over 58,000 MT / 9 million cases of finished goods annually, the RAK unit caters to more than 70 countries. Despite the pandemic affecting normal plant operations, utilizing the Companys strategic investment in plant digitization last year of Manufacturing Execution System (MES) in line with Industry 4.0, RAK unit was able to demonstrate effective remote plant management during the pandemic lockdown and has been able to service the market requirements, while implementing COVID-19 control measures. During the year, the unit enhanced its manufacturing capacity and also launched various cost saving automation projects to capture efficiencies.

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 has an annual capacity of

27,500 MT. During the year, the plant implemented various automation initiatives especially in products like hair colors, and energy efficiency measures by switching to alternate energy sources like natural gas in line with the Companys strategy to optimize its operations cost. The plant continues to build on its operational excellence initiatives to drive cost optimization and wastage reduction. The plant attained iSO 9001:2015 & iSO 22716 and added iSO 45001-2018 Health & Safety, ISO 14001 Environment to reflect ongoing commitment of the business to comply with global best practices.

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 to increase bulk production and filling capacities particularly in view of increased demand for Liquid soap. Hobi also increased its plastic bottle capacity by 30% with investment in new ASB machines and moulds.

Nigeria: Daburs Nigeria factory is located at Lagos and is engaged in manufacturing of oral care, ethnic African hair care and personal care products like toothpaste, hair relaxers, shampoo and conditioner, hair foods, hair mayonnaise, hand sanitizers and toilet cleaners. During the year, the plant increased manufactured volumes coupled with enhanced batch size, wastage reduction and improved OEE through kaizens & TPM initiatives.

South Africa: in South Africa, Daburs manufacturing plant is located in Johannesburg, and has now become the sourcing site for SADC and EA hub markets. The plant produces relaxer kits, tub relaxers, lotions, shampoos, conditioners, hand sanitizers and a variety of styling and maintenance products catering to different styles i.e. relaxed, protective & natural. Annual in-house production is over 286,000 cases with total of 450,000 cases including sheen sprays. Various initiatives for increased batch size, utilization of automated machines to improve the productivity and manage cost control were operationalized. Major safety improvement projects were also executed during the year. New products were added during the year including ORS Black Castor range, L&L Naturals, Vatika Afro Naturals, which continue to grow.

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.

Human Resources

We pursue perfection every day, by continuously aiming to rolls our products that meet the emerging needs of our consumers. And our employees help bring this purpose to life it was aptly demonstrated during the peak of COVID-19.

• The period saw high level of engagement from our employees across the organisation, from our manufacturing units to our field staff. The entire organisation worked as a single cohesive unit, coming out with some highly innovative ideas to support our customers and consumers to ensure) business continuity and minimise the impact of the pandemic on our business.

The hard work, commitment, and invaluable contributions of our extraordinary employees helped us weather the COVID storm and emerge stronger. They are our true Lockdown Heroes

• During the year, our focus was on the physical safety and mental well-being of our colleagues as we dealt with the, emerging challenges while finding flexible and safe ways of working. More details of the initiatives on HR are provided in Human Capital section of the Annual Report.

Financial review

During fiscal 2020-21, the Company recorded Consolidated Revenue from Operations of Rs. 9,562 crore, compared to Rs. 8,704 crore in fiscal 2019-20. Despite a washed-out Q1 due to the national lockdown, the Company registered a 9.9% consolidated revenue growth over the past fiscal, with gross sales crossing the Rs. 10,000 crore mark for the first time.

Material cost in fiscal 2020-21 stayed steady at 50.1%, despite high inflation in commodity prices towards the end of the year. The advertisement and publicity expenditure increased to 8.2% as against 7.5% in the previous year. Employee cost was steady at 10.8% of revenue from operations. Other expenses decreased by almost 100 bps to touch 10.0% of revenue from operations.

