Eureka Forbes India

Company overview
Overview
Primary Business Activities: Eureka Forbes specializes in selling water purification, vacuum
cleaning solutions, and air purifiers.
Sector: The company operates in the consumer goods sector, specifically focusing on health
and environmental hygiene products.
Founding and History: It was founded in 1982 as a joint venture between the Tata Group and
Electrolux of Sweden. Originally part of Forbes & Company Ltd., it has grown to become a
leading name in health and hygiene products in India.
The main promoter of Eureka Forbes is Advent Private Equity. They acquired a significant
stake of 72.6% in Eureka Forbes in 2022, following its separation into a listed entity from
Forbes & Co. However in Feb’24, through their subsidiary (Lunolux Ltd.) Advent PE sold
10% of stake.

Product Segments:

● Water Purifiers: This segment includes a range of products under the brands
Aquaguard, Aquaguard Select, and Sure. It is one of the key revenue generators (>
for the company, offering technology-driven purification systems like RO and UV
purifiers- Aquaguard is their best selling product
● Water Solutions: Such as water softeners, iron remover, filters, and other accessories
● Vacuum Cleaners: This segment covers various indoor, outdoor, and car vacuum
cleaners, including robotic vacuum cleaners, which cater to residential and
commercial needs.
● Air Purifiers: Products under the Aeroguard and Forbes brands that address indoor
air quality concerns.

Target Market

Eureka Forbes targets the domestic consumer market with a focus on middle to
upper-middle-class households across India. Its extensive direct sales network and
omnichannel presence allow it to reach urban and increasingly rural consumers interested in
health, hygiene, and environmental quality.

Market Position
 ● EFL is market leader in the water purification systems and vacuum cleaners in India
with market share of 43.40% in Indian electric water purifiers segment and 60% in
vacuum cleaner segment.
● The flagship water purifier brand "Aquaguard" holds a 15% market share in the
broader water purifier market in India.

market share in water purifier and vaccuum cleaner segment

Distribution Channels

They have a presence in more than 1500 towns in India, over 40 international markets, at
home service for 10500+ pin codes, and and installed devices in 20 million customers.
They are pioneers in direct selling in India and are one of the largest direct-selling
companies in Asia.
Products are either imported, or manufactured in two facilities designed for specialized
production.
These are their distribution channels.

● Direct Sales: Its employs a 10000+ direct sales team known as "Eurochamps," who
engage customers through home visits, offering personalized product demonstrations
and detailed explanations. It operates from more than 120+ towns in India across
150+ response centres
● General Trade and Modern Retail: Includes physical retail channels, enhancing
visibility and accessibility of products.
● E-commerce: A significant part of their strategy, catering to the growing preference
for online shopping. It has its own website, and also sells products through
ecommerce marketplaces (Amazon, Flipkart, Croma, Reliance Digital, etc)
 ● Business-to-Business (B2B): Engages with corporate clients and institutional buyers.
(Present in commercial water purifiers)
● Canteen Stores (CSD): Supplies to armed forces' canteens, leveraging government
procurement channels.
● Omni-channel Presence: Integrates various sales channels to provide a seamless
customer experience .

SWOT Analysis:
Opportunities:
Expanding Market Demand: Increasing awareness about health and hygiene, especially
post-pandemic, presents a significant opportunity for growth in the water and air purifier
markets.
Technological Advancements: The rising interest in smart home devices offers Eureka
Forbes the opportunity to innovate and integrate advanced technologies into their product
lines.
Global Expansion: With a strong domestic base, there is substantial potential for Eureka
Forbes to expand its footprint internationally, particularly in regions with similar water quality
issues.
E-commerce Growth: The shift towards online shopping can be leveraged to enhance their
e-commerce platforms, reaching a wider and more tech-savvy customer base.

Strengths:
Brand Reputation: Eureka Forbes has established a strong brand reputation, especially for
its flagship Aquaguard water purifiers.
Extensive Distribution Network: With one of the largest direct sales networks in the country,
coupled with modern retail and e-commerce, the company enjoys exceptional market reach.
Innovative Product Portfolio: A diverse range of products equipped with advanced
technology in water purification, vacuum cleaning, and air purification helps the company
meet varied consumer needs.
Robust After-Sales Service: The company's comprehensive after-sales service, powered by
a vast network of service centers and trained technicians, ensures high customer
satisfaction and loyalty.
Threats:
Intense Competition: Eureka Forbes faces fierce competition in both water and air purifier
markets, especially from brands like Kent RO Systems in the RO segment, which could
impact market share.
Technological Disruptions: Rapid technological advancements could lead to obsolescence if
the company does not innovate at a comparable pace.
Regulatory Changes: Changes in environmental and health safety regulations could impact
product design and market strategies, requiring rapid adjustments.
Economic Downturns: Economic instability can affect consumer spending power, particularly
for non-essential goods like high-end purifiers.

