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Tuesday, November 21, 2006

Cholayil likely to raise funds in two years

Personal care products company Cholayil is likely to go in for external funding within two years, reports Business Standard.

Managing Director V S Pradeep said, “At present, we do not have external funding. We are open to other avenues of fund raising as we go along.” The company has not ruled out a private placement or a public issue.

The Rs 750 crore company, which has brands such as Cuticura and Medimix, has been pushing its brands aggressively over the past months and expects the brands to grow rapidly over the next few years.

Pradeep said while the expansion would require additional funding soon, it was too early to comment on how much the company would be looking to raising. Over the next fiscal, the company would be merging its group company Dorcas Market Makers, DMM. Pradeep said the company had initially set up DMM as a separate marketing arm, for group brands as well as other brands.

“The rationale for setting up a separate entity earlier was that we were looking at distribution operations for other manufacturers in South India where we have strong distribution advantages,” he said.

In 2002, the company was distributing Sunfill, the soft drink concentrate from Coca Cola. But, its plans to turn into a full-fledged distributor didn’t take off and DMM ended up marketing only the group brands, hence, the decision to merge the company with itself.

Cholayil is also finalising plans to enter the men’s grooming segment. Hair care is another area the company is looking at.

Recently, Cholayil had launched the Cuticura deodorant and has further extensions lined up under the brand. Similarly, it is looking at widening its portfolio of ayurvedic products under the Medimix brand.

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