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D a i r y P ro d u c t s M a r ke t i n I n d i a By Ty p e, C o m p e t i t i o n Fo re c a s t a n d O p p o r t u n i t i e s , 2011 – 2021 Market Intelligence . Consulting
Ta b l e o f C o n t e n t s S. No.
Contents
Page No.
1.
Research Methodology
2.
Analyst View
10
3.
Product Overview
12
4.
Global Dairy Products Market Overview
14
5.
India Dairy Products Market Outlook
16
5.1.
Market Size & Forecast
5.1.1. 5.2.
5.3. 6.
6.2. 7.
By Value
5.2.1.
By Type (Drinking Milk, Ghee, Butter, Ice Cream, Milk Powder, Cheese, Yogurts, Probiotic Drinks & Others)
20
5.2.2.
By Region
22
5.2.3.
By Company
27
5.2.4.
By Organized Vs Unorganized
31
Market Attractiveness Index
32 34
Market Size & Forecast 6.1.1.
By Value
35
6.1.2
By Volume
36
Pricing Analysis
India Ghee Market Outlook 7.1.
19
Market Share & Forecast
India Drinking Milk Market Outlook 6.1.
8
39 41
Market Size & Forecast 7.1.1.
By Value
42
7.1.2
By Volume
43
2 © TechSci Research
Ta b l e o f C o n t e n t s S. No.
Contents 7.2.
8.
Pricing Analysis
44
India Butter Market Outlook
46
8.1.
8.2. 9.
9.2.
8.1.1.
By Value
47
8.2.2.
By Volume
48
Pricing Analysis
10.2.
11.2.
51
9.1.1.
By Value
52
9.1.2.
By Volume
53
Pricing Analysis
54 56
Market Size & Forecast 10.1.1.
By Value
57
10.1.2.
By Volume
58
Pricing Analysis
India Cheese Market Outlook 11.1.
49
Market Size & Forecast
India Milk Powder Market Outlook 10.1.
11.
Market Size & Forecast
India Ice Cream Market Outlook 9.1.
10.
Page No.
59 61
Market Size & Forecast 11.1.1.
By Value
62
11.1.2.
By Volume
63
Pricing Analysis
64
3 © TechSci Research
Ta b l e o f C o n t e n t s S. No. 12.
Contents India Yogurts Market Outlook 12.1.
12.2. 13.
13.2. 14.
66
Market Size & Forecast 12.1.1.
By Value
67
12.1.2.
By Volume
68
Pricing Analysis
India Probiotic Drinks Market Outlook 13.1.
Page No.
69 71
Market Size & Forecast 13.1.1.
By Value
72
13.1.2.
By Volume
73
Pricing Analysis
India Other Dairy Products Market Outlook 14.1.
Market Size & Forecast
14.1.1.
By Value
74 76
77
15.
Import-Export Analysis
78
16.
Supply Chain Analysis
83
17.
Market Dynamics
86
17.1.
Drivers
88
17.2.
Challenges
91
18.
Trends & Developments
94
18.1.
Implementation of Favorable Government Initiatives
96
18.2.
Adoption of Automation by Private Players
97
18.3.
Rising Demand for Yogurt and Western Dairy Products
98
4 © TechSci Research
Ta b l e o f C o n t e n t s S. No.
Contents 18.4.
Steady Rise in Demand for Organic Milk
18.5.
Increasing Demand For Packaged Products
Page No. 99 100
19.
Policy & Regulatory Landscape
101
20.
India Economic Profile
105
21.
Competitive Landscape
108
21.1.
Gujarat Cooperative Milk Marketing Federation Ltd
109
21.2.
National Dairy Development Board
110
21.3.
Karnataka Cooperative Milk Producers Federation Ltd
111
21.4.
Tamil Nadu Co-operative Milk Producers' Federation Limited
112
21.5.
Andhra Pradesh Dairy Development Cooperative Federation Ltd
113
21.6.
Heritage Foods Ltd
114
21.7.
Hatsun Agro Products Ltd
116
21.8.
Kwality Limited
118
21.9.
Paras Dairy
120
21.10.
Parag Milk Foods Limited
121
22.
Strategic Recommendations
122
23.
& Disclaimer
127
5 © TechSci Research
List of Figures Figure No.
Title
Page No.
Figure 1:
Top 5 Milk Producing Countries, By Volume, 2014 (Million Tons)
15
Figure 2:
India Milk Consumption Share, By Cattle Type, By Volume, 2014
17
Figure 3:
India Dairy Products Market Size, By Value, 2011-2021F (USD Billion)
19
Figure 4:
India Dairy Products Market Share, By Type, By Value, 2011 – 2021F
20
Figure 5:
India Dairy Products Market Share, By Region, By Value, 2015 & 2021F
22
Figure 6:
India Dairy Products Market Share, By Region, By Value, 2011 – 2021F
24
Figure 7:
India Dairy Products Market Share, By Company, By Value, 2011 – 2021F
27
Figure 8:
India Dairy Products Market Share, By Organized vs Unorganized, By Value, 2015
31
Figure 9:
India Dairy Products Market Share, By Organized vs Unorganized, By Value, 2021F
31
Figure 10:
India Dairy Products Market Attractiveness Index, By Type, By Value, 2015-2021F
33
Figure 11:
India Drinking Milk Market Size, By Value, 2011-2021F (USD Billion)
35
Figure 12:
India Drinking Milk Market Size, By Volume, 2011-2021F (Billion Litres)
36
Figure 13:
India Drinking Milk Average Selling Price, 2011-2021F (USD per Litre)
39
Figure 14:
India Ghee Market Size, By Value, 2011-2021F (USD Billion)
42
Figure 15:
India Ghee Market Size, By Volume, 2011-2021F (Billion Kilograms)
43
Figure 16:
India Ghee Average Selling Price, 2011-2021F (USD per Kilogram)
44
Figure 17:
India Butter Market Size, By Value, 2011-2021F (USD Billion)
47
Figure 18:
India Butter Market Size, By Volume, 2011-2021F (Billion Kilograms)
48
Figure 19:
India Butter Average Selling Price, 2011-2021F (USD per Kilogram)
49
Figure 20:
India Ice Cream Market Size, By Value, 2011-2021F (USD Billion)
52
Figure 21:
India Ice Cream Market Size, By Volume, 2011-2021F (Billion Litres)
53
Figure 22:
India Ice Cream Average Selling Price, 2011-2021F (USD per Liter)
54
Figure 23:
India Milk Powder Market Size, By Value, 2011-2021F (USD Billion)
57
Figure 24:
India Milk Powder Market Size, By Volume, 2011-2021F (Billion Kilograms)
58
Figure 25:
India Milk Powder Average Selling Price, 2011-2021F (USD per Kilogram)
59
Figure 26:
India Cheese Market Size, By Value, 2011-2021F (USD Billion)
62
Figure 27:
India Cheese Market Size, By Volume, 2011-2021F (Billion Kilograms)
63
6 © TechSci Research
List of Figures Figure No.
Title
Page No.
Figure 28:
India Cheese Average Selling Price, 2011-2021F (USD per Kilogram)
64
Figure 29:
India Yogurts Market Size, By Value, 2011-2021F (USD Billion)
67
Figure 30:
India Yogurts Market Size, By Volume, 2011-2021F (Billion Liters)
68
Figure 31:
India Yogurt Average Selling Price, 2011-2021F (USD per Liter)
69
Figure 32:
India Probiotic Drinks Market Size, By Value, 2011-2021F (USD Billion)
72
Figure 33:
India Probiotic Drinks Market Size, By Volume, 2011-2021F (Billion Kilogram)
73
Figure 34:
India Probiotic Drinks Average Selling Price, 2011-2021F (USD per Liter)
74
Figure 35:
India Other Dairy Products Market Size, By Value, 2011-2021F (USD Billion)
77
Figure 36:
India Dairy Product Exports to Top 5 Countries, By Value, 2013-2014 & 2014-2015 (USD Million)
80
Figure 37:
India Disposable Personal Income, 2011 – 2015 (USD Billion)
91
Figure 38:
India Year on Year Growth Comparasion for Value Added Dairy Products and Non Value Added Dairy Products 2012-2021F
92
Figure 39:
India Demand & Availability of Feed and Fodder, 2014 (Million Tonnes)
94
Figure 40:
India Year on Year Growth Comparasion for Indigenous Dairy Products and Western Dairy Products 2012-2021F
100
L i s t o f Ta b l e s Table No.
