Você está na página 1de 7

DewanIndia.

CONSUMERPACKAGEDGOODSINDUSTRYBACKGROUND CPGs were packaged household groceries and supplies consumed readily and regularly, including foods, personal care products and detergents, among others. The CPG industry comprised manufacturers, wholesalers and retailers. A broad spectrum of competitors prevailed, from standalones occupying niches to integrated firms straddling the continuum. Globally, profit margins were generally low for CPG companies, and their business models emphasized cutting costs, and chasing volumes and elusive topline growth. Three factors usuallyinfluencedaconsumersdecisiontobuyaCPG:price,brandloyaltyandimpulse. In most developing countries, including India, CPG was a local business dominated by small indigenousplayersatprovinciallevels.Veryfewgraduatedtonationalstatus.Manufacturing was generally outsourced and retail channels were shared. Distribution was a key success factorinthebusiness.Inthedevelopingmarkets,therewerealmostnoCPGfirmsthatplayed ontheglobalstage.Itwasnoteasytocreateuniversallyappealingbrandpositionsorproduct assortments and run farflung, peopleintensive retail operations. Having acquired a place among the top 10 CPG companies in India, Dewan was attempting what few other CPG companiesfromemergingmarketshadattemptedtodo:becomeaninternationalcompany. The global CPG industry grew by 2.5 per cent in 2006, up from the 1.5 per cent growth in 2005.Growthwasdrivenlargelybypriceincreasesratherthanbyvolume.Despitelowgrowth ratesandlowmargins,CPGwasanattractiveindustrytomanufacturersandinvestorsbecause demand was stable. Beverages continued to be CPG growth leaders in 2006. Home care products,snackfoodproductsandhealthcareproductswerealsogrowthcategories. The CPG industry in India had a total market size in 2006 of $13.1 billion (not including soft drinksandtobaccoproducts).Foods(includinggroceries)comprised44percentofCPGsales. UnliketheNorthAmericanmarket,whichwasdominatedbyafewglobalplayers,theIndian CPGmarketwasfragmented,withoverhalfthesalesaccountedforbymomandpopoutfits making and selling unbranded and unpackaged goods. This presented an opportunity for consolidationthrougheconomiesofscaleformakersofbrandedproducts.Butbuildingbrands was challenging in the Indian context. National coverage was difficult, particularly for new entrants.Therewereoversixmillionretailoutletsinthecountrytwomillionurbanandfour millionrural.Thesupplychainwasunderdeveloped,andlogisticswerecostlyandchallenging. Although,overall,CPGtransactionsaccountedforasignificantpartoftheconsumersbudget, theywereofsmallindividualvalue,makingthemunremunerativeformarketers. ButwhatmadeIndiaattractivewasthatitsCPGmarketwasamongthefastestgrowinginthe world.TheIndianeconomywaspoisedtogrowat9.2percentin20072008,afterpostinga compoundaveragegrowthrateof8.6percentoverthepreviousthreeyears.Thepopulation
2

INTRODUCTION In June 2007, consumer packaged goods (CPG) companies around the world were optimistically betting on growth in India. Dewan India Ltd. (Dewan) was among the top 10 CPG1 companies in India by revenue (see Exhibit 1). Dewans chief executive officer (CEO), SunilDuggal,wasbullishontheIndianmarket,yethewasalsoconvincedoftheimperativeto internationalize.Scheduledtomeetsoonwithagroupofinstitutionalinvestorstobriefthem onthecompanysgrowthstrategy,Duggalhadtofactorinconcernsabouttheprioritiesofthe companys international business division, and, in particular, he needed to address the concernsexpressedamongforeigninstitutionalinvestors.Duggalanticipatedtheirquestions: ShouldntDewanfirstbuildscaleinthefastgrowingdomesticmarketbeforeattemptingtogo global?Wouldntastrategyofpursuingnewglobalmarketsdetractfromthecompanyscore market in India, where it was beginning to face growing competition from international players, a fast changing retail landscape and an ever more fastidious consumer? Wasnt the growth pattern within the international business division skewed, and likely to be further skewed(seeExhibit2)?

