Patanjali Project

CONTENT
S. No TOPIC PAGE NO
1. COMPANY PROFILE 8
2. RATIO ANALYSIS 29
3. RESEARCH AND 40
METHODOLOGY
4. REVIEW OF 43
LITRETURE
5. DATA ANALYSIS 49
SWOT ANALYSIS
6. RECOMMENDATION 86
7. CONCLUSION 87
8. BIBLIOGRAPHY 89
5
CHAPTER NO. 01
INTRODUCTION
I) Patanjali
Patanjali has been widely considered as a game changer in the Indian market.
Patanjali Ayurved Limited is an Indian consumer goods company.
Manufacturing units and headquarters are located in the industrial area
of Haridwar, Uttarakhand manufactures mineral and herbal products.
According to CLSA and HSBC, Patanjali is the fastest growing FMCG
company in India. The company became a dominating name in the Indian
FMCG sector, also known as CPG. It is valued at 3,000 crore (equivalent
to 32 billion or US$450 million in 2018) and some predict revenues of 5,000
crore (US$700 million) for the fiscal 2015–16.Patanjali declared its annual
turnover of the year 2016-17 to be estimated 10,216 crore (US$1.4 billion).It
was listed 13th in the list of India's most trusted brands as of 2018, and ranks
first in FMCG category Baba Ramdev and Acharya Balkrishna founded
Patanjali, Baba Ramdev was ranked as the 27th “Most Creative Business People
of 2016” by the Fast Company Business Magazine. Acharya Balkrishna serves
as its current CEO. According to Forbes, he ranks at 25th position in India’s 100
richest people list in 2019 with the net worth of $5.1 Billion.
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COMPANY PROFILE:
❖ Type - Private
❖ Industry – Consumer Goods
❖ Founded – 2006
❖ Founder – Balkrishna, Ramdev
❖ Headquarters –Haridwar, Uttarakhand in India
❖ Area Served – Indian Subcontinent and Middle
❖ Products – Foods, beverages, cleaning agents,
Ayurvedic Medicine, Personal Care Products.
❖ Total Assets – 4,345 crore (2019)
❖ Owner – Balkrishna
❖ Director – Swami Muktananda
❖ Number of Employees – 2,00,000
COMPANY ANALYSIS: PATANJALI

In the present scenario, the market of ‘Wellness Industry’ in India is less than 2%
as compared to the international market. There are untapped opportunities in the
wellness industry because of which the government has given special focus on this
sector in the ‘Make in India’ campaign. Active involvement from private and
public players can create huge impact and buzz in the global market. The motives
are the expansion and spreading the awareness and usability.
Patanjali Ayurveda is maker of ayurvedic consumer products and is one of the

fastest growing consumer companies in India. The company was formed by Baba
Ramdev in 1997 in collaboration with Acharya Balkrishna (scholar of Ayurveda,
Sanskrit and Vedas) to manufacture ayurvedic medicines. Ramdev has focused on
Yoga while Balkrishna is spreading and channelizing Ayurvedic products.
The company provides a bunch of products and services which revolves around
the consumer needs. Providing them high-quality products at attractive prices is
the USP. It has become a household name. The company sources raw materials
directly from farmers to cut middlemen cost for increasing profits.
Products are sold through three types of medical centres:
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Patanjali operates multiple Sewa Kendras to offer facilities of free consultations
and yoga lessons and has 5,000 franchised stores. Patanjali’s value proposition and
it’s positioning is in the gap where consumers are not sure about the benefits of the
current FMCG products. The company has marketed its products through unique
word of mouth (free yoga classes) publicity model thus the entire revenue is
generated without advertisement.
REGULATORY FRAMEWORK
The Indian System of Medicine(ISM) like Ayurveda, Homoeopathy, Siddha,

Unani, Yoga and Naturopathy has been assured to provide budgetary and
incentives support by the government. Since, Patanjali operates under
AYUSH, the government regulatory framework has:
• Preservation of Intellectual Property Rights: The wealth of knowledge on

formulations and medicinal use of plants which are available in ancient Indian
texts have attracted foreign interest. Patenting them claiming as innovations,
though these already available in the public domain so cannot be patented.
• Central Council for Health and Family Welfare (1999): At least one
physician from the Indian Systems of Medicine & Homoeopathy (ISM & H)
should be available in every primary healthcare centre and the vacancies
caused by the unavailability of allopathic Doctor should be filled by ISM & H
physicians.
• Indian Medicines Central Council Act (1970) and Homoeopathy Central
Council Act (1973): 5.5 years Under-Graduate course and 3 years Post-
Graduate qualification. Also, provisions for adequate clinical exposure and
internship for students.
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SUBSIDIES AND BENEFITS
• The Ministry of AYUSH (Ayurvedic, Yoga, Naturopathy, Unani, Siddha and
Homeopathy) has received Rs.1214 crore in budget 2015-2016. Government’s
intent to foster growth in this sector is very well evident. The areas to be
covered in subsidising the sector are:
• Developing the AYUSH educational Institutes and enforcing extensive quality
control practices in the sector.
• Focussing on Information, Education and Communication by creating
awareness through “Arogya Fairs”, exhibitions and also multimedia and print
media campaigns.
• Conservation, Development and Sustainable Management of medicinal plants.
• The Centre of Excellence establishment supporting innovation at public and
private Institutions.
• Implementation of Central Sector Grant-in Aid Scheme for promotion of
AYUSH Intervention. 3years for implementation with maximum Rs1.50 crore
provided to the grantee organization.
Patanjali receives subsidy as part of “Mega Food Park” scheme which is aimed
at raising the processing of perishables in the country from existing 6% to 20%
building share from 1.5% to 3% in global food trade by year 2015.
Some essentials of the scheme are:
• Providing infrastructure to food processing on predetermined basis
• Value addition to agricultural commodities to be ensured
• Establishing sustainable raw material supply chain
• Inducing of latest technology in the sector
• Pooling of resources for activities complementing food processing
• Quality assurance by process control, capacity building and optimization
Patanjali has prospects of getting subsidies which the Government is offering

for growth of AAYUSH sector.
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PROPOSED DIVERSIFICATION
Reaching Rs. 10,000 crore revenue by offering quality service and multiple
product lines is the projection of Patanjali Ayurveda. Diversification in
product and geographical reach should be opted. Cost and risk associated with
doing business largely depends on political stability and economical
advancements in the foreign markets. Also, commitment of significant
resources is required for entering a market. Taking these two into
consideration, Patanjali should tap Asian market of developing and under-
developed countries for its products. Initially, exporting the product avoiding
substantial cost of manufacturing should be taken up. Building slowly,
achieving the experiential curve for the product success and hence becoming
familiar with the market is the strategy which should be implemented.
Depending upon the success, the mode can be changed to longer term
commitment of joint ventures. Also, standardization of product constituents is
a must with localization of packaging for the business to prosper.
Yoga and naturopathy being an important part of wellness is a major business
of Patanjali. Targeting developed countries with the service that will ensure
not just physical fitness but also overall well-being. To expand in this market,
recommendation of joint venture will be the best fit and Patanjali does not lose
over its core competence.
IMPLEMENTATION STRATEGIES
The brand needs to frame and practice rigorous implementation framework to
touch upon various developmental aspects:
• Firstly, encouraging Research and Development will inculcate and promote

the tradition of Ayurvedic medicines and herbal formulations. Standardization
should be encouraged at this platform as constituents of products must be
uniform.
• Training human resources in production units and service centres. Production
units must have experts for quality products. The Service Centres (yoga
centres, Ayurvedic spa, studios, etc.) should have qualified professionals to
serve the customers.
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• Identifying issues related to exports by knowing the target market and segment
to be catered in that market. Simplifying the export process coupled with
durable packaging.
• Establishing of an authority to check authentication and quality of products
before export. Safety measures should be practiced during the production and
packaging.
• Having registrations with various regulatory authorities in the country and
abroad to run the business smoothly.
• Preservation of Intellectual Property Rights becomes critical with the products
and services being exported to foreign countries.
• Infrastructure improvisation by bringing in new technologies at factory
outlays, equipment’s manufacturing and service offering.
• Getting the products and medicines ISO 9000 certified to export to major
international markets.
• Opening of new centres in areas like north-east. Enforcing R&D and
infrastructure in areas rich in flora and fauna of ayurvedic importance.
• Medical tourism can be uplifted in collaboration with the hospitality industry

• Building over all awareness by using promotional mix. Presently, it is word of
mouth promotion.
IMPACT ON GOVERNMENT SUPPORT

Increasing the share from 2-4% to 10% of the National Health Budget towards
the sector to improvise infrastructure, opening of Kendras, etc. To provide
fiscal incentives and tax concessions will further boost the industry by
increasing viability and competitiveness.
• The laws governing the sectors will need to be re-enacted as an impact for
growing medicinal plants, manufacturing products and exports happening in
this arena.
• Getting cooperation from sectors like Department of Culture, CII,
ASSOCHAM, FICCI.
• The government needs to have new legislation covering food supplements and
nutra ceuticals. The licensing of these is required.
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POTENTIAL CHALLENGES
The company can face impeding challenges in future. Some of the budding
challenges are:
• Proper amount of training and skilled labour will be required to overcome
constraints that the industry has as a whole.
• Promoting products in the international market because of improperly

strategized channels of doing business in the foreign market.
• Determination of degree of localization is not clear and hence requires a lot of

research for various markets.
• With growth becoming prominent lack of IT knowledge, trust, capital access,

research and innovation will become indispensably important.
• ISM&H uses plant materials extensively for preparation of their drugs.

Although 8000 plants are stated to have medicinal properties, only 500 of them
are generally used.
So the resource exploitation is inappropriate.
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MODE OF FOREIGN DIRECT INVESTMENT
Presently, 92% stake in the company is owned by Balakrishnan and 8% of it is
held by a couple in UK. Opting for joint venture is the mode of FDI with
Limited Liability Partnership. Bringing capital investment in infrastructure and
machinery by the foreign counterpart should be practiced. Also, encouraging
investments by importing expertise for refinement of technology in operations
of Patanjali should be taken-up.
Well-established channels of partners should be used by Patanjali in the host
countries for distribution, sales promotion and eventually sales. The
collaborating firm will also be responsible for localization (international look
appealing) and upselling of the products resulting in creation of brand equity.
This partnering will also enable realization of time to enter the international
markets, pricing strategies and promotional mix for products and services.
Ultimately, there will be introduction of brand which will be enhanced with
time.
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II) History
1] Patanjali was a sage in India, thought to be the author of a number
of Sanskrit words. The greatest of these are the Yoga Sutras, a
classical yoga text. There is doubt as to whether the sage Patanjali is the author
of all the works attributed to him as there are a number of known historical
authors of the same name. A great deal of scholarship has been devoted over
the last century to the issue of the historicity or identity of this author or these
authors.
Amongst the more important authors called Patanjaliare:
Patanjali is one of the 18 siddhars in the Tamil siddha (Shaiva) tradition.
Patanjali continues to be honoured with invocations and shrines in some forms

of modern postural yoga, such as Iyengar Yogaand AshtangaVinyasaYoga.
Yoga Sutra
The Yoga Sutras of Patanjali are 196 Indian sutras on Yoga. It was the most
translated ancient Indian text in the medieval era, having been translated into
about forty Indian languages and two non-Indian languages: Old
Javanese and Arabic. The text fell into obscurity for nearly 700 years from the
12th to 19th century, and made a comeback in late 19th century due to the
efforts of Swami Vivekananda and others. It gained prominence again as a
comeback classic in the 20th century.
Before the 20th century, history indicates the Indian yoga scene was
dominated by other Yoga texts such as the Bhagavad Gita, Yoga
Vasistha and Yoga Yajnavalkya. Scholars consider the Yoga Sutras of
Patanjali formulations as one of the foundations of classical Yoga
philosophy of Hinduism.
Mahabhashya
The Mahabhashya of Patanjali on the Asthadhyayi of Panini is a major early

