P&G's performance returning to healthy levels in 'critical market' India
This is a rise for Gillette up from single digit growth last quarter, and suggests strengthening stability for Hygiene and Healthcare as this is its second consecutive double-digit growth quarter.
P&G had been struggling in recent years in the country due to being dragged down by various unprofitable brands across its home and personal care offering, including Old Spice (male grooming). The recent growth figures indicate it has successfully managed to turn that around.
"India remains a critical market for P&G. In the past 18 months, P&G India has become profitable. The value-accretive results that India has delivered have contributed positively to the health of the parent company," a spokesperson told the Business Standard.
Looking at profit, Gillette is now outperforming Hygiene and Households, with triple- and double-digit growth respectively.
Jon Moeller, global head of finance, recently outlined a plan to cull several of the company’s unsuccessful brands from its portfolio, noting that some had seen sales down by as much as 30%.
"The strategic portion of our India business is growing at a high single-digit pace. Sales in the portions we're fixing or exiting have been down more than 30 per cent. This top line pain is worth it,” he said, speaking in the company’s most recent analyst call.
“We're making significant progress in improving local profit margins, up about 700 basis points."
On a global scale, P&G has been taking decisive steps to address its lacklustre performance, in strategy particularly pushed forward by CEO David Taylor since his appointment at the end of last year.
Across the board, as in India, the company is moving towards a leaner, more streamlined business, reducing the number of flagging brands, and giving greater autonomy to regional management.
“A few years ago we got too central and global and too slow to address market opportunities. We need more direct ownership for our regional managers all the way to the store shelf,” Taylor said earlier this year.