Pidilite Industries Limited is an Indian multinational company known for its diverse product portfolio in adhesives, sealants, construction chemicals, and consumer products. With its headquarters in Mumbai, India, Pidilite Industries Limited was established in 1959. The business has a long history of developing novel solutions for both industrial and consumer needs. With a strong presence in both domestic and international markets, Pidilite has established itself as a leading player in various industries.

 Strategy

Pidilite commands a monopoly in the Adhesive and Sealants segment. This it gained by following a comprehensive strategy model based on the 4 Ps of Marketing. The 4 Ps of the marketing strategy, also known as the marketing mix, are key elements that organizations use to effectively promote and sell their products or services. These 4 Ps include Product, Price, Place, and Promotion.
Companies by developing a thorough marketing plan that successfully places their product in the market. Such that it draws customers, and boosts sales by carefully controlling these 4 Ps.

Product Strategy

Pidilite’s in-house research and development is one of the reasons behind its success. Pidilite has a robust research and development division that aids in producing cutting-edge items for the business.
Adhesives and sealants, art materials and stationery, fabric care, construction and paint chemicals, automotive chemicals, textile resins, and organic pigments and preparations are among the products that Pidilite sells. Additionally, Pidilite offers industrial specialty items such as footwear, pigment powder, industrial resins, and industrial adhesive.

A few of its popular products include the following: Fevicol Fevistick, M-Seal, Fevikwik, Dr. Fixit.

Pidilite’s Pricing Strategy

Pidilite Industries Limited has adopted a well-defined pricing strategy as part of its overall marketing approach. In order to expand its market reach, it uses competitive pricing. Some products start as low as Rs 5.
Its retail margins vary between 12% and 25%, depending on the specific product. Other competitors can play with the margins however, Pidilite provides superior quality, enabling them to outperform their competitors.

Place and Distribution Strategy

Pidilite has an extensive network of distributors and retailers. Its distribution network extends beyond tier 1 cities, as the company aims to increase its penetration in tier 2, tier 3 cities, and rural areas. Pidilite has a network of more than 4000 distributors and 400000 retailers at its disposal. This allows its products to be shopped from a variety of vendors, giving it a significant competitive advantage.
It has also spread its business in the international market after its success on Indian soil.

Products are available in around 100+ countries like the United States of America, United Kingdom, Singapore, Bangladesh, Sri Lanka, Indonesia, Egypt, Thailand, United Arab Emirates, China, South Africa, and Ghana.

Promotion and Marketing Strategy

‘Bhaiya ek Fevicol dena’
Do you recall how Fevicol became synonymous with glue in everyday life? One simply would not settle for anything less. Due to its engaging and memorable campaign, Fevicol became a household name.
Pidilite spends a considerable amount on sales and marketing of its products and overall brand image. It has consistently created clever commercials and memorable jingles to capture the attention of customers.  The advertising is widely praised for its excellent substance, inventiveness, and connection to the target audience.

Effective Marketing Campaigns

Fevicol’s marketing ads are not just ads, there are a part of our childhood. From the 90s till now, they have become a part of every household. So much that the mentioned ones will surely send you back in time and relive the carefree days. Some of them are.

• Fevicol Sofa (You’ve got to remember this!)
• Fevicol Cliffhanger
• Todo Nahi Jodo
• Fevicol Bus
• The Leakage Man – A Dr. Fixit Marketing Campaign
• FEVIKWIK started a social media campaign to recognize clumsy people who frequently unintentionally damage things by referring to them as “Fevikwik stars.” Numerous people related their personal experiences with the Fevikwik stars.
• Chehrey Par Mask Aur Do Gaz Ki Doori, Abhi Bhi Hai Bohot Zaroori – A Fevicol Marketing Campaign

Such successful campaigns made Fevicol and other products household names, capturing significant market share.

Awards for Marketing Campaigns

• Pidilite bagged 30+ advertising & marketing awards during the year.
• EFFIE Gold for Fevikwik’s “Phenko Nahi Jodo” campaign.
• Kyoorius Blue Elephant for Fevicol’s social distancing campaign.
• Silver in the Household Maintenance Products category at the 2002 Cannes for Fevicol Bus
  

Pidilite’s Fundamentals

Quarterly Results

The fiscal year 2022’s ending quarter brought in around Rs 283 crore in consolidated net profit YoY. This is an 11.28 percent increase compared to the March quarter of the previous year’s Rs 254.35 crore.

EBITDA i.e., Earnings Before Interest, Tax, Depreciation, and Amortization, YoY grew by almost 14.50 percent. EBITDA for the March quarter stood at Rs 459.16 crore. The corresponding quarter of the previous fiscal year’s EBITDA we recorded a net of Rs 401.08 crore.

Net sales brought in Rs 2689.25 crore. That is a 7.27 percent YoY increase in revenue which for the previous March quarter was at Rs 2507.10 crore.