exposition on Panini, along with the somewhat earlier Varttika by Katyayana.
Patanjali relates to how words and meanings are associated. Patanjali
claims shabdapramanah that the evidentiary value of words is inherent in
them, and not derived externally the word-meaning association is natural.
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These issues in the word-meaning relation would be elaborated in
the Sanskrit linguistic tradition, in debates between
the Mimamsa, Nyaya and Buddhist schools over the next fifteen centuries.
Patanjalatantra
Patanjali is also the reputed author of a medical text called Patanjalah, also
called Patanjala or Patanjalatantra. This text is quoted in many yoga and
health-related Indian texts. Patanjali is called a medical authority in a number
Sanskritas Yogaratnakara, Yogaratnasamuccaya, Padarthavijnana, Cakradatta
bhasya. Some of these quotes are unique to Patanjala, but others are also
found in major Hindu medical treatises such as Charaka
Samhita and SushrutaSamhita.
There is a fourth scholar also named Patanjali, who likely lived in 8th-century
CE and wrote a commentary on Charaka Samhita and this text is
called Carakavarttika. The two medical scholars named Patanjali may be the
same person, but generally accepted to be completely different person than the
Patanjali who wrote the Sanskrit grammar classic Mahabhasya.
2] Pujya Swami Ram Dev Ji Maharaj who has dedicated his presence to
augment the haloed traditions of the trust based on selfless service and
dedicated quest for excellence in education, vedic learning and promotion of
nationalism; he is joined by an energetic soul with an intense spirit of service,
Acharya Balkrishna Ji Maharaj, also a great spiritualist & great scholarof
Ayurveda and an established name in Vedic philosophy Swami
MuktanandjiMaharaj Science Graduate, Vyakaranacharya along with other
disciples continue to exalt the traditions and enrich the future with what the
trust had enshrined and achieved in its glorious preceding years.
3] Ramdev baba established the PatanjaliAyurved Limited in 2006 along

with Balkrishna, with the objective of establishing science of Ayurveda in
accordance and coordination with the latest technology and ancient wisdom.
Balkrishna owns 98.6% of Patanjali Ayurved, and as of March 2018, has a net
worth of ₹43,932 crore (US$6.1 billion).
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4] Many thousands of years later, Patanjali came and saw that it had become
too complex and diversified for anyone to grasp in a meaningful way. So, he
codified all aspects of yoga in certain format knownas the Yoga Sutras. , And
so, Patanjali is known as the father of modern yoga. “Sutra” literally means
“a thread”.
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III) OBJECTIVE OF PATANJALI
1) To make a disease free world through a scientific approach to Yoga and
Ayurveda.
2) To establish a new World Health Organisation, to fulfill the resolution of
making a new world order free from disease and medicine, through
research work on the knowledge-base of our great saints and sages viz.
Maharishi Patanjali, Charak and Sushurut.
3) To establish with a scientific approach, Pran as medicine for the
treatment of all curable and incurable diseases by research on Pranayam
/ Yoga.
4) To propagate Pranayam as a “free” medicine for the treatment of
diseases round the globe, through in-depth research in accordance with
the parameters of modern medical science, so that the rich and poor may
avail its benefits in order to attain sound health.
5) Making the world a peaceful and tranquil place by using Yogic
techniques to eradicate fatal effects of medicines and weapons.
6) To study and research subjects associated with Yajna, Organic
Agriculture, Cow-Urine, Nature and Environment in addition to the
study and research in Yoga and Ayurveda at the research centre of
Institution .
7) To form a new integrated system of treatment, consisting mainly of the
techniques of Yoga and Ayurveda, for Surgery and Emergency cases,
Allopathy, Homeopathy, Unani and Acupressure to soothe patients
suffering from unbearable pains and rid them of disease.
8) To evaluate methods of treatment of Physical Body, Etheric Body,
Astral Body, Mental Body and Causal Body beyond the present
incomplete system of treatment for cure of physical body alone.
9) To begin degree and diploma courses for students in disciplines of Yoga
and Ayurveda.
10) Besides imparting Yoga and health education, to set up an equalitarian
society based on values of spiritualism, nationalism and justice beyond
the boundaries of cast, creed, class and religion for the country’s
development.
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11) To create an environment in departments of Education, Health, Forces,
Administration, Industry and Business to inspire them to adopt Yoga as
a regular & necessary practice.
12) To establish India as the strongest Economic and Cultural power in the
world to provide an atmosphere for every citizen of the world to live
with pride.
13) For realisation of dream of healthy, strong, prosperous and advanced
India, far from caste, creed, class, religion, region, corruption and
violence through Yoga.
14) To provide absolutely free lodging, boarding and free treatment for the
economically weaker sections of society.
15) To construct the building etc. for boarding and lodging for those who are
interested in Yog training and meditation.
16) To organize yoga camps in the country and abroad in order to propagate
the yoga training and the Vedic dharma.
17) To open and establish charitable hospitals for the treatment of the
helpless poor out caste and also to distribute free medicines, cloths and
food articles in the trible areas.
18) To furnish and equip the charitable hospital with modern medical
facilities.
19) To carry out research on yoga, ayurved and Vedic literature and also to
organize scholarly seminars and competitions.
20) To prepare and to sale and purchase of the Ayurvedic medicines for the
charitable hospitals, hospitals colleges, schools and for the social and
Yogic activities of the trust.
21) To make an arrangement for the study of the Veds, the Geeta, the
Philosophy, the Upnishadas, Grammer and Yogic scriptures for
character building moral cultural upliftment.
22) To prepare missionaries and facilitate them and sensitizes people for
uprooting jealousy, hate, evils, injustice, tyranny and heavenly this on
earth by keeping above the communalism, castism and the feeling of
sex, creed.
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23) To run the free educational centers and to facilitate the worthy poor
helpless orphans students by providing clothes, food, study materials and
lodging.
24) To establish and run a stables for the poor cows to save them from the
victimization and killings.
25) To carry out researches or aganihotra and perform scientific yajnas in
order to solve the serious problem of environmental pollution of the
modern age.
26) To give award and certificates to the trainees who undertake weekly,
fortnightly, monthly, quarterly and annually Yog and Acupressure
training.
27) To help and co-operate the relief activities related to flood, earthquake,
epidemic drought etc.
28) To co-operate other such institutions and organizations which match or
aims and objectives, and order to fulfill these aims and objectives to
accept the donating of money, land etc.
Importance of Baba Ramdev in Patanjali
Patanjali makes P&G nervous, its advertisement expenses signaling a new

medical multinational. In a few months, Patanjali has become a household
name. This battle has to be seen in terms of the politics of knowledge and
communication.
Transition
Ayurveda has been a medical system which knew its time was coming.
Unfortunately, Ayurveda was often presented in a reductive way as yoga, which
was only one aspect of a more cosmological theory. Second, Ayurveda became
an extension to the spirituality industry where major gurus like Sri Ravi Shankar
popularised it but as an extension of their spirituality. When one looks at an “art
of living” shop, one realises Ayurveda is only part of its spiritual
offerings. Ramdev is the first guru to make the transition from a symbolic
presentation of a civilisational idea to an actual production. The transition to
Patanjali can be seen in three steps. First, Ramdev becomes a popular and a
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populist hero by advocating yoga and claiming that Western medicine, as
practiced by MNCs, was a con game adding to the inequality in our
society. Second, this argument acquires a different pace as he hyphenates
politics with spirituality. He talks openly of the politics of medicine and makes it
a part of the wider BJP wave. Third, he moves from politics to production and
creates in Patanjali a household name to rival the likes of P&G and Hindustan
Lever. The way he does it is fascinating. First, he plays on the civilisational
unconscious which sees the indigenous as a part of wider authenticity. Second,
he merges the middle-class consumerism with traditional values by merging a
way of life and a lifestyle consciousness. He suggests health is a way of life and
then emphasises the contemporaneity of Ayurveda. Third, he widens Patanjali to
include consumer goods, cosmetics, food supplements, medicalised candy and
medicines. Instead of an overdramatised single product, what we have is a
spectrum of fascinating goods.
Heritage
Added to this was the sense of anxiety, the antics of MNCs. The vagaries that
befell Cadbury, Coca-Cola, Ponds and Nestle destroyed the immaculate trust of
consumers. The MNCs also made a mistake by attacking Ramdev’s scientific
credentials, claiming that many of his products could not stand standardisation
tests. Ramdev anticipated this by insisting on highest production criteria. But to
mere idea of standardisation, he added the trust offered by heritage. People
buying his products often sound patriotic. A visit to the Ramdev’s shop gives a
wonderful sense of plurality. There are no discount offers, salesmen look like
ordinary people with none of the peddler antics one associates with malls. Inthe
age of modernist anxiety, a housewife finds a refuge of authenticity, holding
herbs that her grandmother talked about. Ramdev’s overall strategy has a logic
which is implicit in the philosophy of Ayurveda which reads the world into
microcosms - the body - and macrocosms - the world. Mediating the two is
medicine. His advertising style also follows an Ayurvedic grammar, focusing
both on the discipline and the concreteness of the body and on the wider ecology
of religion, spirituality, ethics and well being.
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Asceticism
Unlike commodities from MNCs, Ramdev does not need stars. His asceticism
confronts the exotic and sexual feel of cosmetic and lifestyle advertisements. His
message is clear - you do not have to be a model to use my goods. His products
do not belong to the domain of conspicuous consumption. His treasure is in the
everyday-ness of goods- easily accessible, available and affordable. In fact,
Ramdev becomes both paradigm and exemplar. He is the model. However,
Ramdev understands the power of advertising. He knows he needs
advertisement to break the mental link between Maggie and Nestle. In turning
this generation to organic, he has to convince them that Ragi can be
fashionable. In that sense, Ramdev’s ads, which are tactically undistinguished,
tacitly convey an understanding of the modern world. He wants to convey that
the idea of heritage can create the ecology for a new consumerism. Yet,
Ramdev’s attempt to create Patanjali goes further. India as a nation has known
about the rapacity of MNCs, especially with CIPLA’s courageous role during
the AIDS crisis. The battle of generics against patented products is a battle India
has fought for decades. Ramdev’s Patanjali adds that same David and Goliath
quality with David being part trickster. Finally, Patanjali has been able to get its
script right. It is projected both as a fable and as a business case study,
encompassing ethics and economics in one stroke. As a study in
communication, it is impressive and generates hope for future battles around
health and democracy.
Patanjali Products
Baba Ramdev's Patanjali Ayurved has many popular products in the market.
These products easily available and are popular because of the use of natural
ingredients. Patanjali products can be also purchased from e-commerce giants
such as Amazon and Flipkart. The Haridwar based company makes a gamut of
consumer goods including personal care and packaged foods. Recently,
Patanjali Paridhan was launched in November last year to mark the entry into
the apparel market. Patanjali Products for everyday consumption include
toothpaste, soaps, honey, andatta among others. Patanjali Ayurved started as
a small pharmacy and then going on to launch a bouquet of products different
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categories and emerging a fast-growing consumer products
brand. Patanjali Products witnessed a rapid expansion with smart marketing
and affordable products. The Ayurvedic brand was started by Baba Ramdev
and Acharya Balkrishna in 2006. Also, check Patanjali Loyalty Card benefits
to save on purchase of Patanjali products.
List of Top Patanjali Products with Price
Patanjali Product Name Price
PatanjaliDantKanti (200gm) Rs. 75
Patanjali Kesh Kanti Natural Hair Rs. 75

Cleanser (200ml)
PatanjaliSaundarya Face Wash Rs. 60

(60gm)
Patanjali Ghee (500ml) Rs. 260
PatanjaliChyawanprash (1kg) Rs. 190
PatanjaliSaundarya Aloe Vera Rs. 80

Gel (150ml)
Patanjali Coconut Hair Oil Rs. 150

(500ml)
Patanjali Aloe Vera Kanti Body Rs. 15

Cleanser (75g)
PatanjaliAmla Juice (1L) Rs. 110
Patanjali Honey (1kg) Rs. 275
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Success Story of Patanjali
HUL, the largest FMCG group in India, has its back against the wall because
of the extraordinary success of the 12-year-old company, Patanjali. HUL has
re-entered the naturals space by reviving its ayurveda brand, Lever Ayush in
December 2016 and launched 20 new personal care products.The products,
priced between 30 and 130, are targeted at the mass market, thus helping
Ayush shed its premium tag. Its new tagline is Sahi Ayurveda (True
Ayurveda), with the intention of positioning the brand as an authentic
ayurvedic name. It has also partnered with one of the leading institutions
propagating the science of ayurveda ‘Arya Vaidya Pharmacy’ to develop its
new products.
However, it is yet to gain customer acceptance and it has failed to adequately
advertise its association with Arya Vaidya Pharmacy which could have
boosted consumer confidence in its products. With this current situation in
mind, we begin our analysis by performing primary and secondary research to
pin-point the variables of interest. The results are given below.
Patanjali's success
This leads us to the conclusion that Patanjali’s enormous success is attributed

to three major reasons:
✓ Baba Ramdev’s popularity and his Swadeshi rhetoric.

