Chairman's Message

Signature

Mr. Amit Burman

Dear Shareholders

Let me begin by wishing all of you good health and safety in these challenging times The second wave of Covid has affected us all in some way or the other. My heart goes out to the families and friends of all those who have lost their loved ones or are struggling with health issues due to this pandemic. I would also like to place on record my appreciation of the entire Dabur family who have risen to meet the challenges which this pandemic threw up over the year. On behalf of the Board of Directors of Dabur India Ltd, I thank them for taking their dedication to new heights this past year as they worked towards meeting and overcoming the challenges and ensured uninterrupted supply of our products to millions of consumers when they needed them the most. I would also like to take this opportunity to express my immense gratitude to all our frontline heroes - police personnel, doctors, health workers and sanitation workers - for their efforts in keeping all of us safe during these uncertain times.

Despite facing multiple headwinds Dabur India Ltd delivered a robust performance in 2020-21 with 10% growth in Consolidated Revenue from Operations, touching 9,562 Crore. Consolidated Net Profit for FY 2020-21 stood at 1,693 Crore, a 17.2% jump over the previous year. Our India FMCG Business led the growth with a 15% surge, with underlying Volume Growth of 12.5% in FY 2020-21.

After the initial period of disruption in first quarter of FY2020-21, the Company made a good recovery led by Healthcare business which saw a huge tailwind with the growing consumer demand for Ayurvedic immunity-building products. Oral Care business continued to be an outperformer all through the year. The latter half of the year also saw a smart turnaround by our Foods and Home and Personal Care categories. Among the channels, E-commerce continues to be a key growth driver and now contributes to around 6% of our domestic Sales up from 2.4% in the previous year. Details of our category-wise performance have been shared in the MDA section of this report.

Building a Resilient Enterprise

The significantly strengthened performance that Dabur reported in a COVID year comes from the high degree of resilience that we built into our business through a series of consumer-centric and tactical innovations coupled with investments in adding capacity for our immunity-building portfolio of Ayurvedic medicines and products. Our diversified portfolio and our strong financial position helped us successfully navigate the uncharted waters of the pandemic and emerge stronger.

COVID presented significant challenges for our people and our business. To succeed in this uncertain and highly dynamic environment, we needed to be agile and seize opportunities in a very short timeframe. We quickly adapted our business approach, mobilised our teams to put in a strong effort despite lockdown restrictions, besides leveraging technology and innovation to address the changing environment and the emerging needs of our consumers.

Even in a grim COVID year, Dabur crossed several milestones:

  • Our Gross Sales topped 10,000 Crore for the first time.
  • Our Operating Profit exceeded 2,000 crore.
  • One of our youngest and flagship Power Brands Dabur Red Paste touched the 1,000 crore mark.
  • We added 500 Crore turnover to the Health Supplements portfolio, which includes iconic brands like Dabur Honey and Dabur Chyawanprash.
  • Our Market Capitalisation touched the One Trillion mark.

COVID presented significant challenges for our people and our business. To succeed in this uncertain and highly dynamic environment, we needed to be agile and seize opportunities in a very short timeframe. We quickly adapted our business approach, mobilised our teams to put in a strong effort despite lockdown restrictions, besides leveraging technology and innovation to address the changing environment and the emerging needs of our consumers.

Protecting Our Extended Family

The emergence of the second and more devastating wave of the pandemic in March 2021 tested the character of the organization all over again. As we stayed true to our Ayurvedic roots while working tirelessly towards serving all our stakeholders, the health and safety of our employees remained paramount. We rolled out a series of initiatives across our operations to prevent the spread of infection. Despite our best efforts, we had to face a few casualties with a couple of our employees succumbing to COVID. Dabur has decided to support their family with continued monthly salary for one year, in addition to the term Insurance cover provided by the Company. While we understand that this can in no way make up for the loss, we feel this small gesture would help support the family through this tough period.