Duggalwaskeenlyawareofthedetractorsarguments: Whenever an Indian company announces a domestic expansion, through an alliance or acquisition, its stock price goes up. But on news of an overseas expansion, the stock price falls. That is because of investor apprehensions about integration,productfitandthealiennatureofthemarket.Inaddition,Indiaisan excitinggeographyintermsofsizeandgrowth,diversityandopportunity,andwill remainsointhecomingdecades.Thisoffersitsownrationaleforsometoexpect thatmanagersinaquintessentiallyIndianenterpriselikeDewanmustfocustheir time and energy on the home market they know best. But the reasons to go beyond Indian shores are compelling for us. They outweigh the reasons to concentratesolelyonIndia. DuggalstaskwastopresentaplanthatwouldconvinceFIIsthatthecompulsionsweresound, that the strategy being followed by Dewan International Limited (DIL), a newly formed subsidiary,wasontrack,andthattheongoingglobalizationplanwouldindeedboostvolumes andmargins.

Marketingbrandedandpackagedconsumergoodsthroughretailoutlets,theyweremorepopularlyknown inIndiaasFMCG(FastMovingConsumerGoods)companies.
1

wasyoung,dynamicandwillingtotrynewproducts.AlmosthalfofIndiasonebillionpeople wereundertheageof20.Teensamongthem numberedabout 160 million.TheIndianCPG marketwasprojectedtogrowalmostthreefoldby2015to$33.4billion.Growthwasexpected inthepersonalcare,food,beveragesandhouseholdcarecategories.Thesewerecategoriesin whichDewanhadstrongbrands.

DOMESTICCAPABILITIES Dewans major domestic competence is its ability to identify consumer needs, develop localizedproductsandcreatenichestodrivelongtermgrowth.Thenichesnotonlyprovided differentiationbutinsulatedDewanfromcompetition.Setuporiginallyasamanufacturerof herbal medicines, Dewan had extended the principles of Ayurveda (traditional Indian Medicine)topersonalcare.Inspiteofitslongheritage,Dewanwasacontemporaryenterprise wherenewproductsorvariantscontributedbetween5%and7%ofsalesrevenueeveryyear. The Ayurvedic platform, on which Dewan was launching products, was rooted in strong internal research and development (R&D), which, among others, was identifying plants with therapeuticpowersandpromotingtheirlargescalefarming.Thecompanyhadbuiltupskills inproductengineeringandlocalization.Forexample,whilelargeplayersusedcoconutinhair oils,Dewanusedamla(gooseberry),whichhaditsrootsintraditionalmedicine. The companys sales force was focused on channels, not products. Dewan had a sales force dedicated to key grocers, mass grocers, chemists, modern retail outlets and wholesale in townswithapopulationlargerthan500,0002.Theruralmarket,whichprovided50percentof Dewanssales,haditsowndedicatedsalesteam.Thecompanywasmovingawayfromoneoff discount schemes towards longterm loyalty programs that encouraged channel partners to purchasemorethroughouttheyear3.Dewanwasimplementingchannelsoftwaretocapture data on stock levels at stockists and to assess the effectiveness of promotions and design schemesforparticularregionsandproducts.Dewanhadanindependentsupplychainforeach ofitsfourbusinesssegments.

