Jyothy Labs to boost investment in Exo amid Henkel's exit impact
Jyothy Labs Ltd will step up investment in its home-grown dishwash brand Exo, seeking to offset the fallout from German partner Henkel AG's decision to
Jyothy Labs Ltd will step up investment in its home-grown dishwash brand Exo, seeking to offset the fallout from German partner Henkel AG's decision to walk away from a 15-year licensing deal for the Pril and Fa brands. Chief financial officer Pawan Kumar Agarwal told shareholders at the company's 35th annual general meeting on Tuesday that "while the exit of Pril may have a near-term impact on the performance of the dishwash portfolio, your company is accelerating investment behind Exo dishwash liquid to strengthen its position in this category." The consumer goods maker's shares have fallen 27.9% this year, more than three times the decline in the benchmark Nifty 50 index, after Henkel notified exchanges on 9 May that it would not renew the agreement. The stock hit a 52-week low of ₹188.10 on 8 July. Also Read | How Onida plans to regain its glory Jyothy Labs reported a 10% drop in annual profit to ₹333 crore for the year through March, even as revenue rose 3.5% to ₹2,944 crore, as crude-linked input costs surged following the conflict between Iran and the US. Jyothy Labs’ other major brands include fabric whitener Ujala, dishwash bar/liquid Exo, mosquito repellent Maxo, detergent Henko, and soap Margo.
The company is focused on its own dishwash brand, Exo. “Our focus is on consumer-centric innovation, product quality enhancement, cost efficiencies, and developing differentiated offerings across our brands. R&D investment in the year increased to a five-year high of nearly ₹25 crore,” Agarwal said. The company is currently debt-free and sits on a cash balance of ₹997 crore as of FY26, up 31.7% year on year and nearly 12x its balance as of FY22. “We continue to see a good opportunity to grow the business organically,” Agarwal said. Growth in FY26 was led by fabric care, which saw 8.1% growth in value and 9.5% in volume, with 2X growth in liquid detergents. Despite 6% volume growth, the dishwashing segment recorded a marginal 1.3% decline in value in FY26. Personal Care showed recovery during FY26, with the Margo franchise growing by 5.2% in value and 1.6% in volumes. Exo bet "The company is now building Exo into a broader dishwash franchise," M. R. Jyothy, chairperson and managing director, told shareholders. "Exo will now be developed as an own brand platform across formats supported by a portfolio of established brands, a robust distribution network, and strong execution capabilities," she added. Pril has historically been the anchor brand for liquid dishwash and Exo for bars.
Now, the company is expanding Exo’s presence in the dishwash segment with new products and faces. Jyothy Labs appointed film actors Yami Gautam and Keerthy Suresh as Exo’s brand ambassadors. However, in FY26, the company’s and sales promotion expenses fell to ₹227 crore from ₹240 crore in the previous year. “The newly launched Exo variants in dishwash bar and liquid formats, Dr. Wool liquid detergent, and the refreshed Margo pack are resonating well with consumer demand for specialised, quality products across categories,” MD Jyothy said. Analysts are generally confident about the stock with 11 buy calls, 3 hold calls and only 2 sell calls as of Tuesday. “As per our checks, Pril accounted for c. 25–30% of dishwash sales, which translates to 8–10% of Jyothy Labs’ overall sales,” analysts at JM Financial said on 9 May. Pricey war The management attributed the fall in profit to rising raw material prices due to the Iran-US war, which began in late February, as nearly 60% of the company’s key raw materials and packaging inputs are linked to crude. “During the year, geopolitical developments, particularly the West Asia conflict, led to significant inflation in crude oil and crude derivative-linked raw materials and packaging materials,” CFO Agarwal said.
The BriefWire