✓ Cost leadership.
✓ Need for chemical-free products due to increasing awareness about their
benefits amongst consumers. We also found that most of the youth consume
Patanjali products because their parents and other elders in the house do so.
This means that the younger generation, be it college goers or working
professionals, is one untapped sector in the current market.
These people realise the need of ayurvedic products but due to lack of better
options, consume Patanjali products. They are indifferent to Baba Ramdev and
would be ready to switch to better quality products if given a choice. Hence,
the youth could be the primary targets who could influence the older
generation with time.
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Marketing strategies
Because of these reasons, we propose the following marketing strategy:
1) Ayush must be targeted at the younger generation with the positioning of

science coupled with ancient ayurveda. This can depicted by its association
with Arya Vaidya Pharmacy.
2) The advertising message should be ‘Ayurveda for the modern lifestyle’.
3) The commercial should not focus only on the product features. Instead,
lifestyle or identity advertising should be used to form a connection with the
youth.
4) The brand needs to be endorsed by celebrities that connect with the younger
generation and can be associated with ayurvedic way of living. Some of the
options could be Shilpa Shetty, BipashaBasu, and Akshay Kumar.
5) HUL needs to utilise its strong distribution network by providing trade

discounts and leverage the loyalty of its traders to push selling. The retailers
can focus on the innovative products like Cardamom Toothpaste, Saffron Soap
and Fenugreek Shampoo.
6) Patanjali’s swadeshi stand could be diluted due to its recent associations

with foreign funded e-commerce sites and retailers, giving HUL some relief on
that front.
7) HUL can also open up health centres to provide the complete Ayush therapy
experience.
8) It must focus on the southern States and rural areas where Patanjali’s reach
is low and loyalty for Ayurveda is high. With these incentives, it could rope in
Rajnikant.
9) It should also emphasise its international quality standards to prove its

authenticity and superiority over other available ayurvedic products.
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Trial runs
The following marketing strategies could be used to induce trials in the youth.
College students
1. Social media campaigns and contests.

2. Sponsoring college festivals.
3. Promoting the brand at malls, cafes and gyms.
4. Rolling out case study contests to engage the youth.
Working professionals
I. Corporate deals in the form of vouchers for performance awards, birthday

occasions and anniversaries.
II. Promoting benefits of Ayush to treat skin problems caused by everyday stress.
Apart from this, the older generation could be also attracted by selling Ayush
products in moving vans near parks in the morning to increase sales. This
would help the brand to associate itself with health-conscious individuals.
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The Future of Patanjali
PAL is a Trend setter in the Indian FMCG sector. It has grown at a

phenomenal pace in the last half a decade. Growth in demand has put pressure
on the pace of production to satisfy the rising needs of consumer.
• Today, PAL has one manufacturing plant in the holy city of Haridwar but
Patanjali Ayurved will require more production facilities to cater to the rising
demand of its products in the country. So PAL has decided to establish 4 more
manufacturing units in the country.
• The planned manufacturing plants may come up in the states of Maharashtra,
Punjab, Andhra Pradesh and Madhya Pradesh. PAL wants to set up its new
manufacturing plants closer to raw material source. Easier and Direct
availability of raw material will also bring down the cost of production.
• Rs. 1000 Crores has been earmarked for the expansion this fiscal. The
Finances will be arranged from the internal accruals and loans from SBI and
Punjab National Bank.
• Patanjali Ayurved is also entering into the dairy segment with the packaged
cow milk. The company has already acquired a dairy plant in Ahmednagar,
Maharashtra with a plant capacity of 12 lakhs litre/day but the company is
Investing more money in the facility to increase its daily output to 70-80 lakhs
litre/day.
• Patanjali has also pledged to plough back majority of its profits in operations,
which in turn will help PAL better its position in the growing market.
Will PAL reach a turnover of close to USD 1.5 billion (RS. 10000 Crore) this
fiscal or an ambitious turnoverof close to USD 3 billion (Rs. 20000 Crore) by
2020?
Whatever the answer to these questions is, nobody can take the success away
from both Baba Ramdev and Acharya Balkrishna at the present moment. The
distruptive force that they have created in the Indian FMCG industry is set to
benefit to the consumer for a long time to come.
26
Ratio Analysis
Introduction
The term “ratio analysis” refers to the analysis of the financial statements in
conjunction with the interpretations of financial results of a particular period of
operations, derived with the help of ‘ratio’. Ratio analysis is used to determine
the financial soundness of a business concern.
In this blog post, we will introduce ratio analysis, what it is used for, what are
the advantages and disadvantages of it and its limitations.
What is Ratio?
A Ratio is one figure expressed in terms of another figure. It is mathematical

yardstick that measures the relationship between two figures, which are related
to each other and mutually interdependent. Ratio is expressed by dividing one
figure by the other related figure. Thus, a ratio is an expression relating one
number to another. It is simply the quotient of two numbers. It can be
expressed as fraction or as a decimal or as a ratio or in absolute figures as ‘so
many times’. An accounting ratio is an expression relating two accounts or two
sets of account heads or groups contained in the financial statements.
What is Ratio Analysis?
Ratio Analysis is the method or process by which the relationship f items or

groups of items in the financial statements are computed, determined and
presented.
Ratio Analysis is an attempt to derive quantitative measures or guides

concerning the financial health and profitability of a business enterprise. Ratio
Analysis can be used both in trend and static analysis. There are several ratios
at the disposal of an analyst but the group of ratios he would prefer depends on
the purpose and the objectives of analysis.
Meaning and Definition of Ratio Analysis
Ratio analysis is a conceptual technique which dates back to the inception of

accounting, as a concept. Financial analysis as a scientific tool is used to carry
27
out the calculations in the area of accounting. In order to appraise the valid and
existent worth of an enterprise, the financial tool comes handy, regularly.
Besides, it also allows the firms to observe the performance spanning across a
long period of time along with the impediments and shortcomings. Financial
analysis is an essential the mechanism for a clear interpretation of financial
statements. It aids the process of discovering, the existence of any cross-
sectional and time series linkages between various ratios.
Formerly, Security qualified as a major requisite for banks and financial

institutions, to co and grant loans and advances. However, there’s been a
complete paradigm shift in the structure.
Currently, lending is based on the evaluation of the actual need of the firms.
Financial viability of at he proposal, as a base to grant loans, is now been
given precedence over security. Further, an element of risk is imperative in
every business decision. Credits, run a higher risk, as a part of any decision
making in business and so, Ratio analysis and other quantitative techniques
mitigate the risk to some the extent by providing a fair and rational assessment
of risks.
Ratio analysis broadly explains the process of computing, acts as a vital tool in
determination and presentation of the relationship of related items and groups
of items of the financial statements.
The financial position of a unit is concretely and clearly encapsulated by the

means of ratio analysis. The significance of Ratio Analysis for a holistic
Financial Analysis remains unflinchingly supreme.
Ratio can be used in the form of a percentage, Quotient, and Rates. In other
words, it can be expressedas a to b; a: b (a is to b) or as a simple fraction,
integer and decimal. A ratio is calculated by dividing one item or figure by
another item or figure.
28
Statements of Ratios
Balance Sheet Ratio Revenue Statement Ratio

1. Current Ratio 1.Gross profit ratio
2. Liquidity Ratio 2. Operating ratio
3. Proprietary Ratio 3. Expenses Ratio
4. Stock-Working Capital 4. Net Profit Ratio
5. Capital Gearing Ratio 5. Stock-Turnover Ratio
Historical Background
During the later half of the 19th Century, the bankers have used accounting
ratios for analysing a prospective debtor’s credit standing. But, their analysis
was very much restricted to the study of current ratios alone.
It was in 1919, Alexander will came out with his strong criticism of such a
restricted and narrow analysis and pointed out the possible dangers of such an
analysis. He maintained that, in order get a clear picture of the financial health
of business, one has to take into account various other relationships besides the
current ratio. Since then, ratio analysis come a long way in being an efficient
tool of financial statement analysis.
Objectives of Ratios
Ratios are worked out to Analyse the following aspects of a business

organisation:
1. Solvency:
i. Long-term,
ii. Short-term,
iii. Immediate.
2. Stability.
3. Profitability
4. Operational Efficiency
5. Credit Standing
29
6. Structural Analysis
7. Effective utilisation of resources
8. Leverage or external financing.
Nature of Ratio Analysis
It is better to understand the nature of ratios so that they can be employed

judiciously under appropriate conditions.
1. The relation between two or more financial data brought out by an accounting
ratio is not an end in itself. They are, means to get to know the financial
position of an organisation.
2. An individual ratio may not be capable of providing the answers required for
the various problems facing an executive. Individual ratios may provide
valuable information only when they are studied and compared with several
other related ratios.
3. Ratio analysis will tend to be more meaningful when certain standards and
norms are laid down so that what the ratios indicate can be compared with the
said standards. This provides a base for decision-making and assists in taking
measures to rectify any drawback or deficiency.
Ratios
(In the viewpoint of users)
Shareholders Long-term Short-term
Creditors Creditors
1.Earnings per 1. Debt- 1. Liquidity
Share Ratio Equity Ratio Ratios
etc. 2. a) Current Ratio
Shareholder’s b) Quick Ratio
Equity to 2. Stock-
Total Equity Turnover
Ratio Ratio
3. Long-term 3. Debtors’
Funds to Turnover
Fixed Assets Ratio
Ratio etc.
30
Complication of Ratios
Ratios analysis is rightly considered as an invaluable tool of analysis.