DEWANCOMPANYBACKGROUND Establishedin1884byDr.S.K.Burmanasatradingcompany,by2007,Dewanmanufactured over450products,whichitsoldinthedomesticmarketthroughanetworkof1.5millionretail outlets,47clearingandforwarding(C&F)locationsand5,000distributors.Thecompanyhada consolidatedsalesturnoverofINR22.6billionfortheyearendingMarch2007(seeExhibit3). Dewan had four business units: consumer care, consumer healthcare, foods business and internationalbusiness. Consumer care offered products in hair care, oral care, health supplements, digestives and candies,andbabyandskincareproducts.Consumerhealthcareofferedbothprescriptionand overthecounter (OTC) medicines. Foods Business produced fruit juices, cooking pastes, sauces, and bulk items for institutional customers. The international business division manufacturedandmarketedproductsforoverseasmarkets. The company had eight manufacturing plants in India, organized around two main factories and six support factories, catering to consumer care and health care businesses. The foods business was catered to by two separate manufacturing facilities. The company also had production units outside India at Birganj (Nepal), Dhaka (Bangladesh), Dubai (UAE), Cairo (Egypt),andLagos(Nigeria). In India, Dewans product portfolio consisted of categories that were underpenetrated and highgrowth. The companys positioning on the health and wellness platform, backed by its differentiated herbal image, ensured that the company was well placed to capture future growthintheIndianCPGmarket.

APPROACHTOGLOBALIZATION Itwasin1987,withthesettingupofaplantinanexportprocessingzonenearNewDelhi,in north India, that Dewan began looking beyond Indian shores (see Exhibit 5). The initial momentum came from following its consumers the Indian Diaspora to the Persian Gulf regionoftheMiddleEast.IndianconsumerstherewerefamiliarwithDewanasabrandand preferreditstraditionalproducts.Overthenext10years,Dewanexportedprimarilyhairoilto theGulfmarkets,butdidnotyetconsideritsinternationalbusinessasafocussegment.Sales outsideIndiaaccountedforlessthansixpercentofturnover.Itwasfinallyin2003thatthe

SaidDuggal: Dewan is unique among its CPG peers in India in three ways. First, its products are derivatives of Ayurveda, an indigenous form of medicine. The raw materials are sourcedfromnaturalingredientssuchasherbs.Second,itsproductsarepricedforand targetedatthemassmarket.Finally,Dewanisoneofthefewheritagecompaniesin Indiathathassuccessfullytransitionedfrombeingafamilyruncompanytobeingfully managedbyprofessionals.
3

Whilethekeygrocer(arelativelylargemomandpopgrocerystore)wascomfortablewithtwosalesmen each visiting the store twice a week, the mass grocer (smaller grocery stores) managed with one visit per week,andthechemistwantedjustonevisitevery10days.Modernretailstores,ontheotherhand,required greaterfocusonanefficientsupplychain,replenishingproductswithaminimumtimelag.
3

Forexample,9,000wholesalersaccountingfor80percentofwholesalesaleshadsignedupfortheDewan Kingsprogram,resultingin20percentsalesgrowththroughwholesalers.
4

