INDIAN SALT INDUSTRY IS GOING GLOBAL: AN OVERVIEW

India ranks third in the production of salt in the world next to USA and China. The Average annual production is about 20.31 million tones against the average annual world production of 240-250 million tones. Worldwide about 25 million tones of salt are used for edible purposes and rest is used for non-edible and industrial purpose. Salt Production Worldwide Huge consumption The world wide salt production is currently 200 million tons and exceeding the mark rapidly. The worldwide industries manufacture this huge quantity of salt not only for consumption but for non-edible and industrial purpose as well. Ways of extraction Almost sixty percentage of salt production in the whole world goes to the industrial usage. Only the remaining forty percent is used for miscellaneous purposes that major constitutes the application in the form of food additives. When you talk about the worldwide salt production, it is mandatory to know the different ways that the salt is obtained all over the globe. Prima facie, evaporation of sea water to obtain salts is the method carried out in majority parts of the Asian subcontinents. Especially in the India and china, the salt production is done in this ways and they obtain almost 99.5 percentage of purity still. The salts produced this ways are being washed again chemically to remove the impurities and then it is shipped. Different parts of the globe There are still other forms of obtaining salts as well. Even in India and china you could find some of these different forms of extracting salt. One is through mining process. This is salt extraction from the salt beds underneath the earth. Such a sort of salts is then allowed to be prepared in the laboratories to be modified to the form of fine granules as we see the table salt. Salts obtained in this way are in majority from the United States of America

as well as other European continents. Their purity levels are a big challenge though. They are not competent to the great purity levels obtained as one gets from the salts of India and china. 99.5 to 99.7 is the range of purity that could be obtained from these salts of the west. Most of them find applications only in the industries. It could be evident by now that almost all of those fine graded salts are just the western brand names carrying eastern salt inside. Anyhow, there is one more variety of salt obtained from the brine. This is called as solution mining process. This is almost one third of the total salt production methods in the world. All those salts extracted from the Australia and Mexico is essentially of this kind of manufacturing. The level of purity that is obtained is of the highest grade when you compare with the other forms of salt extraction. The purity range varies somewhere in between to the second decimals of 99.9. It depends from place to place from the set standards of production process carried out. Industrial applications Sometimes it is also about the raw salt content which is obtained from a particular place. There are certain traces of impurities at micro levels which are just integral part of the salt itself and it could not be removed even after so many sophisticated processes and techniques employed. Worldwide salt production for industrial applications includes the organic synthesis, petroleum production, byproducts fractional distillation and many more processes. Salt Industry in India India is the third largest Salt producing Country in the World after China and USA with Global annual production being about 230 million tones. The production of salt during 1947 was 1.9 million tones which has increased tenfold to record 20 million tones during 2005. In a very short period of time sufficiency was achieved (in 1953) and made a dent in the export market. Since then, the country has never resorted to imports. Exports touched an all time high of 1.6 million in the year 2001. The per-capita consumption of salt in the country is estimated at about 12

kg, which includes edible as well as industrial salt. The current annual requirement of salt in the country is estimated to be 60 lakhs tones for industrial use. Caustic soda, soda ash, chlorine etc., are the major saltbased industries. Besides about 15 lakhs tones of salt is exported every year. Sea salt constitutes about 70% of the total salt production in the country. Salt manufacturing activities are carried out in the coastal states of Gujarat, Tamil Nadu, Andhra Pradesh, Maharashtra, Karnataka, Orissa, West Bengal Goa and hinter land State of Rajasthan. Among these States only Gujarat, Tamil Nadu and Rajasthan produces salt surplus to their requirement. These three states produce about 70%, 15% and 12% respectively of the total salt produced in the country and cater to the requirement of all the salt deficit and non-salt producing states. Private sector plays a dominant role contributing over 95% of the salt production, while the public sector contributes about 2-3%. The cooperative sector contributes about 8% whereas the small-scale sector (less than 10 acres) accounts for nearly 40% of the total salt production in the country. op Brands of Salt in India

Tata salt Captain cook i-shakthi Aashirvadh Annapurna Surya salt Sambhar salt Nirma shudh and many more

Salt Works and Acreage under Salt Production There are about 10107 salt works, mostly in small sector engaged in the production of salt. The total area under salt production is about 5.0 lakhs acres. The salt manufacturing activities provide direct employment to about one-lakh persons per day. Distribution of Salt

