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Striking it rich: Brand Godrej valued at $3 billion

A brand valuation exercise undertaken by the 114-year-old Godrej Group for the first time has pegged the value of the masterbrand Godrej at $3 billion (around Rs 13,000 crore).

Godrej The group, whose products range from cupboards and consumer durables to toilet soaps and hair colour, had hired UK-based brand consultancy firm, Interbrand, for valuing the master brand along with the subbrands in the group.
Although, at a valuation of $3 billion, Godrej would not feature among the top 100 global brands which were valued by Interbrand in 2010, the master brand Godrej is said to be ahead of brands like Lenovo and Nissan in the rankings. Godrej, which enjoys patronage of 470 million people in India, is behind the likes of Starbucks ($3.3 billion) and L. Oreal ($7.9 billion).
While Godrej Group officials declined to comment on the valuation exercise, it is learnt that a detailed report has been submitted by Interbrand, valuing each of the subbrands as well. Key brands in Godrej’s portfolio include, Godrej No.1, Cinthol, Good-Knight, Expert and Fair Glow.
While the methodology adopted by Interbrand for Godrej is not known, the various measures that the consultant takes into account while valuing a brand globally include, an organization?s internal commitment in its brand, a brand’s values, positioning and proposition, a brand’s ability to adapt to market changes and its relevance with customer needs.
The valuation exercise is expected to assist the Godrej group in expanding its brand equity globally, especially at a time when the group has established a substantial presence in three continents by way of acquisitions.
Mr. Adi godrej The group’s flagship, Godrej Consumer Products (GCPL) has made seven acquisitions across Asia, Africa and South America in the last five years. GCPL accounts for almost half of the master brand’s valuation.
According to Sunny Banerjea, partner, KPMG Advisory Services, a brand valuation exercise helps an organization and its stakeholders in many ways. Not only does it help attract talent, but also benefits shareholders who would now see better value coming through. A strong brand is a key differentiator for a consumer. A company which carries out a brand valuation exercise will be able to invest better behind its products. It also assists in the process of globalization, said Banerjea.
Brand valuation also helps organizations to command a premium in pricing at the retail end. ?Over the years, intangible assets have gained a lot of traction among businesses with brands increasingly playing an important role in sustaining the financial performance of a business, said an industry expert. Groups like the Tatas get a brand valuation done annually from Brand Finance, an independent brand valuation consultancy, which has valued the Tata Group brand at $15 billion and Reliance at around $7 billion.

Interbrand was roped in by the Godrej Group three years back to usher in a youthful look for its logo. It had outlined four main business verticals, known internally as hero businesses, for the group personal grooming, furniture, property and aerospace.
The Godrej Group is a closely held diversified conglomerate with business interests in consumer products, durables, chemicals, agri products, real estate, office furniture, locks and foods. Since the masterbrand has a unifier effect on all its businesses, it was vital for the group to renew its corporate identity.

Source: May 5, 2011, TOI