company articulated its vision of becoming "a financially successful and internationally respected corporation by occupying herbal, natural and ayurvedic platforms through successfulglobalization." DewanestablishedaDubaibasedsubsidiary,DIL,asanumbrellaorganizationtoprovidefocus and structure for its global operations. By 2006, the company had established five manufacturing units overseas. Its products were being exported to more than 50 countries aroundtheworld,includingtheMiddleEast,SoutheastAsia,Africa,theEuropeanUnionand America. These markets were serviced locally by the companys offices and representatives. Theinternationalbusinesscontributed11percentofconsolidatedsalesfortheperiod2005 06.Thecurrentgoalwastostepupinternationalsalesto20percentofrevenuesby2012,and thecompanyhadtakensomestrategicstepstowardsthatgoal. AllinternationaloperationshadbeenstreamlinedunderDIL,headedbyaCEO,andreporting to Duggal and headquartered in Dubai. DIL had seven subsidiaries: Dewan Nepal Pvt Ltd., Weikfield International (UAE) Ltd.; Asian Consumer Care Ltd.; African Consumer Care Ltd.; DewanEgyptLtd.;Dewan(UK)Ltd.;andAsianConsumerCare(Pakistan)Ltd.(seeExhibit6). Existing international markets were categorized into "strategic" and "opportunistic" markets in order of priority for allocation of managerial time. The strategic markets were further categorizedinto"focusmarkets"and"potentialmarkets"inorderofpriorityforallocationof financialandhumanresources(seeExhibit7). Dewanhasalreadyidentified20countriesinwhichtoestablishmanufacturingandmarketing facilities. These fell into two broad portfolios. The first comprised Asian markets (Pakistan, Bangladesh,Nepal,SriLankaandMalaysia)anddevelopedmarkets(UnitedStatesandUnited Kingdom).Also,partofthisfirstsetwouldbethehealthcarebusinessinCIS4countries,with Russiabeingthelargest.Thisportfoliowastobesupportedbythecompanysexportoriented unit in India and by the local manufacturing units in Nepal and Bangladesh. The second portfolioincludedmarketsinthemembercountriesofGulfCooperationCouncil(GCC),Africa (Egypt, Nigeria, Sudan and Morocco) other MiddleEastern countries like Iran and Iraq, and the personal care business in CIS countries. This was to be supported by manufacturing facilitiesinDubai,CairoandLagos.

financial investments and human resources in geographies designated as focus markets. Second, we will leverage the "natural" platform. DIL will capitalize on the growing global demandfornaturalproductsbyoccupyingdifferentiatedcompetitivenichesinthehealthcare and the personal care segments. And third, we will grow both organically and inorganically. Wewillacquireassetsanddrivealliancestobuildscaleglobally.

TEMPLATEFORGLOBALIZATION To achieve its goal of securing 20 per cent of its revenues from global operations by 2010, Dewan was designing a new template for international expansion. It had the following elements: Anewmarketforentryshouldnotbemargindilutive,evenintheshortrun. AnewmarketshouldbeinthelandscapebetweenNigeriaandChina.Anymarketbeyond thatlandscapewouldraise twobasicquestions:Isitadeveloped market?Isthecostof doingbusinesshigh?Iftheanswerwasyes,themarketwouldnotbepursued. Acquisition of brands, relationships and other assets would be considered to jump startgrowth. The technology on offer at the new geography should be compatible with Dewans technology.Therealsohadtobeopportunitiesforadaptingtechnologytosuitlocalneeds. The "herbal" platform would remain the basis for new customer acquisition and brand development. Theoverallbrandarchitecturewouldbelimitedtofourcorebrandsinanoverseasmarket.

Afocuscountrywastobesoidentifiedbasedonsomebasicconsiderations.Itshouldhavea large consumer population. The economy had to have longterm prospects for GDP growth. ThecountryshouldalreadyhavebeenplayinghosttoDewanbrands. Dewan was uncompromising in sticking to the above template. For example, in entering a "developed"marketliketheUnitedStates(normallyfacingeliminationinRound1itself),its foraywascautiousateachstage.Thebusinesshadtobemarginattractive.Thecompanyalso targetedthemainstreampopulationinthehostcountriesonlyaftergaininggroundwiththe localDiaspora.ThiswasparticularlytrueoftheMiddleEast.

SaidS.Raghunanandan,CEO,DIL: Thestrategicintentingrowingtheinternationalbusinessisthreefold.Thefirstisgeographic expansion.Wewillusethesegmentationmodeltoidentifythemarketsforentryandcommit

Duggal: Duringtheinitialdaysofourexportsales,wefollowedourtraditionalconsumers. But the Indian Diaspora, while important, is not our core international market in ourcurrentplans.Itspresencegivesusacomfortlevel,nodoubt,butisnolonger
6

CIS:TheCommonwealthofIndependentStatesisaregionalorganizationwhoseparticipatingcountriesare formerSovietRepublics,formedduringthebreakupoftheSovietUnion.
5

mandatoryformarketentry.IthinktheDiasporaisfinite.Thereisalsoalargegrey market operating in that segment, importing products directly from our Indian operations, without our approval through small retailers in foreign markets. Instead of the Diaspora, we are looking at the mainstream population in these countriesasourprospect. Basedontheabovetemplate,DILwasoperating,asofJune2007,aproductmatrixinitsfocus marketsasshowninExhibit8.