Railways play an important role in transporting salt from three surplus states to the entire length and breadth of the country. On an average, 55% of edible salt is transported by rail from production centers. The remaining quantity moves by road and waterway. odized Salt With a view to ensure universal access of iodized salt for the prevention and control of goiter and other iodine deficiency disorders in the country, Salt Commissioner's Office has been identified as the nodal agency for creation of adequate salt iodization capacity, its distribution and quality monitoring at production centers, under NIDDCP. Salt Department has granted permission to more than 878 salt iodized units with an annual installed capacity of 112 lakh tones so far. Exports Export of common salt and iodized salt is permitted under Open General License (O.G.L.). Salt is exported manly to Japan, Philippines, Indonesia, Malaysia, Nepal, and Bhutan etc. India has, for the first time, exported 32,500 tonnes of common salt to the US during December 2002, creating a history of sorts. Liberalization and Simplification of Procedure Following amendments to Central Excise and Salt Act, 1944 in 1996, delicensing the salt industry and Salt Cess Rules, 1964 in 2001 and introducing self-removal procedure (SRP) instead of permit system for payment of cess and removal of salt from salt factories, several registers have been discontinued or re-organized. Sources of Salt The main sources of salt in India are

Sea brine Lake brine Sub-soil brine and Rock salt deposits

Major Salt Producing Centers

Sea water is an inexhaustible source of salt. Salt production along the coast is limited by weather and soil conditions. The major salt producing centers are

Marine Salt works along the coast of Gujarat (Jamnagar, Mithapur,Jhakhar, Chira, Bhavnagar, Rajula, Dahej, Gandhidham, Kandla, Maliya, Lavanpur), Tamil Nadu (Tuticorin, Vedaranyam, Covelong), Andhra Pradesh (Chinnaganjam, Iskapalli, Krishnapatnam, Kakinada & Naupada), Maharashtra(Bhandup, Bhayandar, Palghar), Orissa (Ganjam, Sumadi) and West Bengal (Contai) Inland Salt Works in Rajasthan using lake brine and sub-soil brine viz. Sambhar Lake, Nawa, Rajas, Kuchhaman, Sujangarh and Phalodi Salt works in Rann of Kutch using sub-soil brine viz: Kharaghoda, Dhrangadhra; Santalpur Rock Salt Deposits at Mandi in the State of Himachal Pradesh

Profile & Status of Salt Industry There are about 13000 salt manufacturers engaged in production of Common salt in an extent of about 5.50 lakh acres in the Country. It is estimated that 90 per cent of the total number of salt manufacturers are small salt producers (having an individual extent of less than 10 acres for salt manufacture), 5.5% is large scale producers (having an individual extent of more than 100 acres) and 4.5 % is medium scale producers (having an individual extent between 10 and 100 acres). Average Annual Production of Salt in India is 176 lakh tones whereas ever high production of 199 lakh tones was recorded during 2005 followed by 181 lakh tonnes during 2006. Gujarat, Tamil Nadu and Rajasthan are surplus Salt producing States accounting for about 96 per cent of the Countrys production. Gujarat contributes 76 per cent to the total production, followed by Tamil Nadu (12 %) and Rajasthan (8%). The rest 4% production comes from Andhra Pradesh, Maharashtra, Orissa, Karnataka, West Bengal, Goa, Himachal Pradesh, Diu & Daman. On an

average 62% of the total production is from large salt producers followed by small scale producers (36%) and rest by medium scale producers. The average annual supplies of salt for human consumption is about 57 lakh tonnes and that for industrial consumption is about 83 lakh tones; 57% of the salt for human consumption moves by rail and 43% by road. 89% of the salt for industrial consumption moves by road, 7% by rail and 4% by coastal shipment to various industries; when the total indigenous supplies is taken, 69% moves by road, 27% moves by rail and 3% by sea. India exports surplus production of salt to the tune of about 25 lakh tonnes on an average; during the year 2005, a record export of 38 lakh tonnes was achieved primarily due to surge of demand from China. Other major countries importing salt from India are Japan, Bangladesh, Indonesia, South Korea, North Korea, Malaysia, U.A.E., Vietnam, etc. Government of India has adopted the strategy of Universal Salt Iodization and Consumption for elimination of Iodine Deficiency Disorders (IDD) in the country under the National Iodine Deficiency Disorders Control Program (NIDDCP). Iodine is supplemented in the diet through Iodized Salt for combating IDD. The Program was started in 1962 initially confining to Goiter endemic areas but after 1984 it was implemented throughout the country. Thus, as on date, a significant progress has been made on Universal Salt Iodization. The country produces about 50 lakh tones of Iodized salt and about 49 lakh tones of iodized salt is supplied for human consumption against the requirement of about 54 lakh tones for entire population. The country has created more than adequate salt iodization capacity of over 110 lakh tones. Salt Industry is labor intensive in the country. About 1.4 lakh laborers are employed daily in the Salt Industry, on an average. Salt Commissioners Organisation has put in place a number of Labor Welfare Schemes ameliorating the working and living conditions of salt laborers. Government of Indias Role in Development of Salt Industry Salt is a Central subject in the Constitution of India and appears as item No.58 of the Union List of the 7th Schedule, which reads: a) Manufacture, Supply and Distribution of Salt by Union Agencies; and