Title
Page No.
Table 1:
India Dairy Products Market Share, By State, By Value, 2011 & 2015
23
Table 2:
India State wise Milk Production, 2010-11-2014-15 (Thousand Tonnes)
37
Table 3:
India Dairy Product Imports, By Value (USD Million), By Volume (Thousand Tonnes), 2011-2015
81
Table 4:
India Dairy Product Exports, By Value (USD Million), By Volume (Thousand Tonnes), 2011-2015
82
Table 5:
India Dairy Products Import Duty Structure, 2015
106
7 © TechSci Research
Research Methodology Market Intelligence . Consulting
Research Methodology Baseline Methodology Our dedicated team of industry experts has comprehensively monitored and analyzed various aspects of India dairy products market. The team has analyzed various industry segments and speculated a positive future of the industry. Taking into consideration growth in disposable income, rising demand for value added dairy products (VADP), increasing working population, especially women, changing food consumption pattern, retail and supermarkets/hypermarkets, etc., our team of analysts has provided an in-depth analysis of the industry’s performance in the future. This would enable our clients in planning their investment decisions and explore growth opportunities in the India dairy products market. For our study, we have gathered information through primary research surveys with manufacturers and suppliers of dairy products in India, followed by an exhaustive secondary research from credible paid databases.
Our team of experts has then prudently evaluated all collected information and organized the same in chronological order to depict a meaningful and clear picture of the dairy products market in India. In addition, while compiling the data, we have also validated all the collected information from multiple sources and data warehouses in order to present the most accurate and precise information of the concerned industry. We have also identified and analyzed all emerging trends, including important drivers and challenges that the industry is confronting. We have also presented various forecasts for the industry based on our in-depth analysis of market dynamics, prevalent trends, major developments and growth opportunities. Companies Interviewed
NDDB, Amul, Heritage Foods, GopalJee Dairy, Paras Dairy, Gujarat Cooperative Milk Marketing Federation Limited, Schreiber Dynamix Dairy
Secondary Sources : Annual Reports, Press Releases, Government Statistics, etc.
9 © TechSci Research
A n a lys t Vi ew
Analyst View India Dairy Products Market to Grow at a CAGR of over 7% during 2016-2021
India dairy products market is projected to reach USD133 billion by 2021 from USD89.9 billion in 2015, ing a CAGR of over 7% during 2016-2021. Increasing health consciousness among consumers, rising disposable income levels, etc., are driving growth in India dairy products market. Demand for dairy products in India is being driven by increasing malnutrition and other calcium related deficiencies in rural areas, and introduction of value added dairy products and changing consumption patterns in urban areas. Drinking Milk to Dominate India Dairy Products Market
Drinking milk dominated India dairy products market in 2015 and the trend is anticipated to continue through 2021. Drinking milk market in India is projected to grow at a CAGR of over 9%, in value , during 2016-2021, due to growing domestic and international demand. Drinking milk segment garnered a revenue share of over 36% in India dairy products market in 2015 and this is projected to reach 40.55% by 2021. Rising Consumption of Value Added Dairy Products Consumption pattern demonstrates growth in demand of value added dairy products such as ghee, cheese, butter, etc. This changing consumption patterns of consumers in India can be attributed to changing food habits and rising disposable income levels. Rising Share of Organized Sector in India Dairy Products Market Indian dairy products market is expected to witness a shift from unorganized to organized sector. The share of organized market, which stood at 30% in Indian dairy products market in 2015, and is projected to reach 42% by 2021. Rising share of organized sector in India dairy products market can be attributed to rising demand for high quality packaged products, especially in urban areas. However, in rural areas, acceptance of packaged dairy products is slowly gaining momentum.
11 © TechSci Research
Product Overview Leading Dairy Products in India
•
Drinking Milk
Dairy products can be defined as products produced from milk, sourced from cows, buffaloes, goats,
sheep,
Milk Powder
yaks, horses,
camels and other mammals.
producer of milk in the world, suring European Union.
•
Cheese
In 2014, India was declared as the largest
Increasing production of dairy products, rising purchasing power of consumers, changing
preferences
and
growing
Dairy Products
•
Ice Cream
Butter
Probiotic Drinks
demand for value added dairy products are anticipated to fuel growth in India
Ghee
dairy products market. Yogurts
12 © TechSci Research
Product Overview
The dairy products are majorly categorized
Raw Milk
into drinking milk and value added dairy products (VADP). Traditional
Drinking Milk
VADP
includes
ghee,
khoya,
mishti dahi, matta, etc., and non-traditional products
or
western
products
such
as
butter, cream, cheese, etc. In India, demand for traditional VADP is
Value Added Products
higher than non-traditional VADP. This is evident from the fact that the utilization of
milk
Non Traditional VADP
for
production
of
western
dairy
products is only 5% of the total raw milk
Traditional VADP
produced.
13 © TechSci Research
G l o b a l D a i r y P ro d u c t s M a r ke t O ve r v i ew
Global Dairy Products Market Overview Growing inclination towards healthy living, improving standards of living in developing countries and increasing exports from Asia and Africa to the European Union is projected to drive growth in global dairy products market in the coming years. Since 1982, global milk production increased by more than 50% and as of 2014, India is the leading producer of milk in the world. Rising awareness about the benefits of consuming pasteurized milk over raw milk and changing consumer buying behavior are driving growth in the global dairy products market. Moreover, growing popularity of low fat dairy products is generating demand for these products from various population segments, and opening new avenues for companies in this segment. Changing consumers buying behavior has accelerated growth of value added dairy products such as cheese, butter, butter milk, low fat yogurt, flavored milk, probiotic drinks, etc. These products have become a part of regular consumption due to convenience and health benefits. As of 2015, India still is the world’s largest milk producer and ed for a 16% share in the global production, followed by the US, China, Pakistan and Brazil. In the last few years, prices of dairy products across the global market have been declining due to substantial increase in dairy production. Figure 1: Top 5 Milk Producing Countries, By Volume, 2014 (Million Tons) 150.39
146.33 93.64 49.28
35.02
34.07
15 European Union
India
United States
China
Pakistan
Russia Source: TechSci Research
© TechSci Research
I n d i a D a i r y P ro d u c t s M a r ke t O u t l o o k
India Milk Consumption Share, By Cattle Type Consumption of milk in India is dominated by buffalo milk, mainly due to its high fat content. The cholesterol content of buffalo milk is 0.65 mg/g as compared to 3.14 mg/g for cow milk. Additionally, the Protein Efficiency Ratio (PER) of buffalo milk proteins is 2.74 as compared to 2.49 of cow milk. Buffalo milk has about 11.42% higher protein than cow milk. Commercially, it is more feasible to use buffalo milk for manufacturing fat-based and non fat-based milk products such as butter, ghee, milk powders, etc., due to its lower water content and high fat content.
Most of the farms in India depend on buffalo milk for dairy products production and India s for about twothirds of the world's buffalo milk production. Cow milk ed for a share of 45% in total milk consumption in India in 2014. However, goat milk ed for a share of 4% in the total milk consumption in India, in 2014.
Figure 2: India Milk Consumption Share, By Cattle Type, By Volume, 2014
Goat Milk 3.77 Buffalo Milk 51.17
Cow Milk 45.06
17 Source: DAHD © TechSci Research
India Dairy Products Market Outlook
With approximately 75 million dairy farms around the country, India is the largest producer of milk and produced around 52.39 billion liters of milk in 2015.
The milk processed by the organized sector in around 1,400 dairy processing plants, with an installed capacity of almost 135 million liters per day.
The dairy industry employees around 90 million people and approximately 75 million of these are women.
Growing awareness regrading milk quality and changing lifestyles is propelling growth in the demand for packaged products. Rapidly changing lifestyles influenced younger generations to adapt to newer products such as yogurts, probiotic drinks, etc.
An average Indian household spends USD10 to USD25 in a month on dairy products.