However, one has to exercise considerable degree of caution while analysing
the financial statements with the aid of ratios. The precautions one has to take
in ratio analysis are listed below:
❖ Firstly, It is essential to ensure that the persons who use the ratios understand
the terminology and the component figures employed for compiling.
❖ Secondly, the ratios to be compared should be capable of being compared
validly. In other words, the data found in financial statements have to be
horizontally consistent over a period of time.
❖ Thirdly, Compilation of ratios has to be done speedily. They have to be
worked out and supplied to the different users in time for further action.
❖ Fourthly, ratios have to be presented in an appropriate manner. It is an usual
practice to set out the major ratios first followed by less important ratios and
then finish with the least important ones.
❖ Fifthly, A complete record of ratios is essential. Vertical form of presentation
is considered more useful and appropriate for Ratio analysis.
31
Standards for Comparison
While interpreting financial statements Benchmark i.e. yardstick should be

considered. In order to make judgement about financial status, actual ratio has
to be compared with the yardstick. Benchmark may be:
1. Past Ratio – The Past Ratio of the same organization may be considered as an
yardstick. This type of comparison is known as Intra-firm comparison.
2. Ratio of Competitive firms – The ratio of the competitive firms may be
considered as an yardstick for comparison. It is called Inter-firm Comparison.
3. Industry Average – In this case, average ratio at the industry level may be
considered as an yardstick against which the actual ratio is compared to draw
conclusions.
4. Rule of Thumb – Rule of Thumb has been evolved over a period of time. A
ratio could be compared with the rule of thumb. For example current ratio rule
of thumb is 2:1 Quick ratio is 1:1.
32
Meaning of Different Ratios
Meaning
➢ Leverage Ratio
These ratios measure the relationship between Proprietors’ funds and

borrowed funds. They indicate the degree of debt-financing in a firm.
A leverage ratio is any one of several financial measurements that look at how
much capital comes in the form of debt (loans) or assesses the ability of a
company to meet its financial obligations.
Significance
The leverage ratio category is important because companies rely on a mixture

of equity and debt to finance their operations, and knowing the amount of debt
held by a company is useful in evaluating whether it can pay its debts off as
they come due.
➢ Profitability Ratio
These Ratios are intended to reflect the overall efficiency of the organization,
its ability to earn a reasonable return on capital employed or on shares issued
and the effectiveness of its investment policies. Profitability ratios are a class
of financial metrics that are used to assess a business's ability to generate
earnings relative to its revenue, operating costs, balance sheet assets, and
shareholders' equity over time, using data from a specific point in time.
Significance
Profitability ratios are financial metrics used by analysts and investors to

measure and evaluate the ability of a company to generate income (profit)
relative to revenue, balance sheet assets. Liquidity is the ease with which a
firm can convert an asset into cash.
➢ Liquidity Ratio
A liquidity ratio is a financial ratio that indicates whether a company's current

assets will be sufficient to meet the company's obligations when they become
due. These ratios analyse short term and immediate financial position of a
33
business organization and indicate the ability of a firm to meet its short term
commitments (current liabilities) out of its short term resources (current
assets). They are also known as ‘Solvency Ratios’.
Significance
Liquidity ratios are an important class of financial metrics used to determine a

debtor's ability to pay off current debt obligations without raising external
capital. Current liabilities are analyzed in relation to liquid assets to evaluate
the coverage of short-term debts in an emergency.
➢ Performance Ratio
The performance ratio is a measure of the quality of a PV plant that is

independent of location and it therefore often described as a quality factor.
The performance ratio (PR) is stated as percent and describes the relationship
between the actual and theoretical energy outputs of the PV plant. This is also
known as Activity Ratio.
Significance
The performance ratio is one of the most important variables for evaluating
the efficiency of a PV plant. Specifically, the performance ratio is the ratio of
the actual and theoretically possible energy outputs.
➢ Efficiency Ratio:-
The efficiency ratio is typically used to analyze how well a company uses its
assets and liabilities internally. An efficiency ratio can calculate the turnover
of receivables, the repayment of liabilities, the quantity and usage of equity,
and the general use of inventory and machinery. This ratio can also be used to
track and analyze the performance of commercial and investment banks. This
is also known as Activity Ratio.
Significance
The efficiency ratio is typically used to analyze how well a company uses its
assets and liabilities internally. An efficiency ratio can calculate the turnover
of receivables, the repayment of liabilities, the quantity and usage of equity,
and the general use of inventory and machinery.
34
➢ Current Ratio
The current ratio is a liquidity ratio that measures a company's ability to pay
short-term obligations or those due within one year. It tells investors and
analysts how a company can maximize the current assets on its balance sheet
to satisfy its current debt and other payables.
Significance
The current ratio is a test of the credit strength and solvency of an

organization. Current Ratio indicates the strength of the working capital of the
business enterprise. It indicates the company’s ability to meet its day-to-day
financial obligations. The Ratio discloses possible tendencies of the business
to over trade or under capitalise or over invest in stocks.
➢ Proprietary Ratio:-
Proprietary Ratio is a test of the financial and credit strength of the business. It
relates shareholders funds to total assets i.e. total funds. This ratio determines
the long term or ultimate solvency of the company. In other words Proprietary
ratio determines as to what extent the owners interests and expectations are
fulfilled from the total investments made in the business operations.
Significance
The proprietary ratio shows the contribution of stockholders' in total capital of

the company. A high proprietary ratio, therefore, indicates a strong financial
position of the company and greater security for creditors. A
low ratio indicates that the company is already heavily depending on debts for
its operations.
➢ Inventory Turnover Ratio:-
Inventory turnover is a ratio showing how many times a company has sold and
replaced inventory during a given period. A company can then divide the days
in the period by the inventory turnover formula to calculate the days it takes to
sell the inventory on hand.
35
Significance
The inventory turnover ratio, also known as stock turnover ratio, is one of the
key figures used to evaluate the efficiency of a company in handling the goods
it manufactures or buys to resell. Like any metric calculated by using
information from the financial statements, the turnover ratio has limitations.
➢ Debtors Turnover Ratio:-
The accounts receivable turnover ratio is an accounting measure used to

quantify a company's effectiveness in collecting its receivables or money owed
by clients. The ratio shows how well a Company uses and manages the credit
it extends to customers and how quickly that short-term debt is collected or is
paid. The receivables turnover ratio is also called the accounts receivable
turnover ratio.
Significance
This ratio indicates the degree of management of debtors or sales. The

high debtors turnover ratio refers to effective management of sales
or debtors and liquid of debtors and vice versa. There is no rule of thumb or
standard ratio for Debtors Turnover Ratio.
➢ Quick Ratio:-
The quick ratio is an indicator of a company’s short-term liquidity position and

measures a company’s ability to meet its short-term obligations with its most
liquid assets. Since it indicates the company’s ability to instantly use its is also
called the acid test ratio. An acid test is a quick test designed to
produce instant results near-cash assets (assets that can be converted quickly to
cash) to pay down its current liabilities, it
Significance
The quick ratio is very useful in measuring the liquidity position of a firm. It
measures the firm's capacity to pay off current obligations immediately and in
36
a more rigorous test of liquidity than the current ratio. It is used as a
complementary ratio to the current ratio.
FORMULAS
Leverage Ratio
➢ Debt to Equity = Total Debt/Total Equity

➢ Debt to Asset = Total Debt/Total Asset
➢ Asset to Equity = Total Asset/Total Equity
Profitability Ratio
➢ Return on Fixed Asset = Net Profit / Total Fixed Assets

➢ Return on Equity = Profit After tax / Net worth,
➢ Return on Capital Employed = Net Operating Profit / Capital Employed*100
Liquidity Ratio
➢ Quick Ratio = (Cash + Short-term Marketable Securities +

Receivables)/Current Liabilities
➢ Current Ratio = Current Assets/Current Liabilities
Performance Ratio
➢ Gross Profit Margin = Gross Profit/Net Sales*100

➢ Operating Profit Margin = Operating Profit/Net Sales*100
➢ Net Profit Margin = Net Income/Net Sales*100
Efficiency Ratio
➢ Total Asset Turnover = Revenue/Total Asset

➢ Fixed Asset Turnover = Revenue/Total Fixed Asset
➢ Inventory Turnover Ratio = COGS/Inventory
37
CHAPTER NO.02
RESEARCH METHODOLOGY
This is a descriptive type of research which emphasizes on fact finding analysis and
investigation with proper data interpretations. For the purpose of study data is collected
in one way i.e. Secondary Method.
Title: Ratio Analysis of Patanjali
Objective of the Study :
1) To know about the role of Ayurvedic Product in Modern days.

2) To know about the Importance of Patanjali in Our Life.
3) To know about the History of Patanjali.
4) To know about the SWOT and PESTLE Analysis of Patanjali.
5) To know about the how Patanjali product become FMCG products.
6) To know about the objective of Patanjali to Enter in the market.
7) To know the success story of Patanjali.
8) To know the Importance of Baba Ramdev in Patanjali Company.
9) To Analysing financial ratio of the company.
10) To know about Why Patanjali Products was fall down In the Year 2018-2019.
11) To know about what Challenges faced by the Patanjali Company.
38
Scope of the study
❖ This project report is all about Ratio analysis of Patanjali. It covers every detail as to
Why Patanjali Product is FMCG Product and What are the SWOT and PESTLE
analysis of Patanjali.
❖ The project report begins with a short overview about Company Profile of
Patanajali. Then it proceeds about what is Ratio Analysis. Later the report covers the
brief of the history and Objective of Patanjali. The project also covers Importance of
Baba Ramdev in Patanjali and List of Patanjali Products.
❖ It also covers the Ratio Analysis of four financial Year i.e. 2011-2012, 2012-2013,
2013-2014, 2014-2015. It also covers the financial report i.e. Balance sheet, Income
Statement, Cash flow Statement and Revenues (In Crore) of Patanjali.
❖ It also covers 4 – P Analysis, Industry Analysis, Positive And Negative Review of
Products and Success story of Patanjali.
39
Limitations of the Study
The following are some of the anticipated challenges that the researcher is
likely to face in the due course of the study.
There are many challenges faced by the Researcher. Financial Report of

Patanjali is very difficult to Find. Financial Report i.e. Balancesheet, Income
statement, Cash Flow Statement was found for the financial Year 2011-2012,
2012-2013, 2013-2014, 2014-2015 But Financial Report of the year 2017-
2018, 2018-2019 was not found.
Data collection Method
Information has been collected from Secondary Data.
SecondarySources:-
Secondary data are those which have already been collected by someone else
and which already had been passed through the statistical process. The
secondary data was collected through various Websites, Articles, Newspapers,
Magazines and Different Books.
40
CHAPTER NO. 03
REVIEW OF LITERATURE
1. Braz J Med Biol Res, Ribeirao Preto[2000],the pattern in each of the

studies and genetically improvement as domestication, production and
biotechnological of medicinal plants, instead of the use of plants harvested in
the wild, will offer great advantages, since it will be possible to obtain uniform
and high quality raw materials which are fundamental to the efficacy and
safety of herbal drug
2. Sk. Md. Nizamuddin [2000],highlights the importance , tools and

techniques of Advertisement and sales promotion . He brought the promotion
mix models. The advertising was a message to promoted an idea of good or
service been communicated by one or more media through identified sponsors
whereas the sales promotion focused on short term incentives provided by
sponsors to their consumers /traders and persuaded them to purchased and
stock the promoted stock . Promotion was included Advertising, Personal
selling , Sales promotion , Publicity and direct marketing.
3. C. R. Kothari[2004],brings the importance of Research highlights that it is a

journey from Known to unknown . Highlights various research methodology
from descriptive , case study , experimental , historical and criteria for good
research . It guides on to prepare the research design , determining the sample
design , collection of data , execution of the project , analysis of data using
various statistical tools and techniques for hypothesis testing . He moves and
describes how to generalize and interprets the results . Finally explains in
details preparation of the thesis .
4. Lakshmi Chandra Mishra [2004],Ayurveda is more a way of life then an

treatment and Ayurveda concept is equilibrium of dosha (humor), agni
(digestive fire), dhatu (seven body tissues: lymph, blood, muscle, adipose
tissue, bone, bone marrow, semen), and mala (feces, urine, and other waste
products).To promote image or any system of the country to global world the
41
Government plays a vital and meaningful role through ISM policy along with
enforcement of Good manufacturing practices ( GMP)
5. Alok Sharma et.al [2008],describes the safety , efficacy and acceptability of

