Riding on the proposed investment by salt-to-cigarettes conglomerate ITC Ltd., baby care start-up Mother Sparsh is aiming to grow its business exponentially in next five years. The company, which had an annual sales of Rs 15 crore last year (FY2021), has set an ambitious target of touching Rs 300 crore annual sales by 2026.
Recently, Kolkata-based ITC announced its plans on acquiring a 16 per cent stake in the Chandigarh-based premium ayurvedic personal care company at a valuation of Rs 125 crore. The conglomerate, that is rapidly expanding its presence in the fast moving consumer goods space, is picking up the stake to grow its presence in the direct-to-consumer (D2C) space. According to Sameer Satpathy, Chief Executive of Personal Care Products Business at ITC, the deal will help grow ITC’s “play both in the naturals and ayurvedic segment as well as in the D2C channel”.
Himanshu Gandhi, who co-founded Mother Sparsh with his wife Rishu in 2016, says, ITC’s investment will boost its fortunes in coming years. Apart from investing the money into new product development and innovations, it will also help in expanding the brands presence across the country’s smaller towns.
Currently, it sells its products through in-house e-commerce portal and the likes of Flipkart and Amazon, primarily to metro city customers. Its offline sales is merely at 5-7 per cent. However, now with ITC’s distribution might behind it Mother Sparsh has the potential to grow faster.
According to Gandhi, the company is already set to grow its top-line by 167 per cent in FY2022 to Rs 40 crore. He is now looking to touch Rs 100 crore mark by the end of next financial year.
In its five years journey so far, this is the first time that the company received investment from a professional group. Since its inception, the business was funded by the two co-founders and their personal contacts. To keep its costs in check, Mother Sparsh stayed away from conventional promotional methods like television advertising as it would have been “too costly” for the newly founded venture. Instead, Gandhi relied on digital media and word-of-mouth publicity. Thus, apart from a few Bollywood celebrities like Neena Gupta and Tisca Chopra, it has lined up an army of some 10,000 social media influencers.
The strategy is simple: to impress upon new mothers with its quality and maintain the quality and supply intact. Unlike other personal care categories, acquiring a customer once means “a lifelong attachment”, he says. As parents, especially mothers, once hooked to a brand and issued by its quality, do not switch brands.
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