Etika targets up to 40% sales growth, keeps ad budget constant

Etika Group of Companies' president and CEO Erwin Selvarajah said it's looking to grow revenue by 30%-40% in the next three to five years, from a turnover close to RM1.5 billion last year, according to Malaysian media reports.The group is expected to maintain its advertising and promotion activities, which takes up about 5% to 10% of its annual total revenue. It will focus on providing its consumers "the best quality of its 12 categories of beverages and dairy products with affordable prices."The newly consolidated group is the merged entity of Permanis Sandilands Sdn Bhd and Etika International Holdings, both owned by Japanese beverage giant Asahi Group Holdings. Permanis was bought over in 2011, while Etika International was acquired in 2014.The consolidation is expected to strengthen the group’s position as the only fully integrated Halal beverage company in Malaysia.“Obviously, every FMCG (fast-moving consumer goods) company will be looking for double-digit growth. But year-on-year there are various challenges that we need to face. So to grow the business by 30% to 40% over the next five years, I think it is quite possible for us,” Selvarajah told local reporters at a press conference on 2 August.He also added that all of their products are gaining good traction across Malaysia, which leads him to believe that the group is well positioned to capture that growth.To date, the group’s share of the domestic retail ready-to-drink beverages market makes up to about 20% to 25%. For this year, Selvarajah said the group is looking to record a high single digit growth of sales in Malaysian market, surpassing its 2015’s RM1.5 billion sales turnover. Selvarajah added through efficiency, Japan’s technology and work relationship with PepsiCo, Etika is able to reduce production cost.Etika Group markets and distributes some of PepsiCo’s global brands such as Pepsi, Sting, Pepsi, Evervess, Mirinda, 7Up, Gatorade, Lipton Ice Tea and Mountain Dew exclusively in Malaysia.It also manufactures, distributes and markets Wonda Coffee and Asahi's Calpis plus its own brands like Chill Asian Drinks, Frost, Bleu Water and Kickapoo.