Soap: Consisting generally of creams, lotions, soaps and whitening products, the skincare category was highly competitive with a multitude of MNC and regional brands. Toilet soaps ruledthesoapssegmentwithabout75percentmarketshare.Medicatedsoapscompriseda growingsegment,offeringtherapeuticvalue,aimedattreatingailmentssuchaspricklyheat and rashes, and were often premium priced. There were MNCs like Reckitt Benckiser (with Dettol) in the medicated soaps segment and also local players, but that segment was less crowded in relation to toilet soaps. Dewan was trying to gain a foothold by building on the therapeuticplatform. Mosquitorepellant:ThiswasalsoacategorythatDewanhadenteredwiththeacquisitionof Balsara.TheproducthadwideappealintheNorthAfricanregion,whichwaspronetoMalaria. Coils, mats, sprays and vaporizers were the preferred product formats, dominated by MNCs likeReckittBenckiserandSCJohnson.Dewan,however,hadacreamoffering,whichwasnon existentinAfricawithnocompetition.Thisproductposedanopportunity.

GLOBALCONSUMERS Dewan had profiled three distinct segments of consumers outside India: Arab consumers, AsianconsumersandAfricanconsumers.Growthofeachsegmentwasdrivenbycoreproduct categories(seeExhibit9).

GLOBALCOMPETITION Hair oil: Multinational corporations (MNCs) were generally absent from the hair oil market, worldwide,becausetheypreferredtostayawayfromcommoditytradingandalsotofocuson the growing grooming segment. Dewan faced competition in hair oils, its flagship category, fromthreesources:peersinIndiaoperatingoverseas,localplayersandimports.Localplayers tendedtobemetoosandposedlittlethreat,asdidimports.CompanieslikeMaricoLtd.,an Indian competitor, were a major source of competition. In that sense, the competitive scenarioinhairoilsintheoverseasmarketwassimilartothehomemarketinIndia. Outsideofoils,Dewanfacedcompetitionineverycategoryinoverseasmarkets,largelyfrom MNCs. Shampoo: Dewans equity in the home market stemmed from the therapeutic value of its shampoos,basedontraditionalIndianingredients.Inanambienceinwhichcustomersveered intrinsically towards herbal ingredients, the company was able to hold its own in the Indian shampoomarket.ButthesituationinmarketsoutsideIndiawasdifferent.Ahaircareproduct wasbeautyrelatedandcosmeticinitsappeal.WhilethiswasabarrierforDewan,italsowas anopportunitytobuildanicheonitsuniquetherapeuticplatform. Toothpaste:MNCswereformidableplayersinoralcareproductsinoverseasmarkets.Dewan didnothavehomegrowncompetenciesinthecategory.ItwasonlywhenitacquiredBalsara HygieneProducts,anIndianCPGcompany,in2003thatitgainedentryintothiscategory.The integrationhadbeensuccessful,andDewanwaslaunchingMiswak,withtoothpastevariants and mouthwash, as a core brand in overseas markets. Miswak was pegged on an herbal platform,whichwaslesscrowded.
7

NIGERIA Nigeria was an example of an international market that had turned the spotlight on the debateaboutthemeritsofDewansglobalization.InvestorswereconcernedthattheNigerian marketwasnotdrawinguponcompetencies,builtnotonlyinthedomesticsettingbutevenin theexistinginternationalmarkets.Theirconcernsrestedontwogrounds:Dewanwasgoing beyondtheIndianDiaspora(acustomersegmentithadunderstoodbest)intothemainstream Africanpopulation(acustomersegmentitwasnotfamiliarwith).Anditwasbuildingamarket not on a category it understood best like personal care but on those in which it did not havetraditionalstrengths,likeoralcareandhomecare.

