Avimee Herbal is a cosmetic brand that produces hair and skin care products. They use Ayurveda in combination with modern ingredients.
RK Chaudhary is the founder of Avimee Herbal and was 85 years old when he founded it. He came to Shark Tank India with Siddhant Agarwal, Ambika Agarwal, Vinita Agarwal, and Vibhor Agarwal.
More About Avimee Herbal
RK Chaudhary, also known as Nanaji, is from Bhagalpur, Bihar, and completed his bachelor’s in commerce stream. RK Chaudhary has been fond of Ayurveda since childhood. He had done immense research in the field. Vinita (RK’s daughter) experienced hair loss after the first Covid wave.
She tried many products in the market, but nothing worked. To cure his daughter’s hair fall, Nanaji created a formula after extensive research. He created an Ayurvedic oil that fixed Vinita’s hair fall issue. After that, they started distributing this oil to their friends and family for free.
Soon, the oil became popular in India and even in other parts of the world. They started in 2021 with 3 products, and now they have 27 products.
Sidhant manages the operations. He is a CA by profession. Ambika is Sidhant’s wife and looks after the marketing. Vibhor is Sidhant’s brother and Vinita’s son. Ambika is a blogger on Instagram with 4 lakh followers.
She shared a reel about Nanaji’s journey of creating the oil, which 2.5 million people viewed. They haven’t spent anything on paid marketing. All their growth is organic.
Avimee Herbal Shark Tank Pitch and Updates
RK Chaudhary appeared on Shark Tank India Season 2 Episode 17 and demanded INR 2.8 crore for 0.5% equity at a valuation of 560 crores.
Their initial pitch was good. Vinita, Vibhor, and Ambika hold 33.3% equity each. Their sales were INR 6.5 crore from August 2021 to March 2022.
Their monthly sales by the time they appeared on Shark Tank India were – INR 1.25 crore in June, INR 1.75 crore in July, and INR 1.65 crore in August.
Their projected sales for FY 2022-23 were INR 20 crore, estimated to grow as their products got approved in Dubai. They were getting their first order of INR 1 crore from Dubai.
88% of sales come from their website, and the remaining 12% are from marketplaces. Their bestselling product is Keshpallav Hair Oil which brings 50% of their sales.
It is priced at INR 550. 100 INR is the GST cost, and the material cost is INR 135. Labor cost, packaging, shipment, and overheads cost INR 110. Hence, the EBITDA is INR 205.
Their second bestselling product is the hair tone spray which brings 30% of the total sales. Other products constitute the reaming 20% of the sales. Peyush questioned that if 80% of sales came from 2 products, why they were manufacturing 25.
Namita also asked why to go into skincare when you were already known for hair care. Their repeat rate is 32%.
Aman wanted to understand the valuation of 560 crores. Sidhant gave the example of Vedic, where the business has a 4.5 crore PAT for a revenue of 55 crores. The Valuation of that business is 400 crores. He said the valuation is usually 30 times the profit, and they’re projecting 9 crore PAT this year and 20 crores PAT next year.
Amit said the valuation is still too much considering the currently projected profit of INR 9 crores. Sidhant said the valuation is always forward-looking, and they’re looking at a profit of 20 crores next year. Peyush countered that forward-looking valuation is done for mature businesses.
With the investment they’re seeking on Shark Tank, they wish to set up a manufacturing factory that costs 5-6 crores.
All sharks were impressed by the Nanaji. However, Peyush was the first to get out of the deal because they were already making 8-9 crores. He felt he couldn’t help much. Namita was out of the deal because she felt they were focusing on too many products. Aman believed the valuation was too high for him.
Amit also felt the valuation was too high for him. However, he offered INR 1 crore for 2.5% equity at INR 40 crore valuation and INR 1.8 crore debt at 12% interest. Anupam offered INR 70 lakh for 2% equity at INR 35 crore valuation and INR 2.1 crore as debt at an interest rate of 15%.
Avimee countered their offer by opting out of debt and offering INR 2.8 crore for 1.5% equity at a valuation of INR 186.67 crore. Anupam couldn’t accept the counteroffer, and for that reason, he was out.
|Radha Krishna Chaudhary
|Cosmetic brand for hair and skin care
|Business is profitable
|Shark Tank Episode
|Season 2 – Episode 17
|INR 2.8 crore for 0.5% equity
Avimee Herbal did not go lower than their counteroffer. Hence, they could not bag a deal from any of the sharks.
Frequently Asked Questions About Avimee Herbal
After their appearance on Shark Tank India Season 2, people were trying to find more information about Avimee Herbal. Here are some of the frequently asked questions about them.
1. Who Is The Founder of Avimee Herbal?
Radha Krishna Chaudhary is the founder of Avimee Herbal. However, the equity is distributed evenly among Vinita, Vibhor, and Ambika.
2. Is Avimee Herbal profitable?
Avimee Herbal is profitable. Their EBITDA is 32% for their bestselling product, and their projected profit was INR 9 crore for 2022-23.
3. Why Sharks did not invest in Avimee Herbal?
Peyush felt he could not help much. Namita felt they were focusing on too many things and should stick to hair care. Aman believed the valuation was too high for him. Anupam was out as he could not accept the counteroffer. While Avimee Herbal rejected the offer of Amit.
4. What happened to Avimee Herbal after Shark Tank?
Avimee Herbal did not get any funding from the sharks. However, their turnover doubled after the Shark Tank India episode was aired. They also got some offers after Shark Tank India but chose not to go with them. In their words, they do not want money. They need someone to guide them.