Hindustan Unilever (HUL) Acquisition of two digital-first brands — OZiva and Wellbeing Nutrition — In line with the premiumization trend as more FMCG players embarked on high growth. Health and nutrition categoriesis gaining traction among consumers in a post-pandemic world.
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Details of this acquisition:
The move will be in line with the trend of larger FMCG players investing. Direct to consumer (D2C) Indian brands because companies do not want to miss out on the growing online shopper market. Marico acquired his 54% stake in True Elements, another healthy snack and breakfast brand, and HUL himself also owns his own beauty and health brands, including Dove Baby, Love Beauty and Planet, Simple and Dermalogica. Launched a personal care brand.Nestle India and From cigarettes to daily consumer goods manufacturer ITC It is said to be interested in investing in Yoga Bar’s parent company, Sprout Life Foods.
Significance of this move:
in a rapidly growing category H&W potential market size is Rs 3 lakh In the next 4-5 years. While there are several demand spaces in this category, HUL plans to focus on high-growth areas such as sleep and stress, women’s health, gut health, beauty from within, and plant-based products.
Analyst Comment:
These categories target higher-income cohorts and benefit from increased affluencesaid a Jefferies analyst.
“Both of these D2C premium brand We provide the right consumer cohort for millennials, especially Gen Z, to complement their changing consumer preferences,” said an analyst at Nuvama Institutional Equities.
About The OZiva and Wellbeing’s recent performance:
OZiva and Wellbeing have an annual run rate 100 million rupees and 500 million rupees, Respectively. Additionally, gross margins for both acquisitions are approximately 55%, higher than HUL’s existing business.
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