ITC enters hand sanitiser category, plans to turn Savlon into Rs 500 crore brand

ITC’s decision to enter the sanitiser category follows the company’s decision to turn Savlon, which it acquired in 2015. Photo: Reuters

New Delhi: Fast moving consumer goods firm ITC Ltd has entered the hand sanitiser segment with the launch of Savlon pen sanitizer spray. The move augments the company’s hygiene portfolio, which currently has antiseptic liquid, hand wash and soap.

It also pits the brand Savlon against the RB India-owned hygiene brand Dettol, which leads the hand hygiene market, followed by the Hindustan Unilever-owned Lifebuoy and Godrej Consumer Products Ltd’s brand Protekt, which also sells sanitisers.

While the health and hygiene category, especially hand hygiene, has seen steep growth, given increasing hygiene awareness in the country, the hand sanitizer category, growing at 21%, year on year, is still underpenetrated and is largely urban.

The antiseptic liquid (Rs 650 crore) and hand wash (Rs. 600 crore) category size is much bigger than the sanitizer category, which is pegged at Rs 70-80 crore, according to data from market research firm Nielsen.

“The rising number of urban commuters has led to an increase in the need for out-of-home hygiene solutions such as hand sanitisers. Since our primary target group is kids, we have created the product in a pen format, which can fit inside a pencil box. The spray bottle also allows dosage control and reduces product wastage,” said Sameer Satpathy, chief executive, personal care, ITC Ltd.

The product will be available in a small pen format priced at Rs 49 for a 9 ml bottle promising 100 sprays. The 55 ml bottle is priced at Rs 77. ITC’s decision to enter the sanitiser category follows the company’s decision to turn Savlon, which it acquired from Johnson & Johnson in 2015, into a Rs 500 crore brand.

ITC repositioned the brand and enhanced its focus on the hand hygiene category. Savlon hand wash was launched in 2016 and the company claims that it currently has a value share of 7-8% in the segment. ITC is now looking at investing further in the brand and driving growth through product innovations.

“Savlon is a strong health and hygiene brand. We expect to outgrow the category with innovative product solutions, leveraging our strengths in brand building and distribution. The phenomenal growth of the brand since its acquisition is testimony to our commitment to create value for the Indian consumer,” said Satpathy.

Noting that the hand hygiene category has strong players such as Dettol and Lifebuoy, Abneesh Roy, senior vice-president at Edelweiss Securities, said only product innovation would help new launches to take market share from existing players.

“Savlon’s product format seems interesting, especially for kids. While I think the price point (Rs 49) is slightly on the higher side, the promise of 100 sprays will help the product. I believe deodorant brand Fogg also gained market share by the promise of a certain number of sprays and a no-gas proposition,” he said.

Roy said that the brand Savlon had also been under-advertised when it was with (J&J), and ITC was now investing heavily in marketing and promotions, which would help the brand.

“Along with their large distribution network, as well as investment in advertising and hygiene awareness programmes, the Savlon brand will grow. Therefore, the Rs 500 crore target looks achievable in the next five years,” he added.