SaidRaghunandan: Nigeriaisalargemarketfortoothpastes,soaps,glucoseandmosquitorepellants, which are part of Dewans product portfolio. But in many ways, Nigeria has the makings of a new business, quite different from both domestic and international businesses of Dewan. All our focus markets are driven by hair care products, particularlyhairoil.Nigeriaisanexception.OralcareisthebusinessdriverforDIL in Nigeria. Toothpaste is not a focus product for Dewan in any international market.Nordoesthecompanyhavehomegrownstrengthsinthatcategory.Hair careproductssoldinNigeriaarecosmetic.Theydonothavetherapeuticvalue,in whichDewanscorecompetenceresides.Thereisdemandformosquitorepellants in Nigeria. But consumers are used to electrical coils, not creams, which are

Dewansforte.NigeriadoesnothavealargeIndianDiaspora,unliketheAsianand ArabmarketswhereDewanhasapresence.AllthesemakeNigeriaadifferentplay.

Exhibit3:DEWANINDIALTD.CONSOLIDATEDINCOMESTATEMENT

YearendingMarch31(inINRmillion) Incomesaleslessreturns Otherincome Totalincome Expenditure Costofmaterials Exciseduty Manufacturingexpenses Employeecosts Selling&administrativeexpenses Financialexpenses Miscellaneousexpenditurewrittenoff Depreciation TotalExpenditure ProfitBeforeTax ProfitAfterTax Salesbreakup Domestic International Total Marginbreakup Domestic International Total 2007 22,337 259 22,596 9,711 371 743 1,666 6,349 154 65 342 19,401 3,195 2,822 19,419 2,918 22,337 2,575 247 2,822 2006 18,996 134 19,130 8,078 337 571 1,449 5,652 164 43 269 16,563 2,567 2,266 16,835 2,161 18,996 2,080 186 2,266 2005 15,369 92 15,461 6,594 428 405 1,085 4,769 124 15 280 13,700 1,761 1,570 13,557 1,812 15,369 1,485 85 1,570 2004 13,295 91 13,386 5,814 654 347 915 3,973 153 39 248 12,143 1,241 11,946 1,349 13,295 2003 13,708 72 13,780 5,775 735 378 1,038 4,205 261 29 292 12,713 1,067 12,544 1,164 13,708

CertainissueswerethusuniquetoNigeria(seeExhibits10and11).CouldDewansuccessfully target an herbal niche in oral care and establish a strong market presence in toothpaste? Couldthecompanyoperateinskincaresuccessfullyandextendherbalequitytosoap?Could Dewanleverageitsstrengthsinhaircaretothecosmeticsegment?WouldDewanbeableto createanewcreamcategoryinNigeriainmosquitocoils?

Exhibit1:INDIANCPGTOP1020052006

Rank 1 2 3 4 5 6 7 8 9 10

Company HindustanLever ITC NestleIndia AsianPaints Nirma NirmaConsumerCare BritanniaIndustries DewanIndia Johnson&Johnson KansaiNerolacPaints

Netsales(INRmillion) 110,800 97,860 24,750 24,410 19,170 18,140 17,130 13,430 13,300 10,610