18 © TechSci Research
India Dairy Products Market Size Figure 3: India Dairy Products Market Size, By Value, 2011-2021F (USD Billion) CAGR 2016E-2021F By Value: 7.01%
CAGR 2011-2015 By Value: 4.89%
74.20
77.40
80.90
84.90
89.80
94.98
2011
2012
2013
2014
2015
2016E
100.88
2017F
107.46
2018F
114.89
2019F
123.40
2020F
133.25
2021F
Source: TechSci Research
Dairy products market in India grew at a CAGR of 4.89%, in value , during 2011-2015 and was valued at USD89.80 billion in 2015. This is forecast to reach USD133.25 billion by 2021, exhibiting a CAGR of over 7%, in value , during 2016-2021. Dairy products market in India is witnessing a tremendous change, due to increasing emphasis on nutritional value of dairy products. Introduction of value added dairy products, changing consumption patterns, growing penetration of international players, etc. are fueling growth of dairy products market in India. Unorganized dairy products sector garnered a majority share in India dairy products market in 2015, and this is projected to decline in the next 5 years. Value added dairy products, changing consumer preference for law fat dairy
19
products, increasing per capita spending, etc., are fueling growth of the organized sector in India dairy products market. © TechSci Research
India Dairy Products Market Share, By Type Figure 4: India Dairy Products Market Share, By Type, By Value, 2011-2021F
36.22%
36.34%
36.52%
36.69%
36.58%
36.69%
36.90%
37.34%
38.03%
26.66%
26.81%
26.65%
26.46%
26.90%
27.06%
27.10%
26.85%
26.26%
28.01%
27.58%
27.34%
27.08%
26.45%
6.49%
6.49%
6.83%
6.70%
6.60%
6.53%
25.84%
25.27%
25.23%
24.64%
24.06%
6.96%
7.09%
7.23%
7.38%
2.15%
2.36%
1.25%
1.23%
1.23%
1.29%
1.37%
1.46%
1.56%
1.68%
1.81%
1.96%
1.05%
1.10%
1.16%
1.22%
1.25%
1.26%
1.27%
1.26%
40.55%
39.07%
23.75% 22.86%
23.47%
7.54%
2.62%
1.19%
0.77% 0.60%
0.24% 0.09%
0.13%
0.10%
0.03% 2011 Drinking Milk
0.29%
0.27%
0.25%
0.03% 2012 Ghee
0.03% 2013 Others
0.20%
0.16% 0.03% 2014
0.35%
0.32%
0.04% 2015 Butter
Others: Curd, Paneer, Cream Flavored milk, Soy milk, Dairy whiteners
0.25%
0.39%
0.49%
0.66% 0.57%
0.47%
0.04%
0.30% 0.04%
2016
2017
Ice Cream
0.44%
Milk Powder
0.38%
0.05%
0.05%
0.06%
0.06%
2018
2019
2020
2021
Cheese
Yogurts
20
Probiotic Drinks Source: TechSci Research
© TechSci Research
India Dairy Products Market Share, By Type
Drinking milk ed for a revenue share of 36.58% in India dairy products market in 2015 and this is projected to reach 40.55% by 2021. Ghee ed for a revenue share of 26.45% in India dairy products market in 2015. With changing preference of consumers, the market share of value added dairy products such as butter, cheese, etc., is anticipated to grow during the forecast period.
Butter is projected to for a revenue share of over 7% in India dairy products market by 2021. Introduction of low fat products, rising health awareness, etc., are anticipated to fuel growth in India value added dairy products market.
Rising health concerns and growing penetration of international players is anticipated to fuel demand for probiotic drinks. Increasing disposable income levels, changing consumption patterns, entry of international brands, etc., are driving demand for yogurts and ice creams in India.
21 © TechSci Research
India Dairy Products Market Share, By Region Figure 5: India Dairy Products Market Share, By Region, By Value, 2015 & 2021F
North
East
2015: 34.96% 2021F: 32.48%
2015: 11.92% 2021F: 12.29%
West
South
2015: 31.77% 2021F: 32.11%
2015: 21.35% 2021F: 23.12%
Source: TechSci Research
22 © TechSci Research
India Dairy Products Market Share, By Region Table 1: India Dairy Products Market Share, By State, By Value, 2011 & 2015 State
2011
2012
2013
2014
2015
Uttar Pradesh
17.26%
17.64%
17.62%
17.57%
17.73%
Rajasthan
10.86%
10.56%
10.53%
10.58%
11.92%
Andhra Pradesh
9.19%
9.45%
9.64%
9.45%
6.80%
Gujarat
7.65%
7.68%
7.79%
8.07%
8.23%
Punjab
7.73%
7.47%
7.34%
7.27%
7.28%
Madhya Pradesh
6.17%
6.37%
6.67%
6.97%
7.59%
Maharashtra
6.60%
6.62%
6.60%
6.60%
6.71%
Haryana
5.14%
5.21%
5.32%
5.41%
5.56%
Bihar
5.35%
5.19%
5.17%
5.23%
5.47%
Tamil Nadu
5.61%
5.45%
5.29%
5.12%
5.02%
Karnataka
4.20%
4.26%
4.32%
4.36%
4.31%
West Bengal
3.67%
3.65%
3.67%
3.56%
3.49%
Kerala
2.17%
2.12%
2.11%
1.93%
1.91%
Odisha
1.37%
1.35%
1.30%
1.35%
1.34%
Jharkhand
1.28%
1.36%
1.27%
1.23%
1.22%
Others
5.75%
5.62%
5.38%
5.30%
5.43%
23
Source: TechSci Research © TechSci Research
India Dairy Products Market Share, By Region Figure 6: India Dairy Products Market Share, By Region, By Value, 2011 & 2021F
35.22%
35.36%
35.01%
34.98%
34.96%
34.53%
34.11%
33.70%
33.29%
32.88%
32.48%
31.32%
31.68%
31.72%
31.77%
31.85%
31.92%
31.98%
32.03%
32.08%
32.11%
21.31%
21.35%
21.92%
22.22%
22.51%
22.82%
21.20%
21.36%
21.64%
23.12%
21.38%
12.21%
12.01%
11.94%
11.93%
11.92%
11.98%
12.04%
12.10%
12.17%
12.23%
12.29%
2011
2012
2013
2014
2015E
2016F
2017F
2018F
2019F
2020F
2021F
31.37%
North
South
East
24
West Source: TechSci Research
© TechSci Research
India Dairy Products Market Share, By Region North Region North India ed for a market share of 35% in India dairy products market in 2015. Increasing per capita expenditure and rising youth population base, implementation of various government initiatives, improvements in infrastructure, increasing middle class population in Tier II & III cities, etc., fueled consumption of dairy products in the region, during 2011-2015. North India is the largest producer of milk in India. Around 23 MMT of milk was produced in Uttar Pradesh, which is ed for a share of 17% in the country’s total milk production. Bhadawari, an improved buffalo breed, in Agra and Etawah districts of Uttar Pradesh, are known for their high average milk yield of almost 1,300 kg per lactation period, with rich content of 6-13% milk fat in its milk. Farmers from Punjab are using Punjab Holstein, high-performance cross-bred cows that yield up to 10,000 liters of milk in a 10-month lactation period. In 2015, the state had over 25 lakh cross-bred cows, the highest in the country. West Region West region ed for a revenue share of over 31% in India dairy products market in 2015 and this is projected to increase to 32.05% by 2021. Highest number of dairy co-operatives, increasing household income levels coupled with large number of households, are driving growth of the dairy products market in this region. Increasing urbanization, changing consumption patterns from traditional to non-traditional dairy products such as yogurts, cheese, etc., are also propelling growth in the region’s dairy products market. Gujarat, is the leading producer of milk in the region and contributes significantly to the growth of dairy products market in the region. Government is taking measures to improve feeding practices and develop quality feeds and fodders to improve livestock productivity and dairy production
capacity, as a result of which livestock population has increased substantially in Gujarat.
