CHENNAI: Chennai-based CavinKare, the sachet shampoo innovator whose initial promise in the FMCG space remains unfulfilled due to its numerous diversifications, is taking fresh aim in its bread-and-butter personal care business, armed with newly-infused private equity money of Rs 250 crore and a new top management.
Personal care has always been a driver for CavinKare, known for brands such as Chik shampoo and Nyle hair colour, but then the profits it generated were reinvested into a whole host of other businesses. In the last 10 years, the company forayed into businesses such as salons, food, beverages, home care, restaurants and dairy. This hardly helpedCavinKare take on the FMCG sector biggies, something which it seemed capable of when it burst into the scene three decade ago with innovations such as the 50-paise shampoo sachet.
Founder Chinni Krishnan Ranganathan, 52, indicated this will change. "By bringing in the private equity money, personal care is freed from supporting other divisions," he said. Early in June, Mauritius-based ChrysCapital invested 250 crore into CavinKare, which had revenues of about Rs 1,200 crore last year. There have been other recent changes too. In April this year, Ranganathan roped in Heinz India chief Nellaiappan Thiruambalam to head the personal care and foods division. (Ranganathan has stepped back from a day-to-day role, in the process.) He has done away with the restaurant business, which was proving to be a strain on the management bandwidth.
"In the personal care division, you will see a far higher amount of vibrancy," he said. There will also be more buzz -- brand-building spends are being increased by 50%.
His estimate is that the personal care business can help double CavinKare's revenue in three years.