A day after Baba Ramdev-led Patanjali Ayurved partnered with e-commerce giants to boost its online sales, it has been reported that the ayurvedic company will soon turn into a not for profit organisation. According to a report in Mint, Patanjali will not be listed on stock exchanges. "We will list Patanjali in people's hearts. We are transforming Patanjali into a non-profit organization," Ramdev told the business daily.
Not for profit organisations do not earn profits for the owners as all the revenue of such firms is used to pursue the company's objectives such as public service and charity. Non-profit organisation and charitable trusts are also eligible for tax exemptions under the Income Tax Act.
The report also said that Ramdev has set up a charitable organization, Patanjali Seva Trust, which will be the sole holding entity for all companies that are part of Patanjali Group. Baba Ramdev along with Acharya Balkrishna, a scholar of Ayurveda, had established Patanjali in 2006. Currently, Balkrishna owns over 98 per cent of Patanjali Group.
On Tuesday, Patanjali signed agreements with eight leading e-tailers - Amazon, Flipkart, Paytm Mall, 1MG, Bigbasket, Grofers, Shopclues and Snapdeal- to expand its online presence. Some of Patanjali's products were already available on its own portal, patanjaliayurved.net, along with several online platforms through various other sellers but the new tie-ups will allow the Haridwar-based firm to not only systematically place its range of products but also extend reach significantly, including globally.
Patanjali Ayurved decided to tweak its sales strategy last year when it departed from the branded franchise it relied on since inception to make its fledgling presence felt in the market and adopted the channel distribution route usually preferred by FMCG companies. The move was seen to be crucial to meet Ramdev's ambitious target of annual sales of Rs 1 lakh crore by 2020. Patanjali is currently ranked number seven in the FMCG space - and meet its turnover target of Rs 20,000 crore for this fiscal year, a twofold growth year-on-year.