We also rolled out a series of measures to protect employees at our stockists and CFAs, while stepping up our efforts to serve the community. Dabur donated millions of face masks, sanitizers and other critical material to local COVID isolation centres and frontline workers besides investing in Oxygen Generation units to meet the growing need for this vital life support system. Details of our various initiatives towards fighting the pandemic have been shared in the Capitals section of this report.

Reset and Respond

The Company showed a high degree of flexibility and engagement, quickly adapting to the changing environment and operating conditions. We quickly reopened our operations after the initial shutdown and remained focused on strategic development of core businesses. We sharpened our focus on our Power Brands and the Ayurvedic Healthcare portfolio, besides building increased flexibility into our planning and Go-to-Market strategies to drive profitable growth. The Company invested strongly behind its brands and increased the spends on digital and other media channels to enhance the visibility of our products. These strategies paid off with our Power Brands growing ahead of other brands and the business reported strong gains in market share across the portfolio.

We also continued to expand our distribution footprint, particularly in the hinterland, taking up our village coverage to 59,217 villages by the end of March 2021. We will be expanding this coverage to 80,000 villages in the next 2 years.

We have also embarked on an ambitious new initiative ‘Dabur Yoddha’ to further reinforce its rural presence, which also seeks to provide sustainable livelihood to the rural folks by appointing them as our local sales representatives in their respective villages. Details of this initiative has been presented on the MDA section of this report.

The year also saw our Chemist coverage increase by around 17,000 outlets to take the total reach to over 2.58 lakh outlets. Our direct retail coverage expanded to 1.3 million outlets and we plan to take it up to 1.4 million outlets in the 2021-22 fiscal.

Our International business was impacted due to Covid in the first half of the year. However the business made a good recovery during the second half with most countries coming back to good growth driven by consumer connect initiatives, cost efficiencies and innovation. We will continue to leverage our brand strength, herbal and natural proposition, consumerrelevant innovations and unmatched product portfolio to generate strong profitable growth in our international business.

Advancing Sustainability

In my letter to you last year, I had laid out our longstanding commitment to ESG initiatives. Despite the challenges brought about by the COVID pandemic and the resultant nationwide lockdown, I am happy to report that we have moved forward on these commitments. We implemented a series of measures both within and outside our gates to reduce the impact of our business on the environment and also support sustainable development of communities. We moved ahead with our Plastic Waste Management initiative, collecting and processing/recycling over 11,000 MT of post-consumer plastic waste during the year. Special initiatives were also rolled out to clean our oceans and our cities, details of which have been shared in the Natural Capitals section of this report.

Future Outlook

While we will remember 2020-21 for the significant challenges the year presented in the form of COVID-19, the fact remains that the pandemic is far from over. With the emergence of the second wave and talks of another wave likely in the future, we might have to cope with the related challenges in the months to come.

That said, we are better prepared to handle the pandemic as compared to last year. We are also applying learnings from last year on streamlining the supply chain to ensure minimal disruption in availability of our products. While this remains a developing situation, our factories continue to operate on a relatively normal basis. We are also encouraged by the strong consumer demand trends for Ayurvedic Healthcare products and medicines, which is expected to make up for any loss in the discretionary products business in case the wave worsens.

I am confident that Dabur is well positioned to meet the challenges ahead and generate sustainable long-term growth.

As we finish this period with a strong set of results, I would like to take this opportunity to thank all our colleagues once again. Dabur’s resilience in these challenging times is a testament to their dedication and commitment. I would also like to thank my fellow directors for their valuable guidance and support to the business. Finally, let me close by thanking all our shareholders, investors, business associates and consumers for the trust and confidence they have placed upon us. I look forward to your support in our endeavour to continue delivering value for all our stakeholders over the coming years.

Stay Safe and Thank You

Sincerely,
AMIT BURMAN
CHAIRMAN

download-pdfAnnual Report 2020-21