25 © TechSci Research
India Dairy Products Market Share, By Region South Region South India ed for a revenue share of over 21.35% in India dairy products market in 2015 and this is projected to reach 23.12% by 2021. Increasing urbanization, rising working and youth population, and increasing spending power are anticipated to drive the demand for value added dairy products in the region. Andhra Pradesh
ed for the highest milk production in the region due to adequate grazing lands present in the region coupled with favorable weather conditions, an essential requirement for milch animals to give proper yield. East Region East India ed for a revenue share of 11.92% in India dairy products market in 2015. Dairy whitener
products are in huge demand in this region and exhibited a year-on-year growth of 15% in 2015. Various government initiatives and introduction of new policies such as subsidized feed and fodder and 30% subsidy on purchase of animals, etc., is encouraging farmers to produce milk in this region. With increasing demand for value added dairy products, increasing per capita income levels, growing youth population, etc., are major factors driving growth in East India dairy products market. The region revenue share in India dairy products market is projected to reach at 12.29% by 2021.
26 © TechSci Research
India Dairy Products Market Share, By Company Figure 7: India Dairy Products Market Share, By Company, By Value, 2011 – 2021F 43.34%
42.96%
15.46% 11.47% 8.41% 6.57%
2011
40.27%
39.75%
39.22%
38.66%
16.77%
17.05%
17.33%
17.61%
17.90%
18.20%
11.41%
11.34%
11.27%
11.20%
11.13%
11.07%
11.00%
10.93%
10.87%
10.80%
8.57%
8.75%
8.92%
9.10%
9.28%
9.47%
9.66%
9.85%
10.05%
10.25%
3.14%
3.17% 3.09%
3.08%
2.80%
2.84%
2.01%
2.04%
2.87% 2.07% 2.10%
2.00%
2.05% 2012
6.06%
6.23%
5.90%
3.20% 3.10%
2.90%
5.74%
3.23%
5.59%
5.44%
3.27%
3.30%
5.30%
5.16%
5.02%
3.33%
3.37%
3.40% 3.15%
3.11%
3.12%
3.12%
3.13%
3.14%
2.93%
2.97%
3.00% 2.53%
3.03% 2.66%
3.07%
2.20%
2.23%
2.27%
2.30%
2.31% 2.20% 2.10% 2.13%
2.42% 2.16%
2.79%
3.10% 2.92%
2.07%
2.08%
2.10%
2.12%
2.13%
2.15%
2.17%
2.18%
2.20%
2013
2014
2015
2016
2017
2018
2019
2020
2021
Gujarat Co-operative Milk Marketing Federation Ltd National Dairy Development Board Karnataka Cooperative Milk Producers Federation Ltd Others
40.77%
16.50%
1.91%
2.04%
41.24%
16.23%
3.08%
2.77%
41.70%
15.97%
3.10%
3.07%
42.14%
15.71%
6.40%
3.07%
1.98% 1.82%
42.56%
Tamil Nadu Cooperative Milk Producers Federation Ltd Heritage Foods Ltd
Maharashtra Rajya Sahakari Dudh Mahasangh Maryadit Andhra Pradesh Dairy Development Cooperative Federation Ltd Hatsun Agro Products Ltd Rajasthan Co-operative Dairy Federation Ltd
27
Bihar State Co-operative Milk Producers Federation Ltd
Others include Paras Dairy, Kwality Ltd, Parag, Milky Mist, Britannia, Gagan, Vita, Metro Dairy, Fresh'n Natural, Dahi Everyday Milk, DMS, Nestlé, Gagan. Source: TechSci Research
© TechSci Research
India Dairy Products Market Share, By Company India dairy products market is unorganized, with only a few notable players operating in the organized sector.
This trend is expected to change, as a number of private players are entering the market and existing organized market players are expanding operations in the country. Gujarat Co-operative Milk Marketing Federation Limited ed for a market share of 16.50% in India dairy products market in 2015. The company has presence throughout India and its market share in India dairy products market is projected to reach 18.20% by 2021, as the company is expanding its operations across the country. The company is also opening new dairy plants in Uttar Pradesh in order to address the growing demand in the region. Mother Dairy, which operates under National Dairy Development Board, ed for a market share of 11.20% in India dairy products market in 2015. The company’s market share is forecast to decline, due to
emergence of a number of private players in India dairy products market. These new companies are offering a wide range of attractively packaged products for consumers. Karnataka Cooperative Milk Producers Federation Limited, which operates under the brand Nandini garnered a market share of 9.10% in India dairy products market in 2015 and the company’s share is projected to reach 10.25% by 2021. The company with its aggressive expansion strategies entered Hyderabad and is offering tough competition to the existing local brands.
28 © TechSci Research
India Dairy Products Market Share, By Company Tamil Nadu Cooperative Milk Producers Federation Limited, operates under the brand Aavin, ed for a revenue share of 5.90% in India dairy products market in 2015. Entry of new players and changing consumer preferences towards non-traditional dairy products is anticipated to result in a decline in the company’s market share
to 5.02% in India dairy products market by 2021. Andhra Pradesh Dairy Development Cooperative Federation Ltd., operates under the brand Vijaya and ed for a revenue share of 3.20% in India dairy products market in 2015. The company’s market presence is largely limited to southern region and with many major private players entering the dairy market, the market share is anticipated to reach 3.10% in India dairy products market by 2021. Maharashtra Rajya Sahakari Dudh Mahasangh Maryadit, which operated under the brand Mahanand Dairy garnered a market share of 3.10% in 2015 and this is projected to reach 3.15% by 2021. The company mainly operates in the Maharashtra and has around 7 dairy units in the state. Rajasthan Co-operative Dairy Federation Limited ed for a market of 2.90% in 2015 and is expected to increase to 2.30% by 2021. The company operates under the brand name Saras and has presence in Rajasthan and in Delhi. Bihar State Co-operative Milk Producers Federation Limited ed for a market share of 2.10% in India dairy products market in 2015. The company operates in Bihar under the brand name Sudha and has around six
district level Milk Producers' Cooperative Unions, covering 31 districts.
29 © TechSci Research
India Dairy Products Market Share, By Company A large number of small players are setting up plants to enhance regional presence. The government is also providing various schemes and encouraging private players to establish their operations and introduce various polices to attract small scale industries. Heritage Foods Limited, based in Hyderabad, is a private player in India dairy products market and ed for a market share of 2.20% in India dairy products market in 2015 and this is projected to increase to 3.40% by 2021. The company, with its strategic expansion strategies to expand to National Capital Region (NCR), Mumbai and Pune. The company is also investing in retail stores across the nation to strengthen its position in the market. Hatsun Agro garnered a market share of 2.10% in India dairy products market in 2015 and is anticipated to reach a market share of 2.92% by 2021. The company has international presence and is also expanding domestically by starting operations in Tamil Nadu. The company also acquired and started a feed mill in Tamil Nadu in 2015. Others: Other players ed for a share of 41.7% in India dairy products market in 2015. These players are mainly small scale players who operate regionally such as Paras Dairy, Kwality Ltd, Parag, Milky Mist, Britannia, Gagan, Vita, Metro Dairy, Fresh'n Natural, Dahi Everyday Milk, DMS, Nestlé, Gagan, etc. The market share of the others segment is projected to reach 38.66% in India dairy products market by 2021.
30 © TechSci Research
India Dairy Market Share, By Market type
Organized sector in India ed for a revenue share of 30% in India dairy products market in 2015. Low share of the organized sector in India dairy products market can be attributed to the late entry of private players in the market and lower penetration of these companies in rural areas. Most players entered India dairy products market post 1991 and established dairy processing facilities. With the implementation of regulatory policies and schemes, the government is encouraging private players to establish dairy plants in India and also allowing foreign players to enter the market. The scenario is expected to change, as farmers are turning towards dairy farming, due to high profitability. Growth of the organized sector in India dairy products market in the coming years can be attributed to rising sales of value added dairy products such as cheese, yogurts, etc., and growing domestic demand for safe, nutritious and health-promoting convenient milk products. Revenue share of organized sector in India dairy products market is projected to reach 42% by 2021.