b) Regulation and control of manufacture, supply and distribution of salt by other agencies. Central Government is responsible for controlling all aspects of the Salt Industry. Salt Commissioners Organisation, an attached Office under the Ministry of Commerce & Industry (Department of Industrial Policy & Promotion), Government of India, is entrusted with the above task. Government of India has de-licensed Salt Industry by deleting provisions relating to Salt in the Central Excise & Salt Act, 1944 vide Finance Bill of 1996-97. In line with Government of Indias Policy of Liberalization and simplification of Procedures, the Salt Cess Rules, 1964, have been amended vide Notification No.GSR 639(E) dated 04.09.2001. Salt Commissioners Organisation plays a facilitating role in overall growth and development of Salt Industry in the country. The thrust of the Salt Commissioners Organisation currently is on the following:

Technological Development and Quality Improvement Salt Iodization Program for combating Iodine Deficiency Disorders Infrastructure Development promoting Salt Industry Labor Welfare Schemes for Salt Workers particularly housing under NAMAK MAZDOOR AWAS YOJNA Export of Salt

Indian Salt Industry - Present Status The Salt Department is under the Ministry of Commerce and Industry and is headed by The Salt Commissioner of India. The duty on salt was abolished from 1st April 1947. For administrative purposes, the 5 Regions viz. Gujarat Region, Chennai Region, Mumbai Region, Kolkata Region, Rajasthan Region, implement the policies of the Salt Department. There are salt department laboratories in all regions to help salt manufacturers to maintain quality of salt. At state level, the development of industry and welfare of salt workers is being looked after by Industry Commissioner ate and labor department. The Indian Salt Manufacturers Association is an apex body of Indian salt

manufacturers. There is Central Salt and Marine Chemicals research Institute at Bhavnagar in Gujarat. Their main function is to help salt industry through their research work. This institute was established in 1956. In addition to R & D work the institute provides training courses for salt manufacturers for salt production & quality. Majority of salt works are still having manual operations, but large salt works are going for mechanization. Edible Salt Indian salt industry is meeting the challenge of supplying iodized salt to entire country. The production of iodized salt is now more than 5.0 million tons as against the total requirement of 6 million tons of edible salt. There are 900 iodization plants the usual process of iodization adopted is spray method with a capacity of 16 million tons per annum. There are 42 salt refineries with a total capacity of 3.76 million tons per annum located in the states of Gujarat, Tamil Nadu, Uttar Pradesh and Rajasthan. In addition to above there are two giant vacuum salt plants of capacity one million tons. Other varieties of edible salt consumed in India are Iron Fortified Salt, Double Forfeited Salt. A new product Health Salt Containing micronutrients iodine, iron, folic acid, was also come up near Chennai in Tamil Nadu. Salt based Industry There are four giant Soda Ash factories in India. Total production of Soda Ash is about 2.5 million tons per annum and in addition there are large numbers of Caustic Soda & Chlorine industries in India. The Salt based Industry is concentrated more in Gujarat. Total Salt consumption for Industries is 6.5 million tons annum. The New Chemicals Industries are coming up and existing units are going for major expansions; growth is at 8%. India is a net exporter of Soda Ash and emerging as a significant regional player. The current low per capita Soda Ash consumption also shows tremendous growth potential over next few years. Unlike to world average of 56% consumption of Soda Ash by the glass industry, the Indian glass industry only consumes 25%. The major share is used by Indian detergents industry.

Soda Ash uses in glass & detergents is 65% Glass industry estimated to grow @ 7% and Detergent @ 4.5% over the next 4 years Tightness in the global demand-supply situation expected There is good opportunity to increase export Low per capita consumption leaves a lot of potential to be tapped Despite the steep drop in duty rates over the years, the industry has been able to effectively compete with imports and is geared up for further reductions. Growth of Soda Ash and Salt industry directly connected hence good growth in salt demand is expected.

