Cadbury parent Mondelez looks to make India manufacturing hub

Mumbai: Mondelez International, the $35-billion global snacking powerhouse that owns Cadbury Dairy Milk, will look at making India a manufacturing hub for the region across multiple product categories in the years to come.

Mondelez, which has invested $400 million in the country over the last four years, expects India to continue growing at double-digits, thus incrementally improving its contribution to global revenues over a period of time. The Indian subsidiary, which recently adopted the name Mondelez India Foods from Cadbury India, currently contributes 3% to global revenues and is among the top three markets for Mondelez in the Asia- Pacific.

"Depending on the economics, without a doubt, we have a great opportunity to source from India to nearby countries. The plant in Sri City (in Andhra Pradesh, where the company is investing $200 million or Rs 1,000 crore) will have the opportunity to supply to other locations," Irene Rosenfeld, chairman & CEO, Mondelez International, said at a select media gathering.

Rosenfeld, who is on a visit to India, inaugurated the new head office in Mumbai, interacted with shopkeepers and merchandisers during her tight-schedule that was packed in 40-odd hours. "India is a critical part of our business in which we have invested $400 million and that's why I am here. We have also increased our workforce here by about 40% in the last three years. Our Tang business grew by 65% in the first six months and we are getting good ROIs (return on investment),'" Rosenfeld (61) said.

A year after the erstwhile Kraft Foods had acquired Cadbury globally in 2010, the parent company had said it was issuing "a blank cheque"?in a manner of speaking?to India, to prepare a business plan and deliver results. A few years down the line, Rosenfeld said she is happy that those blank cheques are bearing fruit. This is despite the fact that the rate of growth has come off its peak. The growth of flagship brands Cadbury Dairy Milk which was around 40% plus then, too has slowed down this year in line with the general slowdown in the FMCG sector.

"A lot of those blank cheques are bearing fruit now and we are beginning to generate some terrific results. We clearly outgrew our capacity," said Rosenfeld. Mondelez, she said, would bring in more products and brands from its global portfolio of power brands, which include biscuits, over a period of time.

Mondelez International is a world leader in biscuits, chocolate, gum, candy, coffee and powdered beverages, with billion-dollar brands such as Oreo, LU and Nabisco biscuits; Cadbury, Cadbury Dairy Milk and Milka chocolate; Trident gum; Jacobs coffee and Tang powdered beverages.

Mondelez International is moving into a new globally consistent operating model based on a regional, category-led approach and focuses on the key categories of which include chocolates; gum, candy and powdered beverages; biscuits; and cheese and grocery. As part of this, Manu Anand, the India head, will move to a regional role as head of regional category team for chocolate, while Chandramouli Venkatesan (Mouli) will replace Anand as India MD.

Rosenfeld said the move will bring growth and build capabilities across countries.

"I am equally bullish about unlocking the potential from this model to accelerate our growth here in Asia Pacific," said Tim Cofer, executive VP and president, Asia Pacific, Eastern Europe, Middle East & Africa. Talent wise, too, India is being used as a sourcing hub for Mondelez International. With around 40 Indian leaders placed in critical leadership roles in Asia Pacific, Cofer said India plays a critical role.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.