Figure 8: India Dairy Products Market Share, By
Figure 9: India Dairy Products Market Share, By
Organized vs Unorganized, By Value, 2015
Organized vs Unorganized, By Value, 2021F
Organized Sector, 30%
Organized Sector, 42% Unorganized Sector, 70% Unorganized Sector, 58%
31 Note: The organized sector consists of private companies, co-operatives etc., and un-organized sector consists of dairy farmers, very small scale industries Source: TechSci Research
© TechSci Research
M a r ke t At t ra c t ive n e s s I n d ex
Market Attractiveness Index Figure 10: India Dairy Products Market Attractiveness Index, By Type, By Value, 2015-2021F
40.00% 35.00%
Yogurts
CAGR (2016E-2021F)
30.00% 25.00% Cheese Probiotic Drinks
20.00%
Ice Cream
15.00% 10.00% 5.00%
Milk
Butter
Milk Powder Ghee
-1.00
0.00% 0.00
1.00
2.00
3.00
4.00
5.00
6.00
7.00
-5.00% Absolute Index Low
Medium
High
Note: The size of the bubble corresponds to the market size in 2015
33
Source: TechSci Research © TechSci Research
I n d i a D r i n k i n g M i l k M a r ke t O u t l o o k
I n d i a D r i n k i n g M i l k M a rke t S i z e & Fo re c a s t Figure 11: India Drinking Milk Market Size, By Value, 2011-2021F (USD Billion) CAGR 2016E-2021F By Value: 9.17%
CAGR 2011-2015 By Value: 5.15%
26.88
29.55
32.85
34.85
28.13
31.15
37.23
2011
2012
2013
2014
2015
2016E
2017F
40.12
2018F
43.70
2019F
48.21
2020F
54.03
2021F
Source: TechSci Research
Drinking milk market in India grew at a CAGR of 5.15%, in value , during 2011-2015 and reached USD32.85 billion in 2015. ing a CAGR of 9.17%, in value , during 2016-2021, the market for drinking milk in India is forecast to reach USD54 billion by 2021. Implementation of government policies to increase milk production and exports is propelling growth in India drinking milk market. Launch of new milk variants, entry of international players and increasing demand for packaged drinking milk are anticipated fuel growth in India drinking milk market in the coming years.
35 © TechSci Research
I n d i a D r i n k i n g M i l k M a rke t S i z e & Fo re c a s t Figure 12: India Drinking Milk Market Size, By Volume, 2011-2021F (Billion Liters) CAGR 2016E-2021F By Volume: 7.20%
CAGR 2011-2015 By Volume: 3.16% 46.43
48.66
50.51
52.39
57.38
60.76
46.26
54.65
64.99
2011
2012
2013
2014
2015
2016E
2017F
2018F
2019F
70.37
2020F
77.36
2021F
Source: TechSci Research
Drinking milk market in India grew at a CAGR of 3.16%, in volume , during 2011-2015 and is projected to grow at a CAGR of 7.20% during 2016-2021 Milk consumption in India is projected to reach over 77 billion liters by 2021 as compared to over 52 billion liters in 2015, due to increasing domestic demand, growing health concerns, rising per capita expenditure, increasing urbanization in Tier II & III cities. Competition Outlook: The milk market in the country has largely been dominated by various Co-operative Milk Marketing Federations and societies. These federations have been using a low pricing strategy in order to increase their share coupled with other private players present in the market. Foreign player such as Lactalis and Danone have entered the Indian market and have been engaging in various tie-ups with Indian companies in order to increase their presence in India. In 2014, Lactalis, a based
36
dairy company acquired Tirumala Milk Products to make enter into Indian dairy. © TechSci Research
Milk Production in India Table 2: India State wise Milk Production, 2010-11-2014-15 (Thousand Tonnes) State
2010-11
2011-12
2012-13
2013-14
2014-15
Uttar Pradesh
21,031
22,556
23,330
24,194
25,198.36
Rajasthan
13,234
13,512
13,946
14,573
16,934.31
Andhra Pradesh
11,203
12,088
12,762
13,007
9,656.15
Gujarat
9,321
9,817
10,315
11,112
11,690.57
Punjab
9,423
9,551
9,724
10,011
10,351.41
Madhya Pradesh
7,514
8,149
8,838
9,599
10,779.07
Maharashtra
8,044
8,469
8,734
9,089
9,542.29
Haryana
6,267
6,661
7,040
7,442
7,901.35
Bihar
6,517
6,643
6,845
7,197
7,774.89
Tamil Nadu
6,831
6,968
7,005
7,049
7,132.47
Karnataka
5,114
5,447
5,718
5,997
6,120.93
West Bengal
4,471
4,672
4,859
4,906
4,961
Kerala
2,645
2,716
2,791
2,655
2,711.13
Odisha
1,671
1,721
1,724
1,861
1,903.14
Jharkhand
1,555
1,745
1,679
1,700
1,733.72
Jammu & Kashmir
1,609
1,614
1,631
1,615
1,950.93
Uttarakhand
1,383
1,417
1,478
1,550
1,565.35
Chhattisgarh
1,029
1,119
1,164
1,209
1,231.57
Source: Department of Animal Husbandry
37 © TechSci Research
Milk Production in India Table 2: India State wise Milk Production, 2010-11-2014-15 (Thousand Tonnes) Contd. State
2010-11
2011-12
2012-13
2013-14
2014-15
Himachal Pradesh
1,102
1,120
1,139
1,151
1,172.16
Assam
790
796
800
815
829.47
Delhi
480
502
287
284
280.06
Tripura
104
111
118
130
141.23
Manipur
78
79
80
82
82.17
Meghalaya
79
80
81
82
82.96
Nagaland
76
78
79
81
75.69
Goa
60
60
61
68
66.6
Puducherry
47
45
47
47
47.64
Sikkim
43
45
42
46
49.99
Chandigarh
45
45
44
44
44
Arunachal Pradesh
28
22
23
43
46.07
Mizoram
11
14
14
15
20.49
Andaman & Nicobar
25
26
21
14
15.56
Dadra & Nagar
11
11
11
11
8.52
Lakshadweep
2
2
2
6
4.19
Daman & Diu
1
1
1
1
0.82
Overall
121,844
127,902
132,433
137,686
146,300
Source: Department of Animal Husbandry
38 © TechSci Research
Price Point Analysis
Figure 13: India Drinking Milk Average Selling Price, 2011-2021F (USD per Liter)
0.581
0.606
0.607
2011
2012
2013
0.627
0.638
0.649
0.660
0.672
0.685
0.698
0.617
2014
2015
2016E
2017F
2018F
2019F
2020F
2021F
Source: TechSci Research
Average selling price of drinking milk in India grew at a slow pace, during 2011-2015 and is expected to follow the same trend in the next five years. The ASP of drinking milk in India stood at USD0.62/liter in 2015 and this is forecast to rise to USD0.69/liter by 2021. Increasing consumption of milk in urban and rural areas, due to rising health concerns, increasing share of
organized market, etc., are driving growth in the ASP of drinking milk.
39 © TechSci Research
Competition Outlook
Top States
Gujarat Cooperative Milk Marketing Federation Ltd
Mother Dairy Fruit & Vegetable Pvt Ltd
Karnataka Cooperative Milk Producers Federation Ltd
Tamil Nadu Cooperative Milk Producers Federation Ltd
Andhra Pradesh Dairy Development Cooperative Federation Ltd
Rajasthan Co-operative Dairy Federation Ltd
Uttar Pradesh
Rajasthan
Andhra Pradesh
Gujarat
Punjab
Karnataka
Maharashtra
40 © TechSci Research
I n d i a G h e e M a r ke t O u t l o o k
I n d i a G h e e M a r ke t S i z e & Fo re c a s t Figure 14: India Ghee Market Size, By Value, 2011-2021F (USD Billion) CAGR 2011-2015 By Value: 3.40%
CAGR 2016E-2021F By Value: 4.41%
20.78
22.12
23.75
24.55
25.45
21.35
22.99
26.48
2011
2012
2013
2014
2015
2016E
2017F
2018F
27.64
28.96
30.46
2019F
2020F
2021F
Source: TechSci Research
Ghee ed for a revenue share of 23.75.45% in India dairy products market in 2015. India ghee market grew at a CAGR of 3.4%, in value , during 2011-2015, to reach USD23.80 billion. ing a CAGR of 4.41%, in value , during the forecast period, India ghee market is projected to reach USD30.50 billion by 2021. Penetration of ghee is higher in North and West regions of the country. India ghee market is dominated by unorganized players and the trend is expected to change in the coming five years, due to changing consumers preferences for value added dairy products, increasing concerns about quality, etc.