Exhibit2:DEWANINTERNATIONAL:SHAREOFREVENUESACROSSREGIONS

Focusregion GCCcountries Egypt Pakistan Bangladesh Nigeria US UK Others Total

%ofglobalrevenue 32 11 9 6 5 5 4 28 100

Thereisnoexhibit4
10

Exhibit5APPROACHTOGLOBALIZATION

Exhibit7:DEWANINTERNATIONALMARKETSEGMENTS

1987:SetupaunitinanExportProcessingZoneinnorthIndiatocatertoexportmarkets. 1990:OpenedwarehousingoperationsinLondontoserviceEuropeanmarkets. 1991: Set up Dewan Overseas Ltd. in Cayman Islands to facilitate overseas investment needs. 1993: Made an initial public officer (IPO) of INR 541.5 million to finance expansion and modernizationofmanufacturingfacilitiesanddevelopmentofnewfacilities. 1993: Enlisted AF Ferguson for advice on restructuring. Based on its recommendations, regroupedintosevenprofitcenters.Broughtinprofessionalstoheadunitsandfunctions. 1997:HiredMcKinsey&Companyforadviceonstrengtheningcompetitiveposition. 1998:BurmanfamilystepsasidetohandovermanagementtoaprofessionalCEO 1999:ImplementedarestructuringtemplatepreparedbyMcKinsey.Withdrewfromlow marginbusinesseslikemerchantexports,veterinarydrugsandherbalintermediates. 2002:CommissionedAccenturetoreviewsalesanddistributionsystem.Demerged,asper its recommendations, the Pharmaceutical business to get a renewed focus on CPG business. 2003:Relookedatstrategywithaglobalperspective.Decidedtoleverageherbalplatform in entering new markets. Created Dewan International Limited, based at Dubai, as an umbrellaorganizationtoprovidefocusandstructureforglobaloperations. 2006: By end2006, Dewan had established five manufacturing units overseas. International business contributed 11 per cent of sales for the period 200506. The new goal:Internationalbusinessshouldcontribute20percenttotherevenuesby2012.

STRATEGICMARKETS

FOCUSMARKETS POTENTIALMARKETS GCCEgyptNigeria MoroccoSudanLibya BangladeshPakistanand IraqYemenKenya Nepal SyriaJordanMalaysia Geographies U.S.A.(forhealthcareproductsand U.K.(forhealthcare Anyothermarketasand privatelabelsonly) productsandprivate whenavailable labelsonly) *Shouldhavethepoten *Minimumresources *AbilitytomobilizeINR500 tialtobeupgradedintoa wouldbedeployed millioninsalesby200910 *Topmanagement focusmarketin3years *Tobedesignatedasaprofit *DewanInternationalwill team centerwithitsownsalesand atDewanInternational distributionand,wherelocallaws notimmediatelyinvest willnotspendtimeon financialresourcesin permit,itsownmanufacturing Attributes thesemarkets potentialmarkets *Provisionforlocalizationof *Needtobemargins *Productswillnotbe productsfromIndia localizedtillthemarketis positive *DewanInternationalallocate upgradedtoFocus financialresourcesandteams *PotentialMarketswould *Focusmarketswouldbe be'MindShareIntensive 'Implementationintensive Acceptorders Mandate InvestandGrow Monitorforupgrade selectively Growthin2006 34 12 50 Revenuesharetarget(%) 80 15 5

OPPORTUNISTIC MARKETS CanadaAfghanistan MauritiusThailand

Exhibit8:PRODUCTMATRIXIN(AFEW)FOCUSMARKETS

Product Hairoil Haircream Shampoo Ayurvedic Digestives Soap Toothpaste Insectrepellant Toiletcleaners

Exhibit6:DewanInternationalSubsidiaries

Dewan NepalPvt Ltd Nepal 49.9 49.9 2198 1948

Weikfield Asian African DewanEgypt DewanUK AsianCon Intl. Consumer Consumer sumerCare Ltd Ltd (Pak)Ltd (UAE)Ltd CareLtd CareLtd Dubai Bangladesh Taka 18.9 19.4 9.7 9.5 Nigeria Egypt UK GBR NA Pakistan PakistanRp NigerianNira EgyptPound

Country Currency Financials (inINRmillion) Capital Reserves Sales ProfitPretax ProfitPosttax

GCC Focus product Focus product Support product Support product

Egypt Focus product Focus product Support product Support product Support product