Ayurvedic medicine due to no or very less side effect and many patients have
got their cure . With this strong base author deals with measure to be adopted
to take this medicinal field on global footprints. Herbal drug development is
possible only through the development of standardized herbal products.
6. Pandey Shivanand [2010],brings the review of Indian Pharmaceuticals

becoming the major global pharma companies. As a revolution in 1972 to
produce the medicine at cheaper cost Govt. allowed to produce the drug
through reverse engineering the patent. With this the procurement model of
importing API stopped and indegionous API production began. Making India a
global player in formulation as well as API.
7. Mahesh T S et.al[2011], in their article the main objective of researchers is

to determine the influence of marketing, its concepts on the sale of Ayurvedic
drugs. Among the various marketing element the product and its quality is a
prime factor of sales accompanies by good product promotional strategies.
Pricing and availability do have their impact but definitely with low intensity.
8. Marc J. Roberts, Michael R. Reich [2011],In this book author brings out
the importance of Flagship framework and it is based on the argument that the
effective policy development has to start by identifying the performance
deficiencies that is the outcome the reformer want to improve. Reformer needs
to be assisted with the analytical tools to continually monitor , measure and
track
9. Patel Vishal et.al [2011],in line with guidelines of WHO for manufacture
quality and standardization Author presents the various facets of the methods
of different aspects of development and manufacture quality / standardization
of herbal drugs . For herbal medicine to have respected place in contemporary
health care system then the quality with standards is paramount
10. Rajendra Kumar Jain, [2011],The author in his document intents to

analyse Ayurveda product export with objective to critically appraise the
42
potential for herbal ayurvedic products and identify the problems and
prospects of these in select African Countries. It is paramount to understanding
of regulatory requirements of different countries and for this Government help
is needed.
11. RAMESH U KURIAN JOSEPH[2011],with widely accepted Ayurveda

across globe authors in his papers brings out the immense acceptance and
scope to make India Wellness industry to attract the foreign tourist . The study
brings out the most favorable factor for kerala with its authenticity and rich
Ayurvedic heritage with multifaceted attractions
12. Arthur G Cook [2011],brings out the need for the forecast in
pharmaceutical industry and how forecasting can drive the decision making
process . It is vital to know the use to which the forecast will be directed which
are in markets or for a specific country/territory? Forecasting tools needs to be
balance between the process focus and technical focus as it should have
maximum utilization. The best approach is to blend the qualitative factors into
the quantitative framework that creates the revenue and unit expectations for a
product .Resources needs to be linked to the forecast which is most delicate
thing
13. Ainary Arun Kumar, T Sowmyya[2012],Though Ayurveda as a

medicinal system stood the test of the time for any new initiative like Ayush
there is a need to have proper marketing strategy not only to make the profit
but keep the sustenance . The marketing strategy need to have both short term
and long term strategy to keep the enterprise in the soul and mind of the people
.
14. Philip T. Kotler, Kevin Lane Keller [2012],highlights prime functions of

marketing function of the organization creating, communicating and delivering
value to the customer couple with Customer relationship management to
benefit its stakeholders and organization .He highlights key concepts –
production , product , selling marketing and holistic marketing concept
.Development of marketing strategies and plans followed by capturing insights
, building strong brands ,connecting with customer , shaping market offering ,
delivering and communicating value and creating long term growth .
43
15. P. VAIJAYANTHI et. al, [2012],The author in his document intents to
analyze the status of Ayurvedic medicines using Porters Five Forces Model
focusing on the marketing issues from the perspectives of the practitioners
(doctors), distributors, service providers (hospitals) and the customers. The
findings of the study indicate that paucity of scientific endorsement (clinical
tests) to be the most heavily felt impediment to Ayurvedic practice
16. M. K. Maru [2012],brings the close relation traditional / ancient medicine

Ayurveda and treatment with growing tourism industry, which not only helps
in Employment , but has a large impact in GDP , Indian economy and foreign
exchange, hence govt. ha declared this as a high priority sector . Under the
Ministry of Tourism “Incredible India " Yoga/Ayurveda/Wellness has been
promoted over the last two years in the print, electronic, internet and outdoor
medium
17. SWATI KEWLANI, SANDEEP SINGH[2012],brings out the risk ,

challenges and rewards to Auyrvedic companies while they establishes success
in the rural India where the behavior varies based on occupation, income,
social and cultural grouping. Consumer’s perception towards traditional
therapy in villages is very positive and natural acceptance .
18. Harish B. Bapat, Vishal Khasgiwala[2013],Author analyses Patanjali

stores and all of them had experience the product shortage. Even though there
is a shortage of the product availability the consumer or patient makes multiple
trips to find whether the new stock is come or not. Factor author brings out
that the demand is primarily driven by the value for money and quality of the
product with a package of yoga education
19. Sanjay Kavishwar,Vijay N. Bidwaikar[2013],With changing preference

of women from chemical based cosmetic to safe, reliable and affordable herbal
cosmetic , this has opened a new channel of marketing a beauty Parlours. Most
of the SME involves these parlours as a channel partner for sales promotion
activities as this turns out as a cost effective route .
20. Bahram Ranjbarian et.al [2013] Although the impact of chemical

medicine have been proven , yet the pickup for herbal medicine is still slow.
Hence author with data concludes that there is a positive impact of marketing
44
mix of herbal medicine and the doctor’s involvement about these drugs
influences the prescription of the herbal drugs and this outcome was consistent
21. Rohit Bhattacharya et.al[2014],The author in his document intents to

analyse and critically appraise the potential of herbal Ayurvedic product and
identify the problems and prospects of this sector. He highlights the challenges
which is contracting our export growth like poor agricultural practices, lack of
R&D , poor quality control procedure , Lack of regulatory mechanism etc.
22. Garima Malik ,Himanshu Sachdev [2015], Author in this journal brings
out the attention on the factors affecting on the consumer’s behaviors by
various sales promotional tools while shopping online . Author highlights the
positive impact of these tools but also state with caveat that at times it goes
negative on consumer due to their feeling of being cheated using the
promotional tools affecting the brand loyalty among the consumers ultimately
resulting in sales plunge and overall hampers and impact the brand image .
23. ShomnathDutta[2015],highlights the pursuit of a healthy lifestyle Indian

has become more inclined to Ayurvedic or Herbal therapy as alternative
healthcare for natural cure. He attempts to note the reasons for revolutionary
success of Baba Ramdev’s brand Patanjali with the intelligent use of mass
customization and content marketing mainly focus on product quality and low
price messaging value for money .
24. Suvarna M. Deshpande [2015],On the current attitude of consumer

worldwide is to go for green authoron the study of current Market Scenario &
Marketing prospects against hanging Attitude of consumer Conscious efforts
are, therefore, required to promote the therapeutic aspects of ayurveda as a
system, so that it can emerge as a distinct contender in the pluralistic
healthcare market, rather than a supplier of some “safe” herbal remedies for
the international market for complementary and alternative medicines
45
25. Gomathi D, MurugananthamS[2016],brings the success of Patanjali with
less than decade as compared to the major player with brands for several
decades . Baba Ramdev came up with unique package model of Ayurveda
couple with pranayama . His products were only available to start with in
patanjali stores and now everywhere including online . The USP of Patanjali
products is superior quality with low price
46
CHAPTER NO. 04
DATA ANALYSIS
Ratio Analysis of Patanjali
Ratios Formula 2012 (%)

Leverage Ratio
1.Asset to Equity Total Asset/Total Equity 5375/1611 = 3.34%
Profitability Ratio
1.Return on Fixed Asset Net Profit/Total Fixed Asset 559/2563 = 0.22%
2.Return to Equity Profit After tax / Net worth, 559/4512 = 0.12%
3.Return on Capital EBIT/ Capital Employed*100 1064/2923 = 0.36%
Employed
Liquiditity Ratio
1.Quick Ratio (Cash + Short-term 51+691/2452 = 0.30%
Marketable Securities +
Receivables)/Current
Liabilities
2.Current Ratio Current Assets/Current 2585/2452 = 1.05%
Liabilities
Performance Ratio
1.Gross Profit Margin Gross Profit/Net Sales*100 702/4512*100 = 0.156%
2.Net Profit Margin Net Income/Net Sales*100 1403/4512*100 = 0.31
Efficiency Ratio
1.Total Asset Turnover Revenue/Total Asset 4539/5375 =0.84%
2.Fixed Asset Turnover Revenue/Total Fixed Asset 4539/2563 = 1.77%
47
Leverage Ratio
Profitability Ratio
Employed
Liquiditity Ratio
Liabilities
Liabilities
Performance Ratio
1.Gross Profit Margin Gross Profit/Net Sales*100 952/8439 = 0.11%
2.Net Profit Margin Net Income/Net Sales*100 1569/8439*100 = 0.19%
Efficiency Ratio
1.Total Asset Turnover Revenue/Total Asset 8490/5968 = 1.42%
48
Leverage Ratio
Profitability Ratio
2.Return to Equity Profit After tax / Net worth, 1547/11867*100 = 0.13%
Employed
Liquiditity Ratio
Liabilities
Liabilities
Performance Ratio
2.Net Profit Margin Net Income/Net Sales*100 2472/11867 = 0.21%
Efficiency Ratio
1.Total Asset Turnover Revenue/Total Asset 11946/7591 = 1.57%
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Leverage Ratio
Profitability Ratio
Employed
Liquiditity Ratio
Liabilities
2.Current Ratio Current Assets/Current 10,896/6423 = 1.69%
Liabilities
Performance Ratio
2.Net Profit Margin Net Income/Net Sales*100 4655/20067 = 0.23%
Efficiency Ratio
1.Total Asset Turnover Revenue/Total Asset 20141/13628 = 1.48
2.Fixed Asset Turnover Revenue/Total Fixed Asset 20141/2267 = 8.88
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Revenues
Year Revenues (inCrore)
2010-11 100
2011-2012 300
2012-2013 841
2013-2014 1184
2014-2015 2006
2015-2016 5000
2016-2017 11526
2017-2018 8135
2018-2019 8330
In FY 2016-2017, PatanjaliAyurved contributed Rs 9,634 crore to its turnover,

while Divya Pharmacy that manufactures ayurvedic medicine had clocked Rs
870 crore sales.The Haridwar-based FMCG firm had clocked a turnover of Rs
10,561 crore in the financial year ended March 31, 2017.Patanjali had reported
revenue of Rs10,561 crore for the year ended 31 March 2017, more than
double the Rs5,000 crore in the previous year.Baba Ramdev, the yoga guru-
turned-businessman, had on 4 maysaid that Patanjali would continue to
“double revenue every year" to cross Rs20,000 crore in the year ended March
2018 and subsequently would cross the annual revenue of India’s largest
packaged goods company Hindustan Unilever Ltd by 31 March 2019.Baba
Ramdev'sPatanjaliAyurved reported revenue of Rs 8,329.7 crore in the year
2018-19, the company said in its annual return filling. It is a marginal increase
of 2.38 per cent from the previous financial year. The company did not report
any profit or loss for the period.
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Total Income & Profit
Profit and Income are shown in the graphical picture above. All Amount in the
Figures are in Crore. Blue colour is for Total Income and Red colour is for
Profit After Tax.
In the FinancialYear 2009-2010 Total Income was 163 and Profit After Tax
was 33. Income and Profit After tax are Very Low in this Year.
was 68.
was 56.
was 76.
was 155.
Income and Profit After tax are Very High in this Year.
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There Are Four Top Advertised Patanjali Brands.
Four Top Brands name is Dant Kanti, Soap, Aloe Vera Gel, Herbal Washing
Powder.
There are 50,291 range of products.
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Information of Graphical picture are for Four Years 2016,2017, 2018, 2019.
In the Year 2016 sales are 4,812 Crores.
In the Year 2017 sales are 9,006 Crores. Maximum Sales are Made in this
Year.
In the Year 2018 sales are 8126 Crores.
In the Year 2019 sales are 4701 Crores. Minimum Sales are made in this Year.
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There are Three years of Raw Material conversion period in above graphical
Picture.Green colour is for the year 2016-2017. Red colour is for the year
2017-2018. Dark Blue colour is for the year 2018-2019.
There are top Five Brands are mentioned in above picture i.e. Britania, Amul,
Nestle, Patanajli, HUL. In the year 2016-2017, Raw material conversion
period of Patanjali is 2.5%.. Inthe year 2017-2018, Raw material conversion
period of Patanjali is 5.3%. In the year 2018-2019, Raw material conversion
period of Patanjali is 5.4%.
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Patanjali are the Second Consumer coverage Brand of India. Revenues of
Patanjali are 10561.0 Crore.
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In the above Picture Patanjali Best Sellers are mentioned i.e. Ghee,
Toothpaste, Ayurvedic Pharmacy, Hair Oil, Herbal Soap. IN Red Colour
Patanjali Revenues are shown in Crores and In Silver colour % Calculated in
total. Revenue and % of Ghee is 1467 Crores and 13.9%.
Revenue and % of Toothpaste is 940 Crores and 8.9%.
Revenue and % of Ayurvedic Pharmacy is 870 Crores and 8.2%.
Revenue and % of Hair Oil is 825 Crores and 7.8%.
Revenue and % of Herbal Soap is 574 Crores and 5.4%.
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IN the above Picture Pricing of different Products are mentioned. In this
picture Product Name, Quantity, Patanjali Product Price and Discount are
shown. Patanjali Product Price are compared with other Brands price.
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Financial Report of the year 2018-2019
Operating Revenue over INR 500 cr.