Weaknesses:
Dependence on Direct Sales: The company’s heavy reliance on direct sales makes it
vulnerable to shifts in consumer buying behaviors towards online channels, which may not
be fully capitalized by the company.
Market Penetration Challenges: Despite a strong presence in urban areas, expanding
market reach in rural and semi-urban areas remains a challenge due to infrastructural and
logistical limitations.
Product Cost: High cost of advanced purifiers can be a barrier for widespread adoption,
especially in price-sensitive markets.

Management strategy:
Project Udaan:
Eureka Forbes' transformative initiative designed to foster sustained, profitable growth. It
encompasses strategic overhauls across organization structure, talent management, digital
integration, and customer engagement, aimed at enhancing operational efficiency, market
penetration, and innovation to adapt to evolving consumer needs and competitive
landscapes.
Marketing and Selling:
Omnichannel Strategy: Integrates direct sales, retail, and e-commerce to enhance product
accessibility and visibility.
Customer-Centric Marketing: Focuses on health and hygiene, employing targeted
promotional activities to strengthen brand recall.
Supply Chain Management:
Efficiency Optimization: Strategically places manufacturing and storage to minimize lead
times and reduce costs, with advanced technology enhancing inventory visibility and
management.
Servicing:
After-Sales Service: Prioritizes exceptional service to retain customers, offering regular
maintenance and quick issue resolution.
Network Expansion: Expands service capabilities through increased training for technicians
and more service centers, ensuring efficient customer support.
*Service App: The Aquaguard Genuine Service App can be used to book Service Plans, get
AMC discounts, schedule repair and replacement visits, track service status, rentals, etc
Competitive Advantage:
Strong Brand Recognition: Eureka Forbes is a well-established name with significant brand
equity, especially noted for its flagship brands such as Aquaguard. The company has also
successfully developed and marketed sub-brands like Sure and Select to cater to diverse
consumer preferences.

Wide Product Portfolio: The company offers a comprehensive range of products, including
various types of water purifiers like RO, UV, and RO+UV systems, along with products
offering benefits from copper, zinc, and other features. This diverse portfolio enables them to
meet a broad array of customer needs.

Extensive Distribution Network: Eureka Forbes has a robust distribution network that
includes access to over 20,000 retail outlets and services in more than 10,000 pin codes.
This expansive reach ensures that its products are accessible to a large customer base
across different market segments.

Strong Servicing Model: The company boasts a highly effective service model, which is
considered one of the strongest in the industry. This includes a significant reach of 8 million
households, highlighting its extensive service network and commitment to customer
satisfaction. The company’s comprehensive service network ensures high customer
satisfaction and loyalty, which is critical for repeat business and maintaining a competitive
edge.
Innovative Technology: Ongoing investment in research and development ensures that
Eureka Forbes stays at the forefront of technology in its products, offering advanced
solutions like UV and RO water purifiers.

Future Outlook:
Water Purifiers Business Growth: Focus on identifying and leveraging innovation in product
development. Expand the distribution network to access a broader customer base,
enhancing reach across both traditional and modern trade channels.

Product Portfolio Expansion: Explore and capitalize on the growing demand for cleaning
products and smart devices.
Enhance the product lineup to include advanced features that meet modern consumer
needs such as water purifiers with additional health benefits like copper and zinc, and
expanding into products with inbuilt heaters for drinking water. Introducing entry-level
priced products to drive consumer trials and expand market penetration, particularly aiming
to reach the bottom of the pyramid.

Increase revenues from services While the company has sold more than 8m water purifiers,
it generates limited service
income, considering many consumers are using filters from the unorganised sector. Eureka
has initiated steps to ensure it gets its due share of service revenues too since services
have a significantly higher margin.

Customer Experience Transformation: Implement strategies to deliver superior service

standards and use customer insights to provide customized solutions. Enhance
engagement and satisfaction across all customer interactions.

Digital and Ad-Spend Investment: Increasing investments in digital platforms and advertising
to build brand presence and attract a broader consumer base.

Adopt a Zero-based budgeting approach to streamline costs.

Improving margins to invest in additional resources for brand building and growth. Its
EBITDA margin has reached 10% in Q1FY24.

Digital-First Strategy: Integrate digital tools to improve customer control and visibility
throughout the sales process.
Ensure the sales force is equipped with digital capabilities to meet current market demands.

Future-Ready Organization Development: Invest in training and development to build agile

capabilities focused on customer needs. Prepare the sales team to adapt to emerging trends
and technologies.
Highlights and Insights
Launch of SKU at INR 6,499 to drive penetration
The company has recently introduced a new variant at INR 6,499 for water purifier. It
believes that there is strong potential to expand the penetration at the bottom-of-thepyramid.
The new product at an affordable price point is likely to result in adding new
customers looking for value-for-money solutions.

In April’24, it announced the appointment of Mr. Vikas Jayna as its CTO. Vikas’s
professional journey encompasses roles at companies such as Swiggy, OneAssist, Amazon,
and InfoEdge India Ltd