Personal care player, Nivea India Pvt Ltd, an affiliate of German cosmetic major Beiersdorf, on Monday initiated construction work for its greenfield facility at Sanand near Ahmedabad, making it the company’s first plant in India.
The facility, being set up at a cost of Rs 1,000 crore, will also have a research and development (R&D) centre for product development and innovation in packaging to make the product more economical, senior company officials said here during the ground-breaking ceremony of the plant. The plant is scheduled to be ready by March 2015.
“An important aspect of the plant is the R&D centre. This is the only R&D centre of the company in the entire SAARC region,” said Stefan De Loecker, corporate senior Vice-President, Near East Region, Beiersdorf.
“The R&D centre will focus on establishing products according to the needs of the Indian consumers. Secondly, it will be used for innovation in packaging so as to make it more economical,” he added.
Nivea sells around 50 million units of its different products every year in India. The company has to import nearly 50-60 per cent of its total requirements and some of its requirement is met through outsourced production. The new plant would help the company reduce its imports by half.
“Accordingly, the prices of products will also get more attractive and affordable,” said Rakshit Hargave, Managing Director, Nivea India.
The company will focus on three product categories, body lotion, deo sprays and the men’s category. “In the past 12-18 months, the overall personal care market has been suppressed with growth of around 10 per cent in the overall toiletries segment. But we have outperformed the market trend and expect to continue the same in the coming years,” said Hargave.
The company has 10-12 manufacturing facilities located globally, mainly in Latin America, Europe and South-East Asia. Of these, five facilities are located in Asia. Nivea had purchased about 72,000 sq mt of land at Sanand GIDC in February for its first plant in India.
The company will employ local workers under the agreement with the State Industries Department. As a part of knowledge exchange for R&D, experts and scientists from Germany will visit the facility, while local workers will be sent to overseas for training.
Senior company officials and German representatives, including Prof Dr Reinhard Pollath, Chairman of the supervisory board of Beiersdorf AG, and Mishcel Ott, Deputy Consul-General of the Federal Republic of Germany, were present at the ground-breaking ceremony.