Amrutanjan Health Care, a maker of ayurvedic over the counter medicines, has diversified into foods. It is buying out Siva’s Soft Drink Pvt Ltd, a Chennai-based company which sells fruit juices under the Fruitnik brand.
Amrutanjan sells OTC medicines which cater to pain management (such as headaches and body aches), cold and cough medicines and health and home (corn caps and hand sanitizers). Its flagship product is the Amrutanjan Pain Balm, and it has added several products under this umbrella brand over the years.
It is paying Rs 26 crore to acquire Fruitnik, though more financial details about the company have not been given. Its website says that it was the first pulp-based fruit drink to be launched in Southern India, and was launched in 1958. It sells juices in the mango, grape and apple flavours. Its website says it is also rapidly expanding across India.
Amrutanjan will not be the first company to enter the fruit juices market, with Dabur India being the other company which is known for its ayurvedic medicines. Dabur sells fruit juices under the Real brand in India. The logic of an ayurvedic company selling fruit juices seems a bit strange. One reason could be that consumers know the company already since these are OTC products, and they are associated with health, and fruit juices are seen as a healthier alternatitve to aerated drinks.
Dabur is the largest player with a market share of about 52%, followed by Pepsico Foods with its Tropicana range and a market share of 35%, and then there are other players such as Priya Gold. It is a fairly large market, and based on Dabur’s foods’ business revenues of about Rs 370 crore, its size works out to approximately Rs 740 crore, in terms of company-level revenues. The actual market size will be higher as it will include the retailer and distributor margins.
Update: At 11.45AM, Amrutanjan’s share price was up by 3% at Rs 597.