IBEF: December 12, 2019
ITC, a diversified conglomerate is targeting up to 20 per cent of the Rs 7,400 crore (US$ 1.06 billion) frozen food market in India in next three years with the company increasing its offering in the category, as per a senior company official.
Recently, the firm has ventured into the frozen food segment under ITC Master Chef brand aiming both retail and food services players. The company also plan to expand its reach to over 30 cities in the retail segment and 100 cities in food services segment during the period.
"Currently, the frozen foods market in India is about Rs 7,400 crore (US$ 1.06 billion) and it is growing at about 17 per cent annually...Our intention is to explode the category. We are doubling our volumes. Our growth rate is about 6-7 times the industry growth," said ITC Chief Executive - Frozen Snacks, Fruits and Vegetables Mr Sachid Madan.
He added that the expansion of the product range will aid in company's progress in the category along with the reason that it is offering freshly frozen food with no added preservatives and can be cooked in multiple ways.
"We are in both (vegetarian and non-vegetarian) segments and we are beyond even chicken. In the categories in the market that we are present, we are aiming at 15-20 per cent share over the next three-odd years as we establish our distribution," Mr Madan said.
ITC will become the third major organised player in the frozen food segment after McCain, which mainly offers in the vegetarian segment and Venky's, which offers in non-vegetarian, he further added. Presently, ITC's market share ranges from 5-15 per cent in the segment depending on outlets and range.
"The market is very small compared to its potential. The idea is if it is growing at 17 per cent how can we accelerate it? When we are growing at 100 per cent, it will definitely grow," he said.
Around 50 different frozen food products were introduced under ITC Master Chef brand by the company consisting of a variety of Indian flavours such as 'Mumbai Vada Pops', 'Rajmah ki Galauti', 'Chicken Galauti', 'Falafel Kebab', 'Achari Beetroot Kebab', among others.
Mr Madan said, "These items are now available in 60 cities under the food service portfolio and 11 cities in retail outlets. In the next three years 60 will go to 100 and beyond and 11 will go to about 30." The focus is on expanding penetration of the category and dispel the myth about frozen foods not being healthy in consumers' mind, he said.
The company is first planning to expand in metros and urban areas for these products and will also made widely available to consumers and food services segment, including restaurants, cafes and pubs across India, including tier II and III cities, he added.
In order to produce these products, ITC has partnered with American firm OSI and is utilising the latter's manufacturing facilities in India. "We are manufacturing in Punjab, Andhra Pradesh and Maharashtra. We are kind of covering most of the places where the markets are," Mr Madan said.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.