Goodknight Filesadmin.co has implied value of around Rs 30,000 cr: GCPL chairperson
The implied value of Goodknight’s business based on the current market capitalization of Godrej Consumer Products Ltd (GCPL) is around Rs.30,000 crore, which was bought by the consumer goods arm of the group for just Rs.100 crore in 1994, the company said in its latest annual report.
Godrej Group bought the Goodknight brand for just ₹100 crore in 1994. A year later in 1995, it sold 51% stake in Goodknight to Sara Lee and started a joint venture with a US consumer goods company.
Later in 2010, GCPL acquired Sara Lee’s 51 per cent stake for Rs 1,240 crore and integrated the business in the company.
Addressing the company’s shareholders, GCPL President Nisaba Godrej said: “We have continued to invest in and grow our household insecticide business over the decades. It was a separate business from GCPL until 2010 when we acquired Sara Lee’s stake and combined the business into GCPL.” .
She added, “We believe this business has an implied value of around Rs 30,000 crore today, based on the current market cap of GCPL, with a 30 per cent CAGR on value creation.
The total market capitalization of GCPL is around Rs. 1.08 crore, as per information available on BSE.
Nisaba Godrej was referring to this in the context of GCPL’s recent Rs 2,825 crore takeover of Sighanias FMCG business which promoted Raymond Consumer Care Ltd along with its Kamasutra and Park Avenue brands.
“At our analyst meeting in May, I shared my excitement and how perspectives from the past can give you some ideas for the future. For me, it comes down to the story of how we acquired our Goodknight brand,” she said.
GCPL is a market leader in the fast growing Household Insecticide (HI) market in India with strong Goodknight and HIT brands.
Furthermore, Nisaba Godrej said that with GCPL’s entry into two new deodorant and sexual wellness divisions with brands such as Park Avenue and KamaSutra, the opportunity for this in the home market is “significant”.
“So, through this, we’re also increasing the number of categories we play in India, and into categories that have the potential for multi-decade double-digit growth,” she added.
In 1994, the insecticide company Transelektra, which manufactured the Goodknight and HIT brands, was for sale. She added that Hindustan Lever, the head of the fast-moving consumer goods company, was keen to acquire it, but the deal was stuck and the owner did not want to wait any longer.
Adi Kotak, the banker overseeing the deal, contacted her father and former GCPL chairman Adi Godrej.
“He needed to make a decision in a week, which didn’t leave much time for due diligence. But he was excited about the category and possibilities, so he made an offer of Rs 100 crore, and asked Uday to buy 10 per cent of the company, then the CEO, buy 5 per cent of the company. cent.”
A year later, GCPL entered into a joint venture with Sara Lee and sold 51 per cent of the business for 100 basic rupees, the same amount it paid to buy the entire company, Nisaba Godrej added.
She further said that GCPL is committed to achieving business growth while becoming more sustainable and inclusive in its approach.
She added, “Preparing female leaders and ensuring adequate representation remains a key priority. We have set specific goals and regularly review progress while ensuring we make the necessary changes to support women in the workplace.”
When Shalini Pushalapalli, Senior Director – Country Head of Google Customer Solutions, joins the GCPL Board of Directors in November 2023, she will be the sixth female director on the board, bringing women’s representation to 50 percent.
“Women represent 47 percent of our total workforce at GCPL, but only 25 percent of senior leadership. We are making a targeted effort to reach 30 percent in senior leadership in the next few years through various recruitment and development initiatives,” she added.
For the financial year ended 31st March 2023, GCPL consolidated net revenue was Rs.13,199 crore.