Indian salt industry is going global Salt production of India is 18 to 20 million tons per annum and India is the third largest salt manufacturer of the World, after China & USA. Out of this about 3.5 million tons salt is washed in mechanized washing plants and up graded to international standard having purity 99.5% for Chlor-Alkali industry. The major quantity of washed salt is exported to Quatar, Japan and other countries and consumed by Indian chlor-alkali industry. The washing plants are increasing day by day and quality is also improving very fast. About 218020 Hectares land is under salt production

In last five years more than 15 Salt Washing plants have come up to meet requirement for high purity salt. Now few Salt Works are fully mechanized with washing plants and they have achieved the following qualityi) Sodium Chloride (NaCl) % 96.50 - 97.50 ( on wet basis) ii) Moisture (H2O) % 01.50 - 03.00 ii) Calcium (Ca) % 00.03 - 00.05 iv) Magnesium (Mg) % 00.02 - 00.03 v) Sulphate(So4) % 00.10 - 00.15 vi) Insolubles % 00.01 - 00.03

The price of above salt, having purity 99.5%, after taking into consideration washing losses, stevedoring and other logistic expenses with marginal profit is about 15 to 16 USD per ton on FOBT

basis. At present this quality salt is available in limited quantity but availability is increasing very fast as more and more washing plants are coming up in India. Salt export may see uptrend this season (http://articles.economictimes.indiatimes.com/2011-1208/news/30490364_1_salt-production-salt-prices-salt-export)

According to news article of Economic Times on 8th Dec. 2011, Salt production has started in the Kutch belt of Gujarat and the SambharPhalodi belts in Rajasthan. Export orders are expected to increase with demand coming from China and South Asian countries. Salt prices increased post-Japanese tsunami earlier this year and have been stable since then. Salt production in Rajasthan is in full swing. By mid-December, the production will begin from Covelong, Marakanam, Cuddalore, Vedaranyam, Tuticorin and Nagercoil in Tamil Nadu along with Andhra Pradesh's Naupada to Isakapalli. By January, the production will begin from south Gujarat (Kambhat to Surat) and Palghar, Rai, Wadala centres of Maharashtra," said BC Raval, secretary, Indian Salt Manufacturers Association. Flooding, un-seasonal rains, foggy weather in China and Australia have ensured the demand picking up from Japan, Bangladesh, Nepal, Vietnam, Indonesia and Malaysia for the industrial salt. Exports in this calendar year (till date) have touched 3.8 million tonne and expected to cross 4.3 million tonne by December-end. On an average, India exports 2.5 million tonne salt. Salt production in India is to the tune of about 19-20 million tonne per annum, of which Gujarat produces 70%. In the domestic market, over 5.5-6 million tonne is used by the edible salt industry, 8.5 million tonne is used by the chlor-alkali industry (which mainly produces caustic soda, chlorine and soda ash) and over 2 million tonne in the water softening and tanning industry. Export contracts were signed at $35-40 a tonne. Raw salt prices are

currently ruling higher by Rs 100 to Rs 150 than the previous year's Rs 600-800 a tonne. In the retail, refined iodized salt was selling at Rs 1,200 to Rs 1,800 a tonne, depending on the brand and packaging, compared to Rs 1,000 to Rs 1,200 a tonne at the beginning of the year. India's edible salt market is 5.5-6 million tonne with branded salt market accounting for 1.3 million tonne. With a market share of 64% in the branded salt market, Tata Salt is the leading player, followed by Hindustan Unilever's Annapurna, Nirma's Shudh Salt and ITC's Aashirvaad Salt. On the backdrop of a balanced supply and demand, the prices are supposed to remain stable. Exports will be the real game changer in the coming days. The largest producer of caustic soda in India, Gujarat Alkalies & Chemicals (GACL), expects salt prices to increase if pre-winter rain lashes across the state. "We are annually experiencing pre-winter rain showers, which delay production and increase prices by 15-20%. If there is no shower till March, the industry won't have to worry," said an official from GACL. All major players like GACL, Indian Rayon, Gujarat Fluorochemicals are on an expansion mode. By 2014, GACL will increase caustic soda production by 300 tonne per day from the current production of 1,100-1,150 tonne per day. Potential for the Growth of Salt Industry

India has very long coast line and out of that Gujarat Coast line is of 1600 Kms In Gujarat in addition to existing salt industry lot of Land available along the side of coast for developing more salt works. Climatic conditions are suitable for salt industry. Easy Availability of skilled labors Good Administration of our Govt. and their Corporation. Our low cost of production Government support for critical infrastructure facilities. Minor Ports have loading capacity 5000 tons /day to 20000 tons /day in mid stream loading where as big port like Kandla have achieved the av. rate of loading of 25000 tons / day. We have a big advantage that ships of the capacity from 5000 tons to 100,000 tons could be loaded at our ports. There is potential for developing more ports as per requirement. In south India there is also a big port, Tuticorin close to salt manufacturing area.