The Companys operating profit grew by 11.7% to reach Rs. 2,003 crore. The operating margin saw an increase of Rs. 35 bps to reach 20.9% as against 20.6% in the previous year. Profit After Tax (PAT) was Rs. 1,693 crore in fiscal 2020-21, seeing a growth of 17.2%. Diluted EPS for fiscal 2019-20 was at Rs. 9.58. Table 1 provides a summary of the consolidated income statement.

Table 1: Consolidated Income Statement Summary

All figures are in INR crores, unless otherwise stated FY2020-21 FY2019-20 %
Growth % (Y-o-Y)
Net Sales 9,507.8 8,622.9

10.3%

Other Operating income 53.8 80.7

(33.3%)

Revenue from operations 9,561.7 8,703.6

9.9%

Material Cost 4,789.0 4,360.2

9.8%

% of Revenue from Operations

50.1%

50.1%

Employee expense 1,033.5 947.7

9.0%

% of Revenue from Operations

10.8%

10.9%

Advertisement and publicity 784.4 650.0

20.7%

% of Revenue from Operations

8.2%

7.5%

Other Expenses 952.2 953.2

(0.1%)

% of Revenue from Operations

10.0%

11.0%

Operating Profit 2,002.6 1,792.4

11.7%

% of Revenue from Operations

20.9%

20.6%

Other Non-Operating income 325.3 305.2

6.6%

EBITDA 2,327.9 2,097.6

11.0%

% of Revenue from Operations

24.3%

24.1%

Finance Costs 30.8 49.5

(37.8%)

Depreciation & Amortization 240.1 220.5

8.9%

Profit Before Tax (PBT) 2,057.0 1,827.7

12.5%

Share of profit / (loss) of joint venture (1.0) (0.0)

10,028.4%

Exceptional item(s) 0.0 100.0

(100.0%)

Tax Expenses 361.1 279.7

29.1%

Minority Interest - Profit/ (Loss) 1.7 3.0

(44.3%)

PAT (After Minority Int.) 1,693.3 1,445.0

17.2%

% of Revenue from Operations

17.7%

16.6%

Table 2: Working Capital

As Days of Sales FY2020-21 FY2019-20
Inventories 66.0 57.9
Receivables 21.4 33.9
Payables 73.3 62.1
Working Capital 14.1 29.7

Working Capital in the business saw a significant decline from 29.7 days in FY2019-20 to 14.1 days in FY2020-21. This was primarily on account of reduction in receivable days from 33.9 in FY2019-20 to 21.4 days in FY2020-21. inventory days saw an increase from 57.9 to 66.0. Payable days increased from 62.1 to 73.3.

Table 3: other Key Ratios

FY2020-21 FY2019-20
Debtors Turnover Ratio 17.1 10.8
Interest Coverage Ratio 65.0 36.2

The company saw its debtor turnover ratio improve from 10.8 to 17.1 on account of better management of receivables. The interest Coverage Ratio increased from 36.2 in FY2019-20 to 65.0 in FY2020-21 on account of the reduction in interest expense due to the repayment of debt.

Table 4: ROIC and Return on Net Worth

In Rs. crores FY2020-21 FY2019-20
ROiC 58.7% 43.5%
Return on Net Worth 22.0% 21.8%

ROIC and Return on Net Worth increased on account of strong growth in profit after tax during the year.

Table 5: Cash and Debt position

In Rs. crores FY2020-21 FY2019-20
Debt 350 335
Cash & Cash Equivalents 5,568 4,137
Net Cash 5,218 3,802

The business generated Net Cash flow from Operations of Rs. 2,115 crore in fiscal 2020-21. Capital Expenditure of Rs. 311 crore was incurred during the year which includes the expenditure on domestic as well as overseas manufacturing facilities. The cash available with the Company as on 31st March 2021 was Rs. 5,568 crore and the total debt amounted to Rs. 350 crore. Table 4 reflects the cash and debt position of the Company.

The Company increased its payout ratio to 50% of consolidated Profit After Tax. This has resulted in total dividend of Rs. 839.5 crore for the fiscal 2020-21.

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 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.