GST has come with hiccups but its execution has been good: GSK Consumer CEO

GSK Consumer Healthcare chief executive Brian McNamara, who was in the country for the World Food India event, says the company is “yet to see through the full impact of the GST”. “There have been hiccups as one would expect in any major change. Consumption was hit a bit in the short term by demonetisation and GST but execution has been good,” he said. In an interview with Ratna Bhushan, he said consumption across world markets has been slow, and innovating quickly is critical. Edited excerpts:
How is GSK participating in the Indian government’s drive towards nutrition and health?
Affordability, access, availability — these will be key to our strategy to drive low-cost nutrition. We’re going to leverage our platforms and bring in different products over time. We’re working very hard to reach consumers and markets that are otherwise difficult to reach. We have access packs at Rs 5 — we are looking to drive those further. Our brands reach over 200 million consumers here, but there are a lot more consumers to reach. We’re in a good position to help drive the country’s agenda of nutrition. Globally, consumers are taking more control of their health and well-being and it’s no different in India.

Your global Q3 earnings show 2% growth this year versus 3- 4% in previous years. What should large companies such as yours do to spur consumption?
When consumption is soft and there are challenges, it’s all about going back to the consumer. It’s all about keeping the consumer at the centre and innovating. Making sure you have the right products to meet consumer needs. Innovating, and innovating swiftly. As long as you keep that focus, you can move in the market place and continue to win. The quicker we can react to consumer trends and get the product out there, the better it is. Working closely with commercial communities — that should be another priority.

How has the GST (Goods & Services Tax) implementation impacted your numbers in India?
We are yet to see through the full impact of the GST. There have been hiccups as one would expect with any major change. Consumption was hit a bit in the short term by demonetisation and GST, but execution has been good. The challenges have been fewer given the extent of change.

How long will GSK Consumer India continue to depend on Horlicks?
It’s a big business for us in India. We have other brands here, but the importance of Horlicks and Boost will always be there for the role they play in this market, in fighting malnutrition.

Our large over-the-counter products, such as Voltaren and Otrivin, are also key to our portfolio. And Sensodyne is a tremendous product. So, the overall focus is on consumer healthcare — and OTC is part of that. We are a healthcare company and we won’t dilute focus on any brand for the other — it’s more about how we can take consumer healthcare to as many consumers as we can. We will have a mix of both — locally relevant and global products. We want to be agile enough.

What is your consumption outlook for India?
For the mid to longer term, the outlook on India is strong. Demonetisation, GST, the World Bank ranking for ease of doing business — these are significant. A lot more companies are going to be interested in doing business here. If you look at India, it’s still one of the faster-growing markets globally. For us, it’s a tremendous market; our second largest market globally after the US. We've invested a couple of million dollars in the past few years. We will continue to do so. I can’t give you numbers because we are in a silent period.