Now only 20% industries have gone for mechanization and modernization, 50% from balance can also go immediately. Average yield of salt works is only 100 tons per hectare. This can be increased to 300 tons per annum by adopting modernization.

Opportunities

Export Market- 1) Quatar 2) Malaysia 3) Philippines 4) Japan 5) China 6) Vietnam 7) Indonesia 8) Nepal Indias location is very suitable to supply salt to China, Japan, Middle East and to other Asian countries. India has potential to increase productivity as well as quality. Available manpower. Wind Power-largest coastal line of Gujarat has potential to Generate 5000 MW through Wind Energy. The Salt Industry can make use of this energy jointly through associations. Availability of good major and minor ports as well as of good anchor points. To grab the developing market of Middle East.

Conclusions

Indias salt production can be increased considerably by achieving average yield of 300 tons per hectare and by developing available large areas in Gujarat. Salt quality required to be improved in general in all sectors small and big to feed good quality salt to Indian Chlor-Alkali Industries as well as for export. Salt Industry has very good future hence new entrepreneurs should grab this opportunity.

Marketing strategy of tata salt

Branding is new process mantra for Tata Chemicals in turning this commodity entity into a FMCG major, says Russell Foulds Tata Chemicals Limited (TCL) has been in the business of inorganic chemicals and fertilisers for over 60 years but it is only of late that this Rs1,500-crore-plus company has ventured to transform itself from a traditional manufacturing company to a very market-oriented one. And the recent relaunch of its well-established Tata Salt coupled with this product hitting top position in the ET Brand Equity Survey as the Most Trusted Brand this year has reinforced the view that Tata Chemicals has turned market-savvy and is on the way to becoming more of a brand than a mere commodity in the near future. Prasad Menon, managing director of the company, told Deccan Herald that manufacturing industries in India have moved from a protected market to a competitive market and in that context understanding customer needs and meeting expectations has to become a clear focus. The question being asked is whether the runaway success of Tata Salt would prompt the company to turn soda ash and fertilisers also into branded products. "Commodity branding is definitely engaging our attention. Already our cement and urea products are being marketed under the Shudh brand and we are evaluating other options," MrMenon said. Fertiliser division In the fertiliser area, TCL's urea plant at Babrala in UP has a capacity of 7.42 lakh tonnes per annum, constituting 12 per cent of the total private sector production and is considered one of the world's most efficient fertiliser manufacturing facilities. The plant is located close to the high consuming northern belt in the Gangetic plain, which constitutes 48 per cent of aggregate domestic demand and accounts for 88 per cent of the company's total urea sales. But with the drought in evidence here, it remains to be seen what effect this would have on future production and sales. The company is expanding its distribution network of agri-service initiatives called Tata Kisan Kendras that will serve as a platform for brand-building, greater penetration and optimal distribution, and once the sector is deregulated TCL will greatly benefit from this move. Marketing strategy Explaining the company's marketing strategy for salt and its two other core

products namely soda ash and fertilisers, Mr Menon revealed that the company's salt business has undergone a complete revamp of its marketing and distribution structure. A dedicated sales team on FMCG lines has been set up to manage the salt business and with the objective of offering an alternative to the priceconscious housewife, a second brand of salt under the name Samundar has been test-marketed and proved successful with commercial launch options under consideration. He said that in the area of soda ash, Tata Chemicals is aggressively targeting new customers and while strengthening its field-force, efforts are on to render the product globally competitive. The organisation itself is being restructured along key account management practices. However, urea is still a controlled commodity and future marketing strategies would depend on the long-term policy on fertilisers. But he acknowledged that the competition for soda ash is from within the country and also from without. And while the company has launced a programme to make its soda ash globally competitive, TCL will proactively enhance Tata Salt's value proposition and further consolidate its leadership position. Salt business Salt is manufactured at the company's integrated Mithapur complex with 3.5 lakh tonnes of vacuum-evaporated salt coming out each year along with 33,000 tonnes of caustic soda and 180 tonnes of bromine and bromine-based compounds. Every month 28 million 1kg packs of Tata Salt are produced at Mithapur. While TCL's MD is delighted at Tata Salt's numero uno status on the brand list, its vice-president (sales and marketing) Kapil Mehan, is very positive about the outlook for Tata Salt. According to him, Tata Salt has been a pioneer, a leader for long in this category and always regarded well by the key consumer the housewife. But as to why this brand is way down at number 25 in south India, Mr Mehan confirmed that the company was aggressively expanding its stockist base there from 220 at the start of this fiscal year to 280 at present. New distributors are being appointed and it is investing in channel associates. For example, it has organised specialised training programmes on sales, marketing, enterprise management and brand-building for its