EBITDA 13.21%
Net worth 13.82%
Debt-Equity Ratio 0.75
Return on Equity 12.14%
Total Assets 13.31%
Fixed Assets 3.07%
Current Assets 14.23%
Current Liabilities 17.31%
Trade Receivables 33.20%
Trade Payables 78.84%
Current Ratio 1.22
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SWOT Analysis of Patanjali
Strength
Strengths describe the factors that which the organization is good at and what
separates it from its competitors.
• Baba Ramdev: The exponential growth of Patanjali can be credited to Baba

Ramdev and his popularity. For a newly formed FMCG in India, it would have
been impossible to show the kind of growth that Patanjali has shown in such a
short period of time. But the fan following and goodwill of Baba Ramdev
guaranteed that Patanjali grows quickly and becomes a routine name in the
Indian households.
• Strong Patriotism: Patanjali has used the India card to its advantage and has
always marketed that it’s a brand made in India, for Indians. Most of the
brands in India are international brand. Patanjali actively asks Indians to buy
India made products to help the economy of the country. Besides this, the
quality of the products have helped in the fantastic growth of Patanjali.
• Ayurveda and Herbal: The Products that Patanjali offers are made from
Ayurveda and Herbal natural components. The Swadeshi products also have
played an important role in the success of Patanjali. India has never been low
on plants or vegetation and we get a lot of naturally grown medicines in our
dense forests. As a result, India is one of the leaders in Ayurveda.
• Penetration Pricing: Patanjali products are generally priced at 20-30 % lower

than the competitive brands and thus it becomes impossible for the competitive
brands to compete with Patanjali on price. The company sources the products
directly from farmers and thus cuts on middlemen. Hence, they are able to
produce at lower costs. A comparison of prices for some products is given
below are given below.
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Price Patanjali Other Brands
Comparison
Chyawanprash Rs.115 Rs.160

(500gm) (500gm)
Honey Rs.135 Rs.199

(500gm) (500gm)
Shampoo Rs.110 Rs.159

(200gm) (200gm)
• Strong Distribution channels: Patanjali products are sold through medical

centres such as Patanjali Chikitsalayas and Patanjali Arogya Kendras, non-
medical centres such as Swadeshi Kendras. Patanjali already has 15,000
outlets across India. Patanjali was earlier criticised for its distribution strategy,
but it has now improved it by distributing through General retail outlets and
has recently tied up with the Future group for distribution through Modern
retail. They have now transformed its weakness into a strength.
• E-commerce advantage: Patanjali sells very well through the E-commerce

companies and has a lot of packages of products which it sells online. So even
if people are not nearby a Patanjali store, but they believe in Baba Ramdev or
want to purchase Indian products, then they can do so online via E-commerce.
• Word-of-Mouth Promotion: For a new company especially in the
consumer goods category, a high share of its expenditure goes into
advertisements and promotions. Patanjali followed a word-of-mouth
promotion strategy initially and did not spend much on promotions and
advertising. Patanjali depended on over the Brand loyalty of its customers.
• Keeping up with the trends: Owned by Babas and Swamis, Patanjali was
supposed to be a conventional Indian company but it has surprised everyone
by bringing in various changes required to be at par with its contemporary
brands. Be it advertising using celebrities as Brand ambassadors, Entering
modern retail or using E-commerce as a platform. Patanjali has also
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understood the potential of digital media and social media platforms and is
also spending on these channels.
• Launch of New Products: Patanjali has recently launched a number of new

products. The company has ventured into the dairy sector and now offers cow
milk, flavored milk, curd, buttermilk, and cheese. In an official press
statement, the brand commented that it produced 4 lakh liters of milk on the
first day of the launch. Additionally, Patanjali now also offers frozen
vegetables like peas, sweet corn, and mixed vegetables. This puts Patanjali in
direct competition with McCain. Patanjali also plans to launch its own
packaged drinking water, named as Divya Jal. Furthermore, the company
plans to offer urea free cattle feed and solar production.
• Wide Range of Product: One of the biggest strengths of Patanjali is the wide
variety of products that it has in its product mix.
• Aggressive marketing and promotion: Switch on your Television or any
new channel the only ad which is on the loop is of Patanjali. Patanjali knew
that in order to make the most of the first mover advantage (in Herbal and
Ayurveda product segment) they would need to promote their brand and
products heavily and that is what they did. Patanjali spent heavily on
advertising and marketing so as to make people aware of their products and
brand and they very well succeeded in it.
Weaknesses
Weaknesses stop an organization from performing at its optimum level. They

are areas where the business needs to improve to remain competitive:
• Over Dependency on Baba Ramdev

The company relies heavily On Baba Ramdev himself. The man is not only a
business magnate but also a public figure. The spiritual guru has been in and
out of a lot of controversies. Recently, Baba Ramdev had to apologize to the
people of Assam for the harsh and insensitive comments made by a Patanjali
official. Satinath Barale, a yoga instructor and Patanjali employee made
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outrageous comments about Vaishnava saint Srimanta Shankardev at a yoga
camp. The aftermath of the event saw massive public outcry. The backlash
became so severe that Baba Ramdev himself had to issue an apology. Incidents
like this can tarnish the image of the brand.
• Current Pricing Strategy
Patanjali needs to revise its current pricing strategy or else the company will
fail to sustain itself. The current pricing strategy gives low-profit margins
which are necessary for Patanjali’s survival. The company will have to deal
with high labor, and raw materials cost if it doesn’t change its pricing strategy.
• Excessive Product Offerings
Patanjali has way too many products in its portfolio. Some of these are
profitable while others fail to generate any profit. Despite having such a
diverse product portfolio only 5 or 6 products like shampoo and toothpaste
generate high revenues. The company needs to discontinue low profit products
or solidify them so they can generate substantial profits.
• Lower Margins for Distributors
Patanjali’s core focus is on volume and not on margins. It offers lower
margins to distributors as opposed to other companies that deal in consumer
goods. For this reason, the company is a demand run company.
• Limited presence in International Market
Patanjali is a brand that has an International appeal thanks to its exotic
outlook. However, it has mainly restricted itself in the Indian market. Baba
Ramdev has an international audience, and he can provide an incentive in
regions where his strongest demographic base is located like Nepal.
Additionally, the company needs to target the younger Indian demographic
that is internet savvy and technologically advanced.
• Lack of experienced management graduates

Patanjali does not have a large pool of management graduates and thinks
tanks which can be a problem when they look for expansion throughout the
country or globally.
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Opportunities
Opportunities refer to the factors which the organization can use to its favor to
grow its market share, sales, brand recognition etc.
• Growth in Demand for Organic Products

The growth of consumer demand for organic products is increasing due to the
increasing awareness of organic and natural products.
• Patanjali’s positioning as manufacturing of natural products has attributed to
the growth and success of Patanjali Ayurveda Limited. The potential of
increased future demand for organic and natural products can benefit the
company.
• Expansion into the rural market

The Indian rural market is largely undeserved due to the low spending
capabilities of the low-income population of these regions. However,
Patanjali’s product’s pricing being 20-30% cheaper than other popular brands.
• The penetrative pricing policy of Patanjali combined with Baba Ramdev’s
popularity in the rural regions of India can help acceptance of Patanjali’s
products in rural India.
• Food Business
The brand can open quick restaurants like Haldiram and offer edibles that use
natural and organic ingredients. This can complement the company’s offerings
and help to generate bigger revenues. By offering food items, the company can
establish a stronger image in the Indian market.
• .Global Expansion
The demand for herbal, organic and natural products is also increasing in other
parts of the world, including the developed western countries. Patanjali’s
positioning as a natural and ayurvedic company can help. This offers Patanjali
an opportunity to expand into international markets and grow its brand.
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• Strategic Tie-ups
Patanjali has tied up with the Future Group to enter into modern retail chains.
The company has also expanded its e-commerce presence with its products
being available on Amazon, Big basket and other e-commerce platforms.
• Diversification
Patanjali can diversify into other natural and organic products such as Khadi,
clothing and apparel, natural cosmetics and other natural and organic products.
This will also the company to use its existing distribution channels and
strategic partnerships to distribute its new products.
Threats
Threats refer to factors that have the potential to harm an organization in the
future. Given the fact, threats give a brand a far-sighted view about the
problems that the brand is likely to face in the future, it is one of the most
important factors in the SWOT Analysis of Patanjali.
• Price war
A price war is good for consumers but it is detrimental for business. The
longer the price war, the more is the effect on the brand. Companies like
HUL, Colgate and others have been at the top for long. They have deep
pockets and they will naturally respond to Patanjali. Such a price war will have
drastic effect on Patanjali’s profitability, especially because the brand is
already selling at very low margins.
• Controversies
Patanjali has seen its fair share of controversies. Most recently was its
promotion of the “Putrajeevak Beej” that promised the birth of a male child to
any family that purchases it. The severe backlash resulted in a government
inquiry. Many politicians and activists recommended banning the sale of the
product. It has tarnished the image of the brand and has affected its revenue.
• Negative publicity
The company faced a major crisis when the Nepal Department of Drug
Administration issued a public notice to Patanjali stating that they had found
some of its medical products to be of “sub-standard quality.” The products had
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failed their microbial tests which were used to detect mold, bacteria, and other
toxins. This crisis resulted in negative word of mouth that damaged the
company’s reputation.
• Impact of a possible poor reap

Patanjali used natural herbs and agricultural products to manufacture its
products. Though Indian has a largely agriculture-based economy, most
agriculture is still dependent on rainfall to water their crops due to lack of
irrigation. One year of poor monsoon can lead to bad agricultural output, as a
result of this negatively impacting the supply of raw material for the company.
• Increase in Competition
India has some major players in the FMCG sector which include HUL,
Marico, Dabur, Parle Agro, ITC, Nestle, P&G, Britannia Industries Limited
and many more. Due to this, Patanjali Ayurveda Limited operates in a highly
competitive market space.
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PATANAJALI PESTLE ANALYSIS
PESTLE Analysis of Patanjali analyses the brand on its business tactics.

