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Godrej & Boyce Expects Double-Digit Growth In Healthcare Biz Going Ahead
The healthcare sector's revenues contribute less than 10 per cent of Godrej & Boyce's total revenues. However, we believe that this sector presents strong growth opportunities even after the pandemic ebbs
Photo Credit : Bloomberg
Consumer goods firm Godrej & Boyce is looking at double-digit growth in its healthcare business going forward, and after the pandemic started in March 2020, it has witnessed a sustained rising demand of its key healthcare products and solutions, said a top company official.
Besides, Godrej & Boyce, part of over USD 4.1-billion Godrej Group and a leading maker of medical refrigerators in India, is also quite open to alliance with any vaccine makers such as Pfizer's, that needs to be kept in (-) 70 degrees Celsius.
The company's healthcare businesses are growing in the range of 22-25 per cent in the past year, said Godrej & Boyce Executive Director Nyrika Holkar.
Godrej & Boyce is operating in the healthcare sector through its multiple step-down subsidiaries, which include Godrej Appliances, Godrej Interio and Godrej Lawkim, in areas such as hospital beds, medical refrigerators and calibration services for medical equipment like ventilators.
'We believe that the healthcare sector present opportunities for y-o-y double-digit growth for the foreseeable future. India's need to bolster and expand its healthcare infrastructure is urgent and compelling,' Holkar told PTI.
Since March 2020, when the pandemic started, it has witnessed 'sustained rising demand' for many of its key healthcare products and solutions.
'Currently, the healthcare sector's revenues contribute less than 10 per cent of Godrej & Boyce's total revenues. However, we believe that this sector presents strong growth opportunities even after the pandemic ebbs,' she added.
Godrej & Boyce has not shared its revenue from its healthcare sector business.
The company is sensing great opportunity by the government plan to strengthen the medical cold supply chain.
'Take, for example, the need to strengthen our medical cold supply chain. While vaccine fridges are the immediate need, the government has also announced plans to create 65 new blood banks at the district level,' Holkar said.
Such precise cooling solutions are also critical for organ storage banks and pharma cold chains including testing labs, she added.
'With Godrej & Boyce's technology and engineering capabilities as well as a range of suitable products, we plan to play a significant role in these areas,' she added.
On being asked as to whether Godrej & Boyce is open to working with COVID-19 vaccine makers such as Pfizer, Holkar said, 'As an organisation, we believe in strong partnerships and collaborations.' The company, in partnership with the UK-based The Sure Chill Company, sells medical refrigerators that use the properties of water to keep vaccines in the desired temperature range.
'Now, as procurement of vaccinations has been opened up for private sector corporations and hospitals, we are also looking at partnerships and collaborations in this regard,' she added.
When asked about the local value addition of the products sold into the healthcare sector, Holkar said, 'Around 90 per cent of the products that Godrej & Boyce sells in the healthcare sector are through local value addition.' 'As an organisation, we are committed to a self-reliant India. Keeping that in mind, we are constantly working towards increasing this ratio through local manufacturing, sourcing and collaborations,' she added.
Last year, for instance, Godrej & Boyce has invested 10 per cent of its healthcare revenues back into the business.
'At Godrej & Boyce, investment is a continuous process and we are continuously scanning the horizon to scout for investment opportunities for our businesses,' she said.
In the past 14 months, it has built a new manufacturing plant for Godrej Interio at Khalapur, Maharashtra, with a production capacity of 300 hospital beds per day among other healthcare accessories.
'Similarly, in FY20, Godrej Appliances increased its manufacturing capacity by 300 per cent by making investments in foaming plugs, jigs and conveyor lines. Even at component levels, multiple tools were developed to match plant production capacity,' said Holkar.
Godrej & Boyce also exports its medical refrigerators to over 36 countries covering Africa, the Middle East and SAARC and will continue to focus on these regions.
However, currently, most of its healthcare products and solutions are focused towards the Indian healthcare industry.
'Even after the COVID-19 era, there is an immense potential to further upgrade the healthcare infrastructure in order to bolster India's immunisation drive. Having said that, the international markets too offer significant opportunity,' she said.
Holkar also said, 'Going forward, we see an opportunity to step up our exports even further.'