distributors and their sales force. There are reward and reorganisation programmes. Product availability is being put in place and the company is also undertaking mass media advertisements in the south zone which is expected to increase awareness and brand pull. These ads are of course targeted at that specific audience and in the language of that region. This year will see TCL spend about Rs10crore on advertising between the Tata Salt and Samundar brands. Mr Mehan noted that Tata Salt leads the way as first mover and leader in the branded iodised salt market. It has a 17-per-cent market share in the branded salt category and among national brands, its share is higher at 38 per cent. The marketing strategy would be to continue expanding reach and availability of the product while improving the market base. It will continue upgrading users of unbranded, unhygienic loose salt and continue to improve product and packaging offerings to the consumer. He affirmed social responsibility and brand commitment and to this end has launched the Desh Ko Arpan programme where 10 paise on each pack of Tata Salt sold in a month would go to CRY. An average of three crore Tata Salt packs are sold each month. Mr Mehan said advertising for the product largely revolved around the television medium with Doordarshan forming the dominant chunk of its media plan given it still has the highest reach especially in areas like UP, MP and Bihar where vast numbers of consumers are unbranded and loose salt users. He nevertheless is confident that though the market is competitive with multinationals and Indian firms alike pumping money into messaging the consumer, Tata Salt will continue to lead as long as it reaches out and makes itself available. The company always has a ear to the ground to be in touch with the consumer's needs. Export market According to Mr Mehan, Tata Salt is being targeted at the Middle East and Bangladesh as far as exports go and he thinks that today's salt market is very dynamic with the consumer constantly evolving. Market variables keep changing, a retail revolution is slowly descending on us and globalisation has its effects even on a humble product on the kitchen table called salt. There can be no one formula that any player can stick to - in keeping with changing market needs strategies will also keep on changing.

Financials Prasad Menon said that operations for TCL during 2001-2002 were affected due to a power plant fire at its Mithapur chemicals complex, which resulted in lower production and turnover during the first quarter. During 2000-2001, there was a one-time profit on sale of investments of Rs 220 crore against nil in the succeeding year. But despite these factors, the profit before tax for 2001-2002 at Rs 200 crore was higher by Rs 14 crore over the previous year. The profit after tax was nevertheless lower over the previous year since the company had to make provision for deferred taxation of Rs 34 crore. But during the first quarter of the current year ended June, 2002 it posted a net profit of Rs 34.01 crore against a net profit of Rs 13.19 crore in the corresponding period of the previous year even as its total income went up to Rs 369.88 crore from Rs 295.17 crore. During 2001-2002, TCL showed a decline in performance with a marginal fall in sales to Rs 1481.32 crore against Rs 1502.14 crore in the previous year. But that was due to the first at its Mithapur plant. Since then operations have stabilised. The year also saw a substantial reduction in interest costs through a combination of debt reprofiling and debt reduction initiatives. The current market price of around Rs 55 discounts the latest earnings by roughly 10 times. The company has shown a good dividend yield of around 9 per cent and has Rs 556 crore of investments in its books. Mr Menon denied that the company had plans to enter the branded foods business in a big way and went on to stress the importance of its distributors and supply chain partners. These are vital partners in taking our product to the consumer, he said, adding that with this in perspective, TCL recently conducted customised training programmes to enhance the competencies in its channel partners. He disclosed that TCL is pursing a number of initiatives to consolidate and drive growth in its core businesses. These initiatives aim to build on the organisation's inherent manufacturing strengths to drive sustainable and profitable growth and become globally competitive. They include restructuring the marketing function, becoming more customer-focused and improving operational efficiencies by aggressively cutting costs and streamlining supply chain management. As part of its quality initiative, TCL has also decided to focus on all activities at the micro-level and create a performance-oriented company.