42 © TechSci Research
I n d i a G h e e M a r ke t S i z e & Fo re c a s t Figure 15: India Ghee Market Size, By Volume, 2011-2021F (Billion Kilograms)
CAGR 2011-2015 By Value: 1.14%
6.30
6.35
2011
2012
6.45
2013
CAGR 2016E-2021F By Value: 1.50 %
6.55
6.59
6.63
6.69
2014
2015
2016E
2017F
6.77
2018F
6.87
2019F
6.99
2020F
7.14
2021F
Source: TechSci Research
Volume market for ghee in India grew at a CAGR of 1.14% through 2011-2015 and is forecast to grow at a CAGR of 1.05% during the forecast period. Sales of ghee, a traditional dairy product in India, is expected to reach 7.14 billion kilograms by 2021 from 6.59 billion kilograms in 2015. Value added dairy products such as butter, cheese, etc., have not been able to penetrate into the rural market, due to low acceptance of these products and rising demand for traditional dairy products such as ghee.
43 © TechSci Research
Price Point Analysis
Figure 16: India Ghee Average Selling Price, 2011-2021F (USD per Kilogram)
3.30
3.36
3.43
3.51
3.61
3.70
2011
2012
2013
2014
2015
2016E
3.81
3.91
4.02
4.14
4.27
2017F
2018F
2019F
2020F
2021F
Source: TechSci Research
Ghee, a traditional dairy product in India, has an average selling price of USD3.61 per kilogram in 2015. The prices of ghee are expected to grow at a steady pace during the forecast period and reach USD4.27 per kilogram by
2021.
A huge demand for ghee is emanating from the rural market. Companies operating in the organized sector are introducing various products with packaging innovations to assure quality.
44 © TechSci Research
Competition Outlook
Top States
Gujarat Cooperative Milk Marketing Federation Ltd
Mother Dairy Fruit & Vegetable Pvt Ltd
Karnataka Cooperative Milk Producers Federation Ltd
Tamil Nadu Cooperative Milk Producers Federation Ltd
Andhra Pradesh Dairy Development Cooperative Federation Ltd
Rajasthan Co-operative Dairy Federation Ltd
Uttar Pradesh
Rajasthan
Andhra Pradesh
Gujarat
Punjab
Karnataka
Maharashtra
45 © TechSci Research
I n d i a B u t te r M a r ke t O u t l o o k
I n d i a B u t te r M a r ke t S i z e & Fo re c a s t Figure 17: India Butter Market Size, By Value, 2011-2021F (USD Billion) CAGR 2011-2015 By Value: 5.76%
4.81
5.02
5.28
2011
2012
2013
CAGR 2016E-2021F By Value: 9.14%
5.60
6.02
6.49
7.02
2014
2015
2016E
2017F
7.62
2018F
8.30
2019F
9.10
2020F
10.05
2021F
Source: TechSci Research
Butter market in India grew at a CAGR of 5.76%, in value , during 2011-2015, and reached USD6 billion in 2015. Butter market in India is further forecast to grow at a CAGR of 9.14%, in value , during 2016-2021 to reach USD10 billion by 2021. In 2015, butter ed for a revenue share of 6.70% in India dairy products market in 2015, and this is projected to reach 7.54% by 2021, on of increasing acceptance of packaged dairy products, rising
penetration of domestic and international players in Tier II & III cities, increasing health awareness among consumers, presence of variety of low fat and low cholesterol butter variants in the market. The organized sector has influenced consumption of butter in the country and demonstrated substantial improvements quality, health benefits, low caloric consumptions.
47 © TechSci Research
I n d i a B u t te r M a r ke t S i z e & Fo re c a s t Figure 18: India Butter Market Size, By Volume, 2011-2021F (Billion Kilograms)
CAGR 2011-2015 By Volume: 2.39 %
CAGR 2016E-2021F By Volume: 4.76%
1.70
1.84
1.55
1.60
1.64
1.91
1.57
1.76
2.00
2011
2012
2013
2014
2015
2016E
2017F
2018F
2019F
2.11
2020F
2.23
2021F
Source: TechSci Research
With changing consumer food consumption patterns, tastes and preferences, butter consumption in India is
anticipated to grow at a CAGR of 4.76%, in volume , during 2016-2021. Butter consumption in India is anticipated to reach 2.23 billion kilograms by 2021 from 1.70 kilograms in 2015. Increasing demand butter in India can be attributed to changing lifestyles of the urban population. Manufacturers are offering innovative products such as low fat butter and producing different varieties such as salted butter, unsalted butter, sweet butter etc.
48 © TechSci Research
Price Point Analysis Figure 19: India Butter Average Selling Price, 2011-2021F (USD per Kilogram)
3.11
3.20
3.30
2011
2012
2013
3.41
3.54
3.68
3.82
3.98
2014
2015
2016E
2017F
2018F
4.14
4.32
4.51
2019F
2020F
2021F
Source: TechSci Research
Butter, a non-traditional dairy product in India, is projected to witness an increase in ASPs over the forecast period. The ASP of butter in India stood at USD3.54 per kilogram in 2015 and this is projected to reach USD4.51 per kilogram by 2021. Growing demand for butter in urban areas, rising availability of number of variants such as low fat and zero cholesterol butter, rising health concerns and growing willingness among consumers to purchase butter is driving ASPs of butter in the country.
49 © TechSci Research
Competition Outlook
Top States
Gujarat Cooperative Milk Marketing Federation Ltd
Mother Dairy Fruit & Vegetable Pvt Ltd
Karnataka Cooperative Milk Producers Federation Ltd
Tamil Nadu Cooperative Milk Producers Federation Ltd
Andhra Pradesh Dairy Development Cooperative Federation Ltd
Rajasthan Co-operative Dairy Federation Ltd
Uttar Pradesh
Rajasthan
Andhra Pradesh
Gujarat
Punjab
Karnataka
Maharashtra
50 © TechSci Research
I n d i a I c e C re a m M a r ke t O u t l o o k
I n d i a I c e C re a m M a r ke t S i z e & Fo re c a s t Figure 20: India Ice Cream Market Size, By Value, 2011-2021F (USD Billion)
CAGR 2011-2015 By Value: 11.37%
CAGR 2016E-2021F By Value: 17.03%
0.91
1.00
1.11
1.24
1.40
2011
2012
2013
2014
2015
1.59
2016E
1.82
2017F
2.11
2018F
3.49 2.92
2.47
2019F
2020F
2021F
Source: TechSci Research
Ice cream market in India is grew at a CAGR of 11.37%, in value , during 2011-2015 and is forecast to grow at a CAGR of over 17% during 2016-2021, to reach USD3.49 billion by 2021 from USD1.40 billion in 2015. Innovations in flavors, expertise to create ice cream for different segment of consumers, entry of number of international players offering a wide range of ice creams such as low-fat ice creams, etc., are fueling growth in ice cream market in India. Consumption of ice cream throughout the year, coupled with improvements in packaging to ensure quality are driving demand for ice cream in India.
52 © TechSci Research
I n d i a I c e C re a m M a r ke t S i z e & Fo re c a s t Figure 21: India Ice Cream Market Size, By Volume, 2011-2021F (Billion Liters) CAGR 2011-2015 By Volume: 3.76%
CAGR 2016E-2021F By Volume: 4.20%
0.40
0.44
0.46
0.38
0.39
0.42
0.48
2011
2012
2013
2014
2015
2016E
2017F
0.50
0.53
0.55
0.56
2018F
2019F
2020F
2021F
Source: TechSci Research
Ice cream market in India grew at a CAGR of 3.76%, in volume during 2011-2015 and is anticipated to grow at a CAGR of 4.20%, during the forecast period. India ice cream market is projected to reach 0.56 billion liters by 2021 from 0.44 billion liters in 2015. Changing consumer preferences and eating habits, entry of a number of players, launch of new flavors, increasing disposable incomes, rising availability of product in the market and increasing preference for consuming products is driving demand for ice creams in India.