Patanjali PESTLE Analysis examines the various external factors like
political, economic, social, technological (PEST) which impacts its business
along with legal & environmental factors. The PESTLE Analysis highlights
the different extrinsic scenarios which impact the business of the brand.
PESTLE analysis is a framework which is imperative for companies such as
Patanjali, as it helps to understand market dynamics & improve its business
continuously. PESTLE analysis is also referred to as PESTEL analysis.
Let us start the Patanjali PESTLE Analysis:
▪ Political Factors:
The political factors in the Patanjali PESTLE Analysis can be explained as

follows:
Government in India never had a separate ministry for ayurvedic medicine and
research before 2014. In 2014 AYUSH - The Ministry of Ayurveda, Yoga &
Naturopathy, Unani, Siddha, Sowa Rigpa and Homoeopathy was created
which promoted research of alternate medicine. Government is also keen on
encouraging firms to develop alternate medicine than allopathy. Baba Ramdev
has his own political relations helping him stand strong in the business setup.
Make in India is the biggest boost for Patanjali since the whole concept of
manufacturing most of the needs internally is fulfilled by it.
▪ Economic Factors:
Below are the economic factors in the PESTLE Analysis of Patanjali:
Increasing Inflation rate in India has been the main reason the Indian
population is looking for cheaper alternate of products. Patanjali has captured
this need just perfectly. Increasing tax and interest rates effects the cost of
production of products. Patanjali is recognized as a affordable brand in the
lower middle class and middle class section and it would like to remain same.
Currency exchange rates effect less to Patanjali since it procures its raw
materials internally within India. It has nothing to do with imports from
foreign. GST introduced in India has been a great boon to Patanjali. The
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increased income capacity of the middle class in India has been an advantage
to Patanjali.
▪ Social Factors:
Following are the social factors impacting Patanjali PESTLE Analysis:
The population around the world, as a whole is becoming more health
conscious. Patanjali as a brand is ayurvedic and hence is side effect free. The
products are supposed to be healthier since they are mineral and herbal. One
more reason for people preferring Patanjali products is the rise in the life style
related health issues. The incorrect work life culture is major reason for body
pain, weakened bones etc. baba Ramdev also has a very strong and devoted
followers for his yoga trainings. He has held camps all across India and he is a
very well-known and established face in India. Time to time he has also
expressed his nationalist sentiments through media and that’s also a reason
people seek to believe his brand.
▪ Technological Factors:
The technological factors in the PESTLE Analysis of Patanjali are mentioned
below:
The biggest victory for Patanjali has been signing the Transfer of Technology
from DRDO which will be benefiting the people living in Leh since this
technology will be used to make products from the berries grown in Leh.
Government is completely supporting the technological advancements in
medicine and ayurvedic field specifically. Setting up of the Patanjali Yogpeeth
Trust at Haridwar is one such strong step towards the Research and
Development in alternate medicine industry.
▪ Legal Factors:
Following are the legal factors in the Patanjali PESTLE Analysis:
There are several laws that govern Patanjali and its functioning. The medicine
central control act 1970, the drug and cosmetic act 1940, the drugs and magic
remedies act 1954 being a few of them. There is also heavy penalty in case
Patanjali carries out unlawful branding of its products just to reach out to and
attract more audience.
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▪ Environmental Factors:
In the Patanjali PESTLE Analysis, the environmental elements affecting its
business are as below:
The biggest advantage that Patanjali has is that it produces environment

friendly products. They make products like detergents which are bio-
degradable. Their main aim is to provide the customers with natural form of
products without much artificial interference. They also have invested in bio-
research to improve their product range.
To conclude, the above Patanjali PESTLE Analysis highlights the various
elements which impact its business performance. This understanding helps to
evaluate the criticality of external business factors for any brand.
Browse analysis of more brands and companies similar to Patanjali PESTLE
Analysis. This section covers many brands and companies.
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4-P Analysis
Product Starting at 2007 with a humble range of products, Patanjali had
quickly diversified into a vast range of offerings: around 800 products13
including 250 medicinal products, 45 cosmetic products and 30 food
products.14 Broadly, the product category of Patanjali can be classified as
follows: Ayurveda Medicinal products, Organic natural juices, Groceries,
Oral/ dental care, Hair care, Skin care.
It is interesting to analyze how Patanjali has rolled out its product portfolio
and where it is heading towards in the near future. It started its products with
chawanprash, honey, organic natural juice and Ayurveda medicinal products,
which directly resonates with what Ayurveda stands for. But slowly it started
to copy the product portfolio of everything that a typical FMCG company
should have. With the launch of toothpaste, shampoo, beauty products,
noodles etc., it surely is expanding to become one of the FMCG power houses
with a differential offering of Ayurvedic range by the sheer number of
products in each of the categories.
Product Strategy & Development
Unlike most of the typical FMCG company practices, Patanjali has never been
into any formal market research to find out what product should they come up
with or what market they should enter. Rather they believe in the strategy of
making the products first and then taking it to the market. Many a times, there
has been instances where they entered into a new product category which
some other company has been doing it for years. Low price, purity and
innovation are the three main drivers of the product development strategy of
Patanjali. A good example of this can be of the Patanjali Amla Candy. Before
it was launched, there were numerous amla products in the market, hence the
market can be said to be existing. But this particular amla product in the form
of candy was unheard of before, which is a truly innovative move from the
company. As for the low price and purity aspects, this product qualifies them
too. The amla farmers were facing loss at a point of time since the market was
very small, though amla has many health benefits. Ramdev took a risk and
started promoting the health benefits of amla leveraging his huge following.
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This promotion was shortly followed by the product launch of amla juice and
amla candy, which was a hit product in the market. Another example where
Patanjali delivered in the lines of purity can be the Desi Ghee. There has been
always an inherent concern among the consumers about the availability of pure
ghee. This need of the customers did not require an extensive market research
to develop a product based on this line since Patanjali always worked form the
base of the pyramid and had a connect with the consumers and hence came up
with this product which became their best-selling product and accounted for a
37% of their sales in 2015 which amounted to Rs 442 crore of sales revenue.
Hence, it is clear that Patanjali is using Product Development strategy i.e.
developing new products (here in this case, making Ayurveda variants of
products) in an existing market. Their yoga sessions & camps is an existing
service in an existing market, but since it is vital for Patanjali, they will be
looking for Market Penetration by this. By targeting the youth, they want to
enter into a new market with their existing products & service. This strategy
can be a part of their Market Development plan. Finally, they are Diversifying
by bringing in new products in new market like cosmetics, health drinks etc.
Product Life Cycle
Patanjali has now a huge product portfolio under its brand. But scrutinizing
deeply, not all products were launched at the same time. Rather, they started
with few products and since then has been constantly innovating to come up
regularly with new products. Also, in comparison with other FMCGs, Patanjali
is a fairly young company dating back to 2007. Hence all of its products will
be either in introductory or in the growth phase and has still a long way to go
before it reaches maturity.
Introductory Stage
Ayurveda means life-knowledge, which was a system of medicine practiced in
India since ages. Ramdev was the one who materialized and commoditized
that knowledge and broke the barrier of using Ayurveda not only in medicine
but in consumable products too. With this vision, Patanjali was started in 2007.
Few products which are in the introductory stage are fertilizers and floor
cleaners. Clearly, the innovators and early adopters are those who are
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followers of Ramdev and middle age to old people who are health conscious
and believes in the Ayurveda.
Growth Stage
The meteoric rise of Patanjali started from 2012. From 2012 to 2015, it posted
CAGR of 64.7% of revenue growth and sales worth Rs. 2000 crore. Patanjali
is already past the gap between early adopter & early majority. Many of its
best-selling products like ghee and DantKanti have reached the growth stage.
Adoption & Diffusion
Adoption is when an individual makes the full use of an innovation as the best
option available. In the case of Patanjali, this adoption is done by the
innovators and early adopters who are the earnest followers of Ramdev,
follows his yoga sessions regularly, either in-person or over media, middle to
old age and believes in the purity & health benefits of Ayurveda products. On
the other hand, diffusion is when the innovation is communicated through
channels to mass members of the social system over time and is accepted. In
the case of Patanjali, this is done by a strong and positive word of mouth
communication from the early users to the early majority. Other media
channels also play a significant role in this process.
Innovation Strategy
A product or service can be innovative, but whether it will be successfully
adopted by the consumers depends on the degree of product change and the
degree of behavioral change that the innovation brings. From market visits and
interviews, it has been found out that Patanjali products are low in the degree
of product change and also low in the degree of behavioral change should the
consumers start using it. This makes the products of Patanjali an Easy Sell. For
example, let us take DantKanti, which is an Ayurveda tooth paste. By keeping
it in paste form like the existing Colgate and not powder form, it is ensuring
that there is minimal behavioral change. Also by adding a few key Ayurveda
ingredients, they are making a minimal change in the product. This innovation
strategy contributes to the easy adoption and hence easy sell of these products.
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Positive review of products
The products are quite effective and good results are noticed after consumption
or usage. At least to the common man’s perception, the products are of high
purity. The prices of all the products are significantly less that even some
people who does not believe in Ayurveda or is turned off by the poor
packaging, actually makes the purchase.
Negative review of products

The packaging is of extremely bad quality. Even the colors used and the
imagery as well as the packaging material is of low standard. (Though
according to in depth consumer interaction, this is perceived as a symbol of
honesty, purity and hard work unlike the MNCs who roll out any product with
an attractive packaging) The package size of most of the products is limited.
Hence customers do not have the option to purchase according to his/ her
usage requirements. Also the supply of the products is irregular at times which
often causes stock outs or unavailability of the products or size
Price
A significant amount sometimes as high as 20-30% of the sales goes to

marketing, packaging & advertisements in the case of typical MNC FMCG.
But in the case of Patanjali, these costs are low since they do not market or
advertise their products as their competitors nor they spend on fancy
packaging. Also, they either directly source the raw materials from the farmers
or grow them in their farms. This helps them significantly to keep the costs
low. Moreover, their manufacturing plants are nearby the sourcing locations.
Patanjali does not spend on extensive market research like other FMCG
companies. Also they don’t have neither hire high paying officials in their
company. As claimed by Ramdev, he does not even take anything home, while
most of the promotions are carried out by him. This is one of the main reasons
why Patanjali can offer products at such a low price. A table comparing the
prices of Patanjali with other products across different categories is shown in
appendix. The lesser price for each product in each category has created a Cost
Advantage for Patanjali. Middle class people find it good reason to switch to
these products. Even it urges the first time users to purchase it and give it a try.
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Place
The main manufacturing unit is in Haridwar, where all the production &
manufacturing takes place. From there on, the products are rolled out in two
formats: offline and online.
Offline
Patanjali Chikitsalaya, Arogya Kendra and Retail Stores
These are channels and outlets which are handled directly by Patanjali, from
distribution to procurement. The Patanjali Chikitsalaya offers free Ayurveda
doctor consultation over & above stocking the Patanjali products, irrespective
of whether the customer makes the final purchase or not. The Patanjali Arogya
Kendra is similar to Chikitsalaya, the only difference being that the presence
of a doctor is not compulsory here. The exclusive retail stores are minimal &
simplistic, stocking only Patanjali Ayurveda products and thus giving the
customers an easy & large offering to choose from.
Big Bazaar
As a part of tie up with Future group, Patanjali products are made available in
Big Bazaar retail outlets. The distribution is handled by Future group in this
case. But even in here, the Patanjali products generally have a separate shelf or
row of their own hence breaking away the clutter from the ‘me too’ products
of FMCG companies where there is almost no differentiation.
Yoga Camps
Ramdev actively organizes yoga camps across India round the calendar, which
lasts for at least 1 week every place where it is organized. These 1-week period
also provides an opportunity to promote extensively and sell these Patanjali
products.
Post Office
Patanjali products are made available in various post offices all over the
country. This is an extremely break through strategy, something which is less
explored and almost not done by the other FMCG companies. Since post office
is generally frequented by the pensioners and old people, it serves at a place
where they can make the purchase while standing on queues.
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Online
Patanjali Online Stores
Patanjali maintains 2 websites from where their products can be purchased

online. They even have an App in Google Play. Offering this online option
was a good move from the company side since it gives high convenience to the
customers, who are mostly shifting towards online shopping. Also, these
websites serve as a one stop place where a customer or potential buyer can
view the entire range of products that Patanjali has to offer, which sometimes
is not possible in an offline brick & mortar store. By this, he can choose &
select which product to buy & makes the purchase from the offline store in the
case he does not buy online.
Third party online platforms
Patanjali products are also available in various e-commerce platforms like