Quality initiatives It has therefore adopted the Tata Business Excellence Model (TBEM) which has a holistic approach to improving business processes unlike other quality initiatives. TBEM has helped the management identify cost-cutting, human resources development and developing marketing strategy as three critical areas for overhaul. As part of the cost-optimisation and revenueenhancement strategy, it has started the Manthan programme to intensify performance improvement across all business divisions. This is expected to make the soda ash business globally competitive. Analysts maintain that though TCL accounts for around 42 per cent of the country's soda ash capacity at 8.75 lakh tonnes per annum and is one of the largest producers of synthetic soda ash in the world not to forget its prime position as producer of industrial and edible salt with a domestic market share of close to 40 per cent, the company has been somewhat affected by problems in the soda ash business. Last year, the import duty on soda ash was reduced from 38.5 per cent to 20 per cent while there was also an additional capacity created through Nirma, a one-time customer turned competitor. And price increases by key global players namely the US, China and Kenya led to a rise in landed and domestic prices in India. But to counter import threats, TCL is looking at improving efficiencies and aims to become the lowest cost synthetic soda ash producer by next year. Salt has become an important product and TCL produces 3.5 lakh tonnes of vacuumevaporated salt each year. As market leader, the company decided to make this business an FMCG one and it has gone on to revamp its marketing team and structure to incorporate the strengths of and FMCG company. Its 29 distributors and 24 supply chain partners will help it achieve a greater and direct market penetration while increasing market efficiency. Tata Salt is set to become a global brand and will be first introduced to countries where the Indian population is high and then across the globe. Salt will play an increasingly important role in the turnover of TCL especially given its rising market share and product promotional activity. Mr Mehan is certain the conversion from unbranded to branded salt will pick up pace. The distribution and logistics will always be a challenge for a bulk and low-priced product like salt, he says, but the company will

continue to maintain its leadership position in this category. Mr Menon is also confident of the future with regard to Tata Salt and the company as a whole. A specialised marketing team incorporating skills like brand management and advertising and with the relevant experience in marketing and distribution is in place to nurture the marketing and promotion of the salt business. "Though growth will be marginal during the current year, marketing and advertising will be critical inputs in our future operations to differentiate our brand and retain our leadership position in all core businesses of the company." The mood is positively upbeat at Tata Chemicals.

Marketing practice Tata salt is India's first branded salt. The story of this brand is interesting because the brand came as bye product. Tata salt was launched in 1983.

Tata Chemicals has their largest integrated chemical plant in Mithapur. The soda ash plant needed fresh water for their boilers. Hence to supply fresh water, the company started purifying sea water and it created high quality salt as a bye product in the process. This coincided with the government campaign with the support of UNICEF for promoting Iodised salt since iodine deficiency was a serious issue haunting the children's health. This environment gave birth of one of the super brands and a classic case of branding a commodity in the Indian market.

The Indian salt market is estimated to be around Rs 1 Billion. The market is dominated by unbranded players. Tata salt have a market share of around 40% in the branded segment and 18% in the total market. The product salt is a low involvement and low value product with little scope of differentiation. Tata salt had the first mover advantage and was able to consolidate its position in the market thorough brand building. 1990 saw organised players eyeing the market. Captain Cook salt was launched in the market taking the " free flowing " feature as a differentiating factor. 1996 saw HLL extending its Annapurna brand to salts and positioning its brand on the platform of health and iodine content. 2001 saw the high profile launch of Dandi salt from Kunwar Ajay sari fame.Still 70% of the market is dominated by unbranded players. Tata salt started its life positioning on the rational platform of purity. Since the corporate brand had the value of Trust engrossed in Indian consumer's mind, Tata salt was eagerly owned by the consumers. One of the major

factors that accelerated the growth of branded salt and Tata salt was the effective campaign by the government to promote iodised salt. The campaign penetrated the market to as deep as 20% and the first mover Tata Salt benefited most out of it. 2002 saw the repositioning of Tata Salt on the platform of emotion. The brand owners felt that they should rise above the rational differentiation and try to emotionally influence the consumers. Hence Tata salt adopted its new tagline " Desh ka namak" translated " Salt of the nation". The brand is trying to associate itself to the nationalistic feeling of the consumers and is trying to fill a passion towards the brand. It is a herculean task for a brand that is in a category which is low involvement and low priced. To create involvement in such a category will be a tough task . But the campaign has

raised the brand to new heights in terms of market share. Since customers usually are brand loyal and tend to use the same brand of salt every time ( convenience factor) , such high decibel campaigns helps in strong brand recall. But the long term view of this category is challenging because the scope of differentiation has not been sustainable. There has not been any serious product development these years and this can recommoditise the category.The brand owners may have to think about value additions in the marketing mix to capture the 70% of unbranded segment.