53 © TechSci Research
Price Point Analysis Figure 22: India Ice Cream Average Selling Price, 2011-2021F (USD per Liter)
6.19
2.57
2.98
3.20
2.41
2.77
3.46
2011
2012
2013
2014
2015
2016E
3.78
2017F
4.18
2018F
4.69
2019F
5.34
2020F
2021F
Source: TechSci Research
Due to increasing per capita expenditure and shifting consumption trends towards ice creams, the ASP of ice creams in India is projected to increase during 2015-2021, reaching USD6.19/liter by 2021 from USD3/liter in 2015. With international players entering India and offering wide range of flavors that are being accepted by consumers, domestic companies are also investing in the market space, and this has resulted in an increase in the ASP of ice creams in the country. However, penetration of international brands in the ice cream segment is still very low and is limited to urban areas. This offers domestic players with a competitive edge to tap the rural areas and introduce traditional and nontraditional ice cream flavors.
54 © TechSci Research
Competition Outlook
Top States
Vadilal Industries Ltd
Gujarat Cooperative Milk Marketing Federation Ltd
Kwality Limited
Mother Dairy Fruit & Vegetable Pvt. Ltd
Devyani Food Industries Pvt Ltd
Uttar Pradesh
Rajasthan
Andhra Pradesh
Gujarat
Punjab
Karnataka
Maharashtra
55 © TechSci Research
I n d i a M i l k Powd e r M a r ke t O u t l o o k
I n d i a M i l k Powd e r M a rke t S i z e & Fo re c a s t Figure 23: India Milk Powder Market Size, By Value, 2011-2021F (USD Billion) CAGR 2016E-2021F By Value: 5.79%
CAGR 2011-2015 By Value: 9.46%
0.78
0.85
2011
2012
0.94
2013
1.04
2014
1.12
2015
1.20
2016E
1.28
2017F
1.36
2018F
1.44
1.51
2019F
2020F
1.59
2021F
Source: TechSci Research
•
Milk powder is usually used as a substitute for milk and manufacturing value added dairy products such as ice creams, etc. Milk powder market in India stood at USD1.12 billion in 2015, and a CAGR of 9.46%, in
value , during 2011-2015 and this is projected to grow at a CAGR of 5.79%, in value , during 20162021. The milk powder market in India is forecast to be valued at USD1.59 billion by 2021. •
The eastern region which is a milk deficit region mainly is dependent of milk powder and other dairy products such as coffee whiteners as substitute for milk. This gives manufacturers a huge opportunity to capture the untapped market.
57 © TechSci Research
I n d i a M i l k Powd e r M a rke t S i z e & Fo re c a s t Figure 24: India Milk Powder Market Size, By Volume, 2011-2021F (Billion Kilograms)
CAGR 2016E-2021F By Volume: -2.62%
CAGR 2011-2015 By Volume: 4.14% 0.26
0.26
0.26
0.26 0.25
0.24
0.24
0.24
0.24 0.23
0.22
2011
2012
2013
2014
2015
2016E
2017F
2018F
2019F
2020F
2021F
Source: TechSci Research
Milk powder market in India grew at a CAGR of 4.14%, in volume , during 2011-15 and is anticipated to witness a decline at a CAGR of -2.62%, in volume , by 2021. Although, growing demand from the eastern region is offering opportunities to manufacturers to increase profitability. Production of skimmed milk powder is anticipated to decline, as the prices are unstable in the international market. This is due to surplus milk powder being produced after the European Union lifting the quota system for imports.
58 © TechSci Research
Pricing Analysis Figure 25: India Milk Powder Average Selling Price, 2011-2021F (USD per Kilogram)
3.48
3.57
3.84
3.93
2011
2012
2013
2014
4.25
2015
4.60
2016E
4.99
2017F
5.41
2018F
5.87
2019F
6.39
2020F
6.96
2021F
Source: TechSci Research
ASP of milk powder in India have been inconsistent in international market over the last few years due to issues related to over supply. The prices are gaining stability slowly and is expected to grow consistently through the forecast period.
Milk powder prices are projected to increase from USD4.25 per kilogram in 2015 to USD6.96 per kilogram by
2021. The market is gaining stability due to implementation of export regulations.
59 © TechSci Research
Competition Outlook
Top States
Gujarat Cooperative Milk Marketing Federation Ltd
Mother Dairy Fruit & Vegetable Pvt Ltd
Karnataka Cooperative Milk Producers Federation Ltd
Tamil Nadu Cooperative Milk Producers Federation Ltd
Andhra Pradesh Dairy Development Cooperative Federation Ltd
Rajasthan Co-operative Dairy Federation Ltd
Uttar Pradesh
Rajasthan
Andhra Pradesh
Gujarat
Punjab
Karnataka
Maharashtra
60 © TechSci Research
I n d i a C h e e s e M a r ke t O u t l o o k
I n d i a C h e e s e M a r ke t S i z e & Fo re c a s t Figure 26: India Cheese Market Size, By Value, 2011-2021F (USD Billion) CAGR 2016E-2021F By Value: 21.32%
CAGR 2011-2015 By Value: 13.24%
0.17
0.19
0.22
0.25
0.29
0.33
2011
2012
2013
2014
2015
2016E
0.39
2017F
0.47
2018F
0.57
2019F
0.88 0.70
2020F
2021F
Source: TechSci Research
India cheese market was valued at around USD0.29 billion in 2015 and is forecast to reach USD0.88 billion by 2021. Cheese was traditionally not very popular in India, but with changing lifestyles and increasing visibility of
products, demand for cheese in India witnessed growth at a CAGR of 13.24%, in value , during 2011-2015. As cheese market is slowly starting to saturate in the US, Europe etc., India is being seen as potential market by foreign players. India has around 30 popular cheese variants as compared to 3,000 variants available in the global market. Majority of these cheese variants are available only in modern retails.
Dominated by the unorganized market in India, cheese market in India is projected to grow at a CAGR of over 21%, in value , during 2016-2021. The processed cheese market garnered a 45% in the India cheese market, which includes all spreads, cubes, slices, tins, slabs, etc.
62 © TechSci Research
I n d i a C h e e s e M a r ke t S i z e & Fo re c a s t Figure 27: India Cheese Market Size, By Volume, 2011-2021F (Billion Kilograms)
CAGR 2016E-2021F By Volume: 22.54 %
CAGR 2011-2015 By Volume: 15.01 %
0.07 0.06
0.01
0.01
0.02
0.02
0.02
2011
2012
2013
2014
2015
0.03
2016E
0.03
2017F
0.04
2018F
0.05
2019F
2020F
2021F
Source: TechSci Research
Cheese market in India is projected to witness growth at a CAGR of over 22%, in volume , during 20162021 as compared to over 15% during 2011-2015. Demand for cheese is projected to increase, on of rising disposable income, changing food preferences, high urbanization, etc. Cheese is also a major ingredient of western cuisine such as pizzas, pastas, etc. Demand for cheese mostly emanates from urban areas and is expected to reach rural areas due to changing consumer preferences, etc. Total annual consumption of cheese, in volume , is projected to reach 0.07 billion kilograms by 2021 from 0.02 billion kilogram in 2015.
63 © TechSci Research
Price Point Analysis Figure 28: India Cheese Average Selling Price, 2011-2021F (USD per Kilogram)
14.11
2011
13.83
2012
13.62
2013
13.43
2014
13.26
2015
13.10
2016E
12.95
2017F
12.82
2018F
12.69
2019F
12.57
12.46
2020F
2021F
Source: TechSci Research
The prices of cheese varies according to the type, and if it is imported or produced domestically. The average price of cheese in India stood at USD13.26 per kilogram in 2015. The cheese market in India is largely untapped. Rising number of domestic and foreign players entering the market, increasing demand and competition is anticipated to fuel a decline in the prices of cheese in the coming years. The price of cheese in India is anticipated to decline to USD12.46 per kilogram by 2021.
