Baba Ramdev's Patanjali riding high on soaps and shampoos

Baba Ramdev's Patanjali, which is giving big multinational companies a run for their money in the fast moving consumer goods segment, is making maximum profit on soaps and shampoos, according to the yoga guru's aide and CEO of the company Acharya Balkrishna.

"Food items such as flour and pulses are a game of volumes. Profit usually ranges from two per cent to 20 per cent. Highest profit is on items such as soaps and shampoos. On average you can say we make 10 per cent profit on our products," Balkrishna told Business Today in an interview.

Patanjali sells a range of products including soaps, toothpaste, shampoos, detergent powder and many food items such as rice, flour, pulses and edible oils among other items.

In the interview, Balkrishna  said the price at which Patanjali sells its products benefits customers and also forces MNCs to reduce the prices of their products.

"The right price is a direct benefit to consumers. There are also indirect benefits. Big MNCs that are well-established have reduced prices of some of their products and have started giving more offers," he said.
Patanjali's shot to fame was not only quick but continues to be a threat to a few major names in the industry, especially the ones that sell organic and herbal products.

When asked about the profit margin compared to other brands, Balkrishna said Baba Ramdev, who is the co-founder and the face of the company, does not believe in making profit on everything.

"Swamiji doesn't believe in making profit on everything. Some of our products are sold at par, some even at a loss. One of the products that we sell at a loss is our ayurvedic chai. It is sold at a loss because our karyakartas drink it and it is in high demand in villages," he said.

Recent reports suggest that the company founded by Baba Ramdev, has shown a promising growth pattern in a short period of just one year.

The overall growth of Indian FMCGs have also grown in the year. FY 16 registered a total of $9,436.66 million, whereas the combined revenue of selected seven Indian FMCG is $11,066.46 million.