Amazon, Flipkart, Snapdeal and Big Basket to name a few. This is a good
strategy since it is a platform which is frequented by millennials who want
convenience and choice of purchase. It also acts as a promotional tool since
Patanjali products can come up in the deals or ads section of these sites, hence
attracting the attention of the customers who might end up buying.
Promotion
From the very beginning, the promotion strategy of Patanjali had two main
objectives. One was definitely to highlight the health benefits of using
Ayurveda products & to evoke the Swadeshi sentiment into the Indian
consumer’s mind. The other objective was to make aware of the customers
about the sinister way of the profit making by the FMCG giants which are
typically MNCs: that they not only fool the customers giving stale, adulterated
products but at the same time charging high price at the cost of exploiting our
farmers. All these promotions were carried out via various channels and
modes, some of which are as follows.
80
Direct marketing
Ramdev with his popular yoga guru image and organizing Yoga camps across
India round the calendar contributes to the direct marketing of the Patanjali
products where they are promoted and advertised along with the main events.
Word of Mouth
Most of the promotion is carried out indirectly by the followers of Ramdev and
the early adopters of Patanjali products who have found these products to be
good. While communicating with their family, friends, relatives, neighbors and
colleagues, they indirectly promote brand Patanjali by sharing their positive
experience with the products. Publicity through word of mouth form users is
something that tells that that the brand sells itself with minimal promotion.
Media
Aastha channel is the TV media where Patanjali is heavily promoted. It mainly
started as a means to spread health awareness & yoga sessions to the masses.
But with the advent of Patanjali, this channel along with the yoga sessions
were leveraged to promote Patanjali products & the health benefits of
consuming or using it. This move was aligned since they were promoting
health products in a health related lifestyle show. Apart from this, Patanjali ads
are sometimes observed in few other channels and print media. . Recently, a
new campaign on radio has been launched by Baba Ramdev (Patanjaliapnaiye,
deshkoaarthikaazadidilaiye)15, which hovers around the idea of providing
financial independence to the nation by the use of indigenous products.
Celebrity endorsement
Patanjali rarely did any celebrity endorsement since the popular face of
Ramdev was sufficient to carry on the promotion. His image as a yoga guru
totally aligned with the Ayurveda product offering of Patanjali. Celebrity
endorsement is something which was not previously in Patanjali’s promotion.
However lately, wrestler Sushil Kumar has been seen endorsing the Ghee
brand of Patanjali. But this is also to be kept in mind that this was not in a very
81
large scale promotion, nor the sports celebrity was a top shot. We are yet to see
a top shot celebrity endorsing brand Patanjali.
Branding
Ramdev is the face and the man behind the whole brand of Patanjali
Ayurveda. The story started even before the idea of Patanjali was
conceptualized. Ramdev started as a yoga guru offering a healthy life style
choice and quickly escalated to fame by TV and live yoga sessions, which had
a huge reach and created a big impact on the Indian people. One of his
erstwhile disciple & friend, Acharya Balakrishna who also happens to be an
Ayurveda expert, used this opportunity to launch a range of Ayurveda &
herbal products under brand Patanjali. Combining these products with the yoga
of Ramdev was a good move as they were complementary to each other and
helped each other as a sort of unwritten co-branding. Patanjali products started
to get promoted by Ramdev via the TV channel (Aastha) and also in his yoga
sessions. This association of Patanjali with the popular and mass accepted
yoga guru Ramdev has been a strong and favorable one. Hence salience or
awareness of the brand is high, significantly more in North India and parts of
Western India than other regions, the reason behind can be due to usage of
Hindi as its prime language of communication and promotion. The brand
recall is also quite high. The imagery that Patanjali carries is quite a positive
one, which is seen as a pure, good quality indigenous product and a healthier
alternative than other FMCG products typically found in market. In terms of
performance, by our market research and interviews, the customers are
satisfied with it. Most of the consumers feel that Patanjali is a brand that can
be trusted and hence advices each other to use these products. Since it is
lifestyle choice of choosing the healthier alternative among the existing
brands, there is a resonance among the consumers which results in strong
brand loyalty. It is observed that once a consumer starts using a particular
Patanjali product, he or she starts using other products too of the same brand
since all are aligned with Ayurveda. From its inception, Patanjali has been
following ‘Branded House’ strategy that is keeping everything under one
umbrella brand, unlike most of the other FMCG companies like HUL, P&G
etc. which uses ‘House of Brands’ strategy i.e. there is a standalone brand for
each product line offering. This gives Patanjali a significant advantage in
82
building a unified brand for itself, its current range of products and new
products which are going to be launched since it can leverage on the already
established brand of Patanjali.
Industry Analysis
The FMCG market in India is worth $49 billion USD as of January, 2016 and
is expected to grow to $103.7 billion USD by 2020.5 It is the India’s fourth
largest industry. The growing awareness, rising disposable income of the
masses and easier access are the key drivers of demand growth. There is also
an increased demand for premium products because of the growing youth
population. Besides the penetration into rural areas is increasing and thus
newer geographies are made into playgrounds for the myriad FMCG
companies. The FMCG industry has three main segments: Food and beverages
(18%), Health care (32%) and Household and personal care (50%). The
FMCG sector has witnessed a CAGR of 11.9% between 2007 and 2016. The
urban sector account for 65% of the revenues, while the semi-urban and rural
make up the rest 35%.6 The current trends in FMCG are product innovation
(e.g. Honitus: non-drowsy), product customization/mass customization,
premiumization, backward integration, outsourcing, increasing rural
penetration, outsourcing, expanding distribution networks, smaller sized
SKUs, increasing private label penetration and reducing carbon footprint.
After literature review, we performed the Porter’s Five Forces analysis to
determine the attractiveness of the industry, the details of which are as follows:
Bargaining power of Buyers (dealers, whole sellers)/ customers: HIGH
The switching cost is very low in case of FMCG products. FMCG market is
extremely competitive and hence every company fights to get the largest shelf
space at the most strategic locations to have greater visibility. On the contrary,
the products are low involvement products and are not highly differentiated.
Thus they ask for higher margins to stock the products. For the customer,
he/she has a wide array of choices. The Indian customer is price-sensitive as
well. So unless he/she sees value in the products or are given discounts it
83
would be difficult to persuade him/her to purchase. In such a setup, the dealer/
whole seller/ distributor/customer has higher bargaining power.
Bargaining power of Sellers: LOW
They have typically low bargaining power, Big FMCG companies have more
power in deciding the pricing structure when they source from local farmers or
fragmented commodity supplier groups. The FMCG companies are also
moving towards backward integration with farmers so as to capture a larger
part of the value chain. They provide the expertise to these farmers and in
return are able to source raw materials at cheaper prices. Finally the big
FMCG companies are also signing MOUs with local government to source
items at fair prices from the farmers.
Threat of substitutes: HIGH
There are a lot of brands and hence an equal number of offerings from each
brand. The product differentiation is not superb and thus commoditization is
not uncommon. Thus threat of substitutes is quite high since there is a huge
number of products in the same category. Besides the switching cost is nil. The
only concern is the availability of products in particular channels.
Competitive Rivalry: HIGH
The competitive rivalry is very high as the private label brands give heavy
discounts compared to the established brands. Thus the weak players are
ousted from the market. There are a huge number of players as the market is
highly fragmented. More MNCs are also coming to join the competition. The
established brands do a lot of branding to demand higher prices. So it is
difficult to gain market share in any category.
84
CHAPTER NO. 05
CONCLUSION& SUGGESTIONS
Conclusion:
Consumers are liking the Patanjali’s products due to its brand ambassador Baba
Ramdev. If Once, Baba Ramdev disassociates himself with the brand Patanjali,
the company’s share in the market will affect. As chemical products increase
day by day Ayurvedic product is boon to the modern society to become more fit
and fine.From the history of Patanjali today’s generation can learn so many
things that it is so useful, its dynamic nature gives so much lessons like how to
grow and expand and gives many business ideas.
Lets come to financial analysis, The Performance is good in terms of

Profitability. Generating good earnings on capital employed and has sufficient
resources to meet its tax and interest expenses but does not have sufficient
current assets to meet current liabilities and Uses of debt capital is low and its
decreasing everyyear.
Here, I conclude Patanjali is very good in terms of ayurvedic product but

because of the strong competitor ,he’s lacking somewhere, and the craze of
patanjali product diminishing day by day that’s why patanjali product fall down
in previous financial year i.e.2018-19.
85
Suggestions:
1) Current Asset should be increased to meet current liabilities.

2) Use of debt Capital should be increased.
3) Focus should be given to use the investment more efficiently to increase
shareholder’s Value.
4) Also, Innovative Strategies programs and policies should be devised in counter
Patanjali whose growth rate is increasing at a high rate in bakery industry.
5) Baba Ramdev Goodwill is not enough for the profitability of the Patanjali
Company there should be increase in promotions and some changes in price is
needed.
6) One strong comeback with some new product is demand of the market
nowadays.
7) New product must follow this 4A (Acceptability , Affordability , Accessibility
, Awareness).
86
BIBLIOGRAPHY
▪ https://www.mbaskool.com/Pestle-analysis/companies/17952-patanjali.html
▪ http://backoffice.phillipcapital.in/Backoffice/Researchfiles/Researchfilesmove/PC_-
Patanjali_Plant_Visit_Update_-_Jul_2016_20160804144849.pdf
▪ https://www.tofler.in/patanjali-ayurved-limited/company/U24237DL2006PLC144789
▪ https://tejas.iimb.ac.in/articles/Patanajali_Tejas_Mar17.pdf
▪ https://bstrategyhub.com/patanjali-swot-analysis-2019-swot-analysis-of-patanjali/
▪ Management Accounting :- S.Y.B.C.A.F. Semester lV
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CONTENT

COMPANY ANALYSIS: PATANJALI

Patanjali Ayurveda is maker of ayurvedic consumer products and is one of the

Products are sold through three types of medical centres:

The Indian System of Medicine(ISM) like Ayurveda, Homoeopathy, Siddha,

• Preservation of Intellectual Property Rights: The wealth of knowledge on

Some essentials of the scheme are:

• Providing infrastructure to food processing on predetermined basis

• Value addition to agricultural commodities to be ensured

• Establishing sustainable raw material supply chain

• Inducing of latest technology in the sector

• Pooling of resources for activities complementing food processing

• Quality assurance by process control, capacity building and optimization

Patanjali has prospects of getting subsidies which the Government is offering

• Firstly, encouraging Research and Development will inculcate and promote

• Medical tourism can be uplifted in collaboration with the hospitality industry

IMPACT ON GOVERNMENT SUPPORT

• Promoting products in the international market because of improperly

• Determination of degree of localization is not clear and hence requires a lot of

• With growth becoming prominent lack of IT knowledge, trust, capital access,

• ISM&H uses plant materials extensively for preparation of their drugs.

So the resource exploitation is inappropriate.

Amongst the more important authors called Patanjaliare:

Patanjali is one of the 18 siddhars in the Tamil siddha (Shaiva) tradition.

Patanjali continues to be honoured with invocations and shrines in some forms

The Mahabhashya of Patanjali on the Asthadhyayi of Panini is a major early

3] Ramdev baba established the PatanjaliAyurved Limited in 2006 along

Importance of Baba Ramdev in Patanjali

Patanjali makes P&G nervous, its advertisement expenses signaling a new

List of Top Patanjali Products with Price

Patanjali Product Name Price

PatanjaliDantKanti (200gm) Rs. 75

Patanjali Kesh Kanti Natural Hair Rs. 75

PatanjaliSaundarya Face Wash Rs. 60

Patanjali Ghee (500ml) Rs. 260

PatanjaliChyawanprash (1kg) Rs. 190

PatanjaliSaundarya Aloe Vera Rs. 80

Patanjali Coconut Hair Oil Rs. 150

Patanjali Aloe Vera Kanti Body Rs. 15

PatanjaliAmla Juice (1L) Rs. 110

Patanjali Honey (1kg) Rs. 275

This leads us to the conclusion that Patanjali’s enormous success is attributed

✓ Baba Ramdev’s popularity and his Swadeshi rhetoric.

1) Ayush must be targeted at the younger generation with the positioning of

2) The advertising message should be ‘Ayurveda for the modern lifestyle’.

5) HUL needs to utilise its strong distribution network by providing trade

6) Patanjali’s swadeshi stand could be diluted due to its recent associations

9) It should also emphasise its international quality standards to prove its

1. Social media campaigns and contests.

I. Corporate deals in the form of vouchers for performance awards, birthday

PAL is a Trend setter in the Indian FMCG sector. It has grown at a

A Ratio is one figure expressed in terms of another figure. It is mathematical

What is Ratio Analysis?

Ratio Analysis is the method or process by which the relationship f items or

Ratio Analysis is an attempt to derive quantitative measures or guides

Meaning and Definition of Ratio Analysis

Ratio analysis is a conceptual technique which dates back to the inception of

Formerly, Security qualified as a major requisite for banks and financial

The financial position of a unit is concretely and clearly encapsulated by the

2.Net Profit Margin Net Income/Net Sales100 1403/4512100 = 0.31

2.Net Profit Margin Net Income/Net Sales100 1569/8439100 = 0.19%