Annual Results

Annual consolidated net profit increased by 5.44 percent. Net profits stood at Rs 1273.25 crore compared to last financial year’s Rs 924.91 crore.

EBITDA saw a 7.42 percent increase this year coming at around Rs 1984.37 crore against last year’s Rs 1368.21 crore.

Net revenue grew by 18.93 percent this financial year. It brought in Rs 11799.10 crore against last year’s Rs 7077.96 crore.

Shareholding pattern

During this quarter, the Indian promoter’s holdings in the company remained stable at approximately 69.94 percent. The DII demonstrated their confidence by increasing their holdings from 7.73 percent in September to 8.46 percent in the March quarter.
Conversely, FII holdings decreased from 11.08 percent to 10.61 percent according to the latest reports.

Peer comparison

SWOT Analysis of Pidilite

Strengths

• Strong Brand Portfolio

  Pidilite has a diverse and well-established brand portfolio, including popular brands like Fevicol, Fevikwik, Dr. Fixit, and M-seal. These brands enjoy high consumer trust and loyalty, providing a competitive advantage in the market.

• Market monopoly

  With regard to the adhesive industry, Pidilite has established a monopoly made possible by the success of its main brand, Fevicol. Around 70% of the market is controlled by Fevicol.

• Extensive Distribution Network–

  The company has a robust distribution network spanning across various regions in India and globally. This enables Pidilite to reach a wide customer base and ensures efficient product availability and timely delivery.

• Global presence
  

  With manufacturing plants in more than 9 nations, Pidilite is also present in more than 100 nations. Their wide variety of goods are available in most developed nations.

• R&D
  

  Pidilite Industries Limited has been a leader in consumer and specialty chemicals in India since its founding in 1959. Pidilite uses strong, research-driven innovation combined with user feedback to create the majority of its goods with an in-house research team. Additionally, Pidilite founded a cutting-edge research facility in Singapore that is currently a member of the Singapore Chemical Industry Council (SCIC).

• A strong bond
  

  In addition to their strong marketing campaigns and extensive distribution network, what truly sets Pidilite apart is their deep-rooted dedication to strengthening bonds. The company is committed to nurturing strong bonds and their approach exemplifies this philosophy. Pidilite understands the value of staying connected to ground reality, and this is reflected in every aspect of their operations. This is one such example.
  ‘I work as an assistant plumber in Vizag. My daily livelihood was lost because of the lockdown, and I was worried about supporting my family amid this crisis. I did not expect that any Company will come to the plumber community’s rescue in this pandemic. While no other company has interacted personally with us during the lockdown, Pidilite officials have been in touch with us since the first week of lockdown to remain apprised of our well-being. Pidilite officials did not just interact with us over call, they also met us and distributed essential grocery items to help us make ends meet. I am thankful to Pidilite for thinking about us during this crisis.” Mr. Ravi Kumar Plumber

Weaknesses

• Dependency

  The majority of Pidilite’s revenue comes from a small number of flagship brands. Despite the company having a strong portfolio of brands, more than 50 percent of the revenue is dependent on Fevicol and M-Seal. Due to this dependence, the business is at danger for brand saturation, shifting consumer preferences, or possible brand dilution.

Opportunities

• Expansion into Emerging Markets

  Pidilite has been expanding its international presence by entering new markets and strengthening its distribution networks. Emerging markets, especially in Asia and Africa, offer considerable growth potential for the company’s products, given the rising disposable income and urbanization trends.

• Product Diversification

  Pidilite can explore opportunities for product diversification in related sectors. Investing in research and development to introduce new products in niche segments or acquiring companies with complementary product portfolios can help expand the company’s market reach

Threats

• Intense Competition

  Pidilite faces intense competition from both domestic and international players across its business segments. Although it enjoys a monopoly, the Adhesives and Sealants markets due to entry of new players now faces increased competition. Competitors with similar product offerings and pricing strategies pose a threat to the company’s market share and profitability.

• Economic Volatility

  Pidilite’s business operations may be impacted by economic turbulence, such as quickly fluctuating crude oil prices, and geopolitical unpredictability. This includes raw material availability and consumer demand for its products.

• Regulatory Compliance
  

  Maintaining compliance with numerous regulatory standards and certifications can be extremely difficult. Continuous monitoring and expenditure on compliance measures are necessary to ensure compliance with environmental, health, and safety requirements.

Pidilite Industries Limited has established itself as a dominant player in the market, with a strong brand portfolio and a well-defined marketing strategy. Pidilite’s promotion and advertising strategy have been highly successful, with memorable campaigns and catchy jingles that have made its brands, particularly Fevicol, household names. The company’s focus on brand awareness and effective communication has contributed to its market share growth.

Overall, Pidilite Industries Limited’s strategic approach and commitment to product quality, distribution, and marketing have solidified its position as a market leader in the adhesive, sealants, construction chemicals, and consumer products industries.