New Delhi: Amla juice, honey, toothpaste and ghee are some of the popular offerings of yoga guru Baba Ramdev’s FMCG giant Patanjali. But that’s not all. The multi-million-dollar company has had a tech unit since 2019 that offers cloud services and other IT solutions.
Although it was registered in May last year, Patanjali’s IT venture — Bharuwa Solutions — remains a low-profile initiative that has brooked almost no media coverage.
With four patents in hand, Bharuwa Solutions is registered as a start-up under the ‘Startup Initiative’ of the Modi government.
Led by Patanjali Ayurved CEO Acharya Balkrishna, it is involved in designing solutions to digitally manage production planning, sales force, and loyalty programmes.
“Bharuwa Solutions is a venture with a focus on digital excellence through turnkey IT solutions, serving various enterprises in the field of agriculture and industry,” reads a brochure of the company, accessed by ThePrint.
Speaking to ThePrint, Balkrishna said the objective of Bharuwa Solutions was “to deliver reduced operational costs, easy-use cloud infrastructure, detailed analytics, and much more through our four patented software models which we have created in the last two years”.
The company offers cloud-based solutions to connect farmers, distributors, retailers and customers on a common platform that links the entire supply chain. Other offerings include custom-built billing software and point-of-sale (POS) solutions, enterprise resource planning (ERP) and digital sales assistant software.
“We have installed around 10,000 solutions, mainly across medium and small companies… involved in the supply chain of Patanjali Ayurved,” Balkrishna said. “Now, we are in talks with popular companies in FMCG (fast moving consumer goods), manufacturing and media sector as we begin hunting for bigger clients.”
What is Patanjali’s IT offering?
Patanjali, with its promise of unadulterated, swadeshi products, entered the FMCG sector as a disruptor in the 2000s, with Ramdev projecting a “turnover of around Rs 25,000 crore” for the company in 2019-20.
In 2020-21, he said this January, they expect a “turnover of Rs 35,000-Rs 40,000 crore” to “become the largest company in the FMCG sector in the coming years replacing market leader HUL (Hindustan Unilever Limited)”.
With its IT arm, the company has entered a market dominated by the likes of Tata Consultancy Services (TCS), Wipro, IBM, and HCL.
According to government data, the Indian IT industry comprises more than 17,000 firms, of which over 1,000 are considered “large” by scale of operations.
The IT business process management (BPM) industry, in which Bharuwa Solutions is involved, stood at $177 billion in 2019 and is expected to grow to $350 billion by 2025.
The website for Invest India, an initiative under the Ministry of Commerce and Industry, identifies the IT-BPM industry as the largest contributor to India’s exports.
Balkrishna made light of the competition they face in the sector as he explained that the term Bharuwa means “something that fills you with prosperity”.
“While we operate in the same field where other IT companies develop similar products, we have developed better and patented technology to plug the loopholes,” he added.
The company claims to have invested Rs 100 crore in the project, which is run by a team of around 100 employees.
“The lead engineers of the project are hired from top tech companies, including US-based Intellectus and German IT major SAP,” Balkrishna said.
Some analysts have termed Patanjali’s IT foray “ambitious”, but others sought to caution it against “aggressive expansion”.
“While companies like SAP and Microsoft are experts in supply chain management software, there are many areas where their software may not work — for instance, for a company like Patanjali,” said Sanchit Vir Gogia, chief analyst and CEO at Greyhound Research, a technology and innovation consultancy.
“In such circumstances, these companies build their own software and then try to monetise the platform by launching their own arm,” he added.
“Several companies in the past, including ICICI Bank and Ramco Cements, ended up creating their own tech-software firms. Some failed and some ruled the market,” Gogia said.
“There is a lot of room for such players in the market, but it all depends on their risk appetite. If Patanjali can invest millions of dollars for a minimum of 10 years without fearing failures, it can definitely carve its own space in the Indian IT industry.”
However, Arvind Singhal, chairman of management firm Technopak said Patanjali was “losing the plot”. “Instead of strengthening their core business, which is FMCG, they are wasting funds and focus on new areas,” he added
Singhal also cast doubt on Ramdev’s target to reach a turnover of Rs 40,000 crore by next financial year. “Considering the present turnover of the company, and accounting for the debt of their latest acquisition, Ruchi Soya, the turnover may not exceed Rs 10,000 crore-12,000 crore.”