Desh ka namak Tata Salt unveils new brand positioning Tata Chemicals to champion social causes with the launch of the Desh ko arpan programme

Tata Chemicals Ltd, the pioneers and undisputed leaders in the packaged salt category today unveiled Desh ka namak, its new brand positioning and advertising campaign for Tata Salt. A paradigm shift from the rational (right brain) advertising approach to the category, the Desh ka namak platform will see Tata Salt take an emotional (left brain) platform, which has the potential to be a big category clutter-breaker. Unveiling the new positioning platform, Kapil Mehan, vice president, sales and marketing, Tata Chemicals, said, "Although advertising for the salt category in India has traditionally focused on detailing the functional properties of the various brands, Tata Salt, as the category leader, is best equipped to take on the broader and more fundamental emotional aspects associated with salt. "The new positioning juxtaposes the pungency of the

product itself against the honesty and integrity of ordinary Indians, reinforcing the brands leadership position, both in the marketplace and in the minds of Indian consumers. All of which reiterates the brands commitment to millions of Indians." With the intrinsic equity and strength needed to shoulder such an emotional platform, Tata Salt has reaffirmed its leadership position by changing the category paradigm of health and taste. While Tata Salt has thus far been positioned on the rational aspects of 'purity', its new positioning places this very proposition within the larger context of the consumers life, encompassing both rational and emotional manifestations of purity. Over the past year, Tata Chemicals has put in place a strong brand management, marketing and sales team. The effective marketing initiatives are being backed on ground, by a team of large clearing and forwarding agents (CFA) and distributors, with a focus to service the market in an enhanced manner and ensure greater market penetration. Coinciding with the launch of its new marketing thrust for Tata Salt, Tata Chemicals has also unveiled the Desh ko arpan programme, that is committed to champion socially relevant causes for under-privileged children. Through the Desh ko arpan programme, Tata Chemicals Ltd. will contribute 10 paise for every kilo of Tata Salt sold, to a worthy cause. On the basis of the current monthly sales of nearly 300 million packs, the monthly contribution is expected to be in the region of Rs 30 lakh. Child Relief and You (CRY), the trust that works for underprivileged Indian children, has been chosen as the beneficiary for this maiden effort. The money raised will support 6 child development

initiatives across the country, touching the lives of over 12,000 children. Announcing this special initiative from the company, Kapil Mehan said, "Our new advertising platform and the Desh ko arpan campaign have strong synergies and the common belief in the power of ordinary individuals to make a difference. "More importantly, Desh ko arpan provides millions of Indians, who are buyers of Tata Salt, a genuine opportunity to make a contribution that will transform the lives of underprivileged children across India." Commenting on the launch of the programme, Ingrid Srinath, director, resource mobilisation, CRY, said, "We are proud to be associated with Tata Chemicals. "The relationship is a live example of how corporates and development organisations can work together to change the lives of our most vulnerable citizens our children." Established in 1939, Tata Chemicals Limited is one of India's leading manufacturers of inorganic chemicals and fertilisers. Part of the Rs 400-billion (US$ 9billion) Tata Group, the company owns and operates the largest and most integrated inorganic chemical complex in the country at Mithapur, Gujarat. The fertiliser complex in Babrala, Uttar Pradesh, is known for its world-class energy efficiency standards, and has won several awards in the fields of environmental conservation, community development and safety. Tata Chemicals is today widely acknowledged as the leader in the chemicals and fertiliser industries. The company has a turnover of about Rs1500 crore and employs about 3000 personnel.

Tata Chemicals plans to target 40-50 per cent share of voice during the campaign. In the first phase, the new TVCs to be launched across all major channels.

The new campaign will be aired in 6 languages.

The new positioning of Tata Salt Launched in August 1983, Tata Salt was the first national brand of packaged salt to be marketed in India. To millions of Indian housewives, it presented a welcome move away from the loose, unbranded salt of suspect quality to the reassurance of clean, pure salt guaranteed by Indias most trusted business house. As consumer acceptance of Tata Salt grew, so did the attractiveness of the category to potential manufacturers, both large and small. The last 19 years have seen the launch of scores of new brands of packaged, iodised salt, including over half a dozen national brands. However, today Tata Salt continues to be the undisputed leader in the category. Tata Salts historical positioning as the 'pure salt' is rooted in the fact that it is manufactured using the vacuum evaporation technique, which renders its endproduct much purer than the more commonly used refining technique of washing the salt with water and adding some more chemicals. For the Indian consumer, the reputation of the Tata name was an equally strong certification of the products quality. Furthermore, the proof of purity lay in their experience of a distinctly 'saltier salt', relative to those offered by other brands. All of this translated to a superior value proposition for the consumer, and a dominant market share for the brand.