Pidilite Industries is considering spinning off its
manufacturing facilities to a new company with a joint venture partner. And it will will
rely more on outsourcing the manufacture of its products and selling them through its 3
lakh strong dealer network spanning more than 3,000 towns.
Pidilite will also sell off its synthetic resin and
pigment business, for which it has appointed DSP Merill Lynch as advisor.
B K Parekh, chairman, Pidilite Industries, has said that
Pidilite will become a consumer products company, and expand through the acquisition of
brands. It has already started the process by buying the ''Ranipal'' brand from Indian
Dyestuff Industries for about Rs.4 crore.
Currently, Pidilite has about 40 brands covering 400
industrial and consumer products in its portfolio. The flagship brand is Fevicol. Some of
its other brands are Fevikwik, Fevistik, Acron, Wudfin, Fevibonds and so on.
The company claims that the ''Fevicol'' brand has a market
share of 65 per cent in the consumer adhesives market. It has been in existence since 1959
and carries a strong brand equity.
The company''s exports have grown from Rs.11.3 crore in the
financial year 1994-95 to Rs.30.82 crore in 1998-99, which is 9.3 per cent of the
company''s net sales. Pidilite exports to Sri Lanka, Australia, the Middle East and Europe.
Pidilite is one of the Indian companies that has furnished
the economic value
added data in its balance sheets. Its EVA has risen to Rs.12.74 crore in 1998-99 from
Rs.59 lakh in 1996-97. The company''s net worth has grown from Rs.60.7 crore in
1994-95 to Rs.134.87 crore in 1998-99. The promoters'' holding in the company is about 72