PremjiInvest (PI), the investment arm of Azim Premji, chairman of Wipro, has picked up a significant minority stake in Mumbai-based Hygienic Research Institute (HRI), the owner of brand Vasmol, for about Rs 220 crore in a staggered deal. PI will get two board seats on the company.
As a focused haircare FMCG company, the Rs 350-crore HRI has a reach of 15 lakh retail outlets, 1,000 modern trade outlets and 15,000 salons. These have enabled the company to leverage its brands, present primarily in hair colour across all formats (powder, creams and henna) catering to consumers directly as well as through professionals.
Manish Chhabra, CEO & MD, HRI, "We are raising $35 million, about Rs 220 crore, in a staggered deal spread across one-two years from PremjiInvest. Funds are raised for our growth plans that include expansion of manufacturing capacities and building new products, specifically haircare range, in the market. We decided to go with PremjiInvest as they understand the consumer space and they also have investments in consumer-focused businesses such as Fab India."
Super Vasmol 33 and Streax are HRI's leading brands, with the flagship Vasmol 33 controlling about 95% of the liquid hair dye market. Industry analysts expect the Indian haircare market to grow noticeably, given the changing lifestyle and consumption habits. The haircare sector, in many ways, has witnessed significant deals with Emami acquiring Kesh King in June 2015 to foray into the ayurvedic hair and scalp care segment for a consideration exceeding Rs 1,600 crore. Additionally, two years back, Godrej Consumer Products acquired 30% in B:Blunt chain of premium salons in Mumbai. HRI, since its inception in 1950 by late Dr S S Nishat, has built several brands even beyond haircare. The vision of the promoter has brought the company to the third generation with Manish Chhabra - who joined the company at a very early age - in the leadership position.
"PI's investment will spur us towards realizing our vision of growing into a Rs 1,000-crore company in five years and creating significant stakeholder value. It will enable the unlocking of our brands' true potential," said Chhabra. He added that the company is at an inflection point in its growth journey and is poised to widen its footprint, commercialize innovative new products and deepen its professional products franchise.
Wipro Group, which is also present in the FMCG space with key brands like Santoor and Chandrika soaps, does not directly compete with HRI.
As a focused haircare FMCG company, the Rs 350-crore HRI has a reach of 15 lakh retail outlets, 1,000 modern trade outlets and 15,000 salons. These have enabled the company to leverage its brands, present primarily in hair colour across all formats (powder, creams and henna) catering to consumers directly as well as through professionals.
Manish Chhabra, CEO & MD, HRI, "We are raising $35 million, about Rs 220 crore, in a staggered deal spread across one-two years from PremjiInvest. Funds are raised for our growth plans that include expansion of manufacturing capacities and building new products, specifically haircare range, in the market. We decided to go with PremjiInvest as they understand the consumer space and they also have investments in consumer-focused businesses such as Fab India."
Super Vasmol 33 and Streax are HRI's leading brands, with the flagship Vasmol 33 controlling about 95% of the liquid hair dye market. Industry analysts expect the Indian haircare market to grow noticeably, given the changing lifestyle and consumption habits. The haircare sector, in many ways, has witnessed significant deals with Emami acquiring Kesh King in June 2015 to foray into the ayurvedic hair and scalp care segment for a consideration exceeding Rs 1,600 crore. Additionally, two years back, Godrej Consumer Products acquired 30% in B:Blunt chain of premium salons in Mumbai. HRI, since its inception in 1950 by late Dr S S Nishat, has built several brands even beyond haircare. The vision of the promoter has brought the company to the third generation with Manish Chhabra - who joined the company at a very early age - in the leadership position.
"PI's investment will spur us towards realizing our vision of growing into a Rs 1,000-crore company in five years and creating significant stakeholder value. It will enable the unlocking of our brands' true potential," said Chhabra. He added that the company is at an inflection point in its growth journey and is poised to widen its footprint, commercialize innovative new products and deepen its professional products franchise.
Wipro Group, which is also present in the FMCG space with key brands like Santoor and Chandrika soaps, does not directly compete with HRI.
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