June 9: Consumer goods Emami has recently increased its product prices by 4% on average during this financial year. This came as a move to retain its profit margin and has launched rural expansion project Khoj in Uttar Pradesh.
ET Bureau reported that Emami has spiked its prices across numerous product categories in order to offset the business’ current input cost pressure. With this move, Emami aims to retain the brand’s gross margin between 66% and 67% during the current financial year.
The fast-moving consumer goods brand has also launched a new project Khoj designed to increase its penetration of the rural market and contribute towards the profitability momentum in Uttar Pradesh.
However, the project was delayed due to Covid-19 and the brand aims to launch the project in Bihar, Maharashtra, and Andhra Pradesh as a part of its first leg of the roll-out.
As reported by the Press Trust of India, Emami’s director Mohan Goenka, “We have a price hike of 4% so far and this will take care of our existing cost pressure as of now. We will decide accordingly depending upon the situation going forward. With the price rise, we do not foresee any pressure on gross and EBITA margins as of now.”
Further, while explaining the move, Goenka quoted, “Project Khoj is a rural project where we have identified 13 states where we would go very deep into 3,000 population villages, but we would start with only four high potential states as of now. We have just begun our journey with unlocking taking place.”