Emami to Build Its First Overseas Plants in Egypt, Bangladesh, Goenka Says
Emami Ltd., an Indian maker of health-care products endorsed by Bollywood actor Amitabh Bachchan, will build its first overseas factories in Egypt and Bangladesh to meet demand for soaps, ointments and creams.
The company based in Kolkata plans to spend 350 million rupees ($7.6 million) on the new plants, said Executive Director Mohan Goenka.
“Demand in the eastern African region and Bangladesh is growing,” Goenka said in a phone interview yesterday. “The units there will help us in meeting the requirement.”
Indian companies including Emami, Bharti Airtel Ltd. and Bajaj Auto Ltd. are expanding in emerging nations in Africa and Asia as economic growth boosts demand for products from motorcycles to mobile-phone services. The International Monetary Fund forecasts developing Asia to expand 8.5 percent. Egypt, the most populous Arab nation, expanded 5.9 percent in the three months to June 30.
“Having plants there will increase the penetration of their international business, which is a significant part of their overall business,” said Shirish Pardeshi, an analyst with Anand Rathi Financial Services Ltd. “The company will be able to give services faster.”
The company earned 15 percent of its revenue from exporting its hair oil, soaps and Boroplus antiseptic cream in the three months ended June 30, Pardeshi said.
Emami’s shares, which have risen 95 percent this year, advanced 3.8 percent to 475.05 rupees in Mumbai yesterday. The benchmark Sensex Index gained 1.2 percent yesterday.
The company, whose products are also endorsed by cricket’s highest scorer Sachin Tendulkar, isn’t in discussions to buy a health-care company, he said denying a July 20 Hindu Business Line report.
Bharti Airtel, India’s biggest mobile-phone company, in June spent $9 billion to acquire the African assets of Kuwait’s Mobile Telecommunications Co. Bajaj Auto, India’s second-largest motorcycle maker, aims to triple global market share to 30 percent by expanding in Asia, Africa and Latin America.