Nigeria Focus product Focus product Focus product


12

Country Bangladesh Focus product Support product Support product Support product Focus product

Pakistan Focus product Focus product Support product Support product Focus product

U.S.A. Focus product

NepaleseRpUAEDirham

2007 2006 2007 2006 2007 2006 2007 2006 2007 2006 2007 20062007 2006 15.4 15.9 22.8 23.4 21.7 NA 6.7 3.0 (13) 132 8.5 (0.6) 8.5 (0.6) 24.7 1972 32.5 24.8 91 80 206 646.3 598.0 27.8 42.4(16.1) (9.3) (30.4) (13.6) 36.0 387 334 135 144 67.8 60.4 (12.3)(3.1) (9.7) (5.6) (16.1)(10.5) 32.2 53.2 49.8 (12.3)(3.1) (9.7) (5.6) (16.1) (10.5) 32.2

11

Exhibit9:DEWANINTERNATIONALCONSUMERSEGMENTS

Exhibit11:NIGERIABUSINESSRISKPROFILE
Africanconsumer East,WestandSouthAfrica Africanmale&female OralCare PersonalWash HomeCare(Insect repellent) Nigeria 320 CentralAfrica10 EastAfrica60 SouthAfrica10 WestAfrica240 Highoralcare penetration Englishspeaking Mediumcompetitive intensity

Footprints Targetcustomer Corecategories

Arabconsumer MiddleEast&NorthAfrica Arabfemale HairOils HairCreams Shampoos Oralcare Dubai 1,340 GCC760 NorthAfrica460 Iran,60;Iraq,60 80percentofthe populationisArabic Highpurchasingpower

Asianconsumer SouthAsia Asianmale HairOils Shampoos Digestives Oralcare India 1,500 Pakistan440 Nepal640 Bangladesh200 UAE210 ReplicatingIndian brandarchitectureand productportfolio Leveraginglearning fromIndianmarketing mixandmediastrategy

Marketsize (INRmillion) Products OralCare Rural:2,000 Urban:3,000 Toothpaste SkinCare 6,000 Soap HairCare NA HealthCare 350 HomeCare NA

Coremarket Marketsize (inINRmillion) Supplymarketsand marketsizes(inINR million)

Keymarket attributes

Exhibit10:NIGERIACOUNTRYRISKPROFILE;Population:130millionofwhich60percent belowpovertylineGDPpercapita US$450perannum

Riskassessment Marketrisk Supplierrisk Competitorrisk Implementationrisk Political&Economic Regulatory Financial

Probabilityof risk Low Low High High High Low Medium

Impactofrisk High Medium High High High Medium High

Overallrisk (Probability+Impact) Medium Low High High High Low Medium

Mosquito repellant cream Comp.intensity LowMedium LowMedium LowMedium Low Low Strategicintent Tobecomethe Tobecomethe Tocreatea Tobecomea Toreplicate secondlargest thirdlargest marketforhair strongplayer theIndian player playerinsoaps oils inglucose product market portfolio Imperatives LaunchDewanLeverage Becomea Launchaherbal Glucose India leaderin soapwith competency herbalniche localized ingredients Launch Odomos Launch cream herbalgel Strategic Soap Unilever Haircareis Aoneplayer Coilisthe predominant market andP&G beautyrelated play issues productform. strong fragmented andcosmetic Nomarket Unilever Dewanhas forcream andP&Gstrong therapeutic Herbal andnot nichenot Small cosmetic crowded playersand importshave> equity 50%market share Soapisnot acorecategory forDewan Challenge CanDewan CanDewan CanDewan CanDewan Should successfully operateinsoap leverageits becomeNo.2 Dewancreate targetherbal successfully? strengths? player? anewcream nicheand Canitextend categoryin establisha herbalequityto Nigeria? strongmarket soap? presence?

RelaxersHair Glucose pomade

13

14