64 © TechSci Research
Competition Outlook
Top States
Gujarat Cooperative Milk Marketing Federation Ltd
Britannia Dairy Pvt Ltd
Mother Dairy Fruit & Vegetable Pvt Ltd
Parag Milk Foods Pvt. Ltd
Milky Mist Dairy
Uttar Pradesh
Rajasthan
Andhra Pradesh
Gujarat
Punjab
Karnataka
Maharashtra
65 © TechSci Research
I n d i a Yo g u r t s M a r ke t O u t l o o k
I n d i a Yo g u r t s M a r k e t S i z e & Fo r e c a s t Figure 29: India Yogurts Market Size, By Value, 2011-2021F (USD Billion)
CAGR 2016E-2021F By Value: 34.32%
CAGR 2011-2015 By Value: 28.91%
1.02 0.74
0.07
0.08
0.10
0.14
2011
2012
2013
2014
0.18
0.23
2015
2016E
0.31
2017F
0.40
2018F
0.54
2019F
2020F
2021F
Source: TechSci Research
India yogurts market grew at a CAGR of 28.91%, in value , during 2011-2015. The market is projected to grow at a CAGR of 34.32%, in value , during 2016-2021. India yogurts market stood at USD0.18 billion and is forecast to reach USD1.02 billion by 2021. Demand for frozen yogurts in India is projected to grow at a faster pace through the forecast period. Easy availability of various functional products, and rising emphasis on low calorie and low fat content of food products is driving the acceptance of yogurts in India. Yogurts are gradually taking over the traditional dairy products in urban and semi urban cities, on of increasing health awareness, better quality of packaged yogurts, rising awareness about products, etc.
67 © TechSci Research
I n d i a Yo g u r t s M a r k e t S i z e & Fo r e c a s t Figure 30: India Yogurts Market Size, By Volume, 2011-2021F (Billion Liters)
CAGR 2016E-2021F By Volume: 25.17%
CAGR 2011-2015 By Volume: 7.88%
0.09 0.07 0.06
0.02
0.02
0.02
0.02
2011
2012
2013
2014
0.02
2015
0.03
2016E
0.04
2017F
0.04
2018F
2019F
2020F
2021F
Source: TechSci Research
Yogurts market in India witnessed growth at a CAGR of 7.88%, in volume , during 2011-2015 and the market is anticipated to grow at a CAGR of over 25% during the forecast period. Entry of private players in the
market and availability of different flavors and low fat products in this segment is driving consumption of yogurts in India from 0.09 billion liters by 2021 from 0.02 billion liters in 2015. Rising awareness about the health benefits of products, increasing disposable income levels, growing demand from middle class segment, affordable prices, etc., are driving demand for yogurts in India.
68 © TechSci Research
Price Point Analysis
Figure 31: India Yogurt Average Selling Price, 2011-2021F (USD per Liter)
3.57
2011
4.63
2012
5.68
2013
6.56
2014
7.28
2015
7.86
2016E
8.47
2017F
9.11
2018F
9.78
2019F
10.47
2020F
11.19
2021F
Source: TechSci Research
The ASP of yogurts n India stood at USD7.28 per liter in 2015 and this is projected to increase to USD11.19 per liter by 2021. The average price of yogurts is anticipated to grow consistently through 2021.
The product is gaining popularity in India due to the entry of a number of organized players in the market. With growing demand and presence of lesser number of companies offering yogurt, the prices of these products are anticipated to grow through 2021.
69 © TechSci Research
Competition Outlook
Top States
Karnataka Cooperative Milk Producers Federation Ltd
Gujarat Cooperative Milk Marketing Federation Ltd
Mother Dairy Fruit & Vegetable Pvt Ltd
Nestlé India Ltd
Tamil Nadu Cooperative Milk Producers Federation Ltd
Uttar Pradesh
Rajasthan
Andhra Pradesh
Gujarat
Punjab
Karnataka
Maharashtra
70 © TechSci Research
I n d i a P ro b i o t i c D r i n k s M a r ke t O u t l o o k
I n d i a P ro b i o t i c D r i n k s M a rke t S i z e & Fo re c a s t Figure 32: India Probiotic Drinks Market Size, By Value, 2011-2021F (USD Billion) CAGR 2016E-2021F By Value: 17.48%
CAGR 2011-2015 By Value: 13.31%
0.085
0.071 0.060
0.020
0.022
0.025
2011
2012
2013
0.029
2014
0.033
2015
0.038
2016E
0.044
2017F
0.051
2018F
2019F
2020F
2021F
Source: TechSci Research
India probiotic drinks market is still in nascent stage, the market is projected to grow at a CAGR of over 17% during the forecast period. Probiotic drinks market in India was valued at USD0.033 billion in 2015 and reach USD0.08 billion by 2021, due growing awareness and products visibility. Growing demand for probiotics drinks can be attributed to rising health issues, increasing consumer awareness, entry of several international and domestic players in the segment and increasing visibility of the product in the market.
72 © TechSci Research
I n d i a P ro b i o t i c D r i n k s M a rke t S i z e & Fo re c a s t
Figure 33: India Probiotic Drinks Market Size, By Volume, 2011-2021F (Billion Kilogram) CAGR 2016E-2021F By Volume: 12.14%
CAGR 2011-2015 By Volume: 10.24 %
0.019
0.007
2011
0.008
2012
0.009
2013
0.010
2014
0.011
2015
0.012
2016E
0.013
2017F
0.015
2018F
0.021
0.016
2019F
2020F
2021F
Source: TechSci Research
Probiotic drinks market in India has very few organized players. Probiotic drinks market in India grew at a CAGR of 10.24%, in volume , during 2011-2015 and is anticipated to grow at a CAGR of 12.14%, in volume , during 2016-2021. The market for probiotic drinks in India is anticipated to grow, due to increasing visibility of the product and rising awareness regarding health benefits of these products.
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Price Point Analysis
Figure 34: India Probiotic Drinks Average Selling Price, 2011-2021F (USD per Liter)
2.77
2.82
2.89
2.98
2011
2012
2013
2014
3.09
3.21
3.35
3.50
3.67
2015
2016E
2017F
2018F
2019F
3.85
2020F
4.06
2021F
Source: TechSci Research
The average selling price of probiotic drinks in India increased during 2011-2015 and is projected to rise at a steady pace through the forecast period. Probiotic drinks in India are being sold at an average price of USD3.09/liter and this is projected to rise to USD4.06/liter by 2021.
Increasing consumption of probiotic drinks in urban areas, growing health concerns, rising disposable income, etc., are driving growth in the ASPs of probiotic drinks in the country.
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Competition Outlook
Top States
Mother Dairy
Gujarat Cooperative Milk Marketing Federation Ltd
Yakult Danone India (P) Ltd.
Nestle India Ltd
Karnataka Cooperative Milk Producers Federation Ltd
Uttar Pradesh
Rajasthan
Andhra Pradesh
Gujarat
Punjab
Karnataka
Maharashtra
75 © TechSci Research
I n d i a O t h e r D a i r y P ro d u c t s M a r ke t O u t l o o k
I n d i a O t h e r D a i r y P ro d u c t s M a r ke t S i z e & Fo re c a s t Figure 35: India Other Dairy Products Market Size, By Value, 2011-2021F (USD Billion)
CAGR 2016E-2021F By Value: 4.25%
CAGR 2011-2015 By Value: 5.13%
19.78
20.75
21.56
2011
2012
2013
22.46
2014
24.16
2015
25.70
2016E
28.85
30.18
31.18
31.65
27.34
2017F
2018F
2019F
2020F
2021F
Others include paneer soy milk kohya and other sweets Source: TechSci Research
Others segment consists of traditional dairy products such as Khoya, etc., and non-traditional dairy products such as sour milk, dairy whiteners, creams, etc. These products are not produced by organized players and the market for other dairy products in India is dominated by unorganized players. The market also includes flavored drinks that are produced locally. Other dairy products market is was valued at USD24.16 billion in 2015, which grew at a CAGR of 5.13%, in value , during 2011-2015. The market is projected to reach USD31.65 billion by 2021, exhibiting a CAGR of 4.25%, in value , during forecast period. Other Dairy Products includes Dairy Whiteners, Cream, Butter Milk, Paneer, Curd, Flavored Milk, Whey Powder, Baby Food, Lactose, Soy Milk, Khoya, Milk-based Sweets, Lassi, Milk Proteins, Acid Casein, Margerines, etc.
77 © TechSci Research
Import-Export Analysis Market Intelligence . Consulting
Import-Export Analysis
Dairy exports from India are not significant due to high in-house consumption. Skimmed milk powder segment is emerging as the largest export segment, after the Indian government lifted bans on exports of skimmed milk powder.
Prices of milk and value added dairy products are lower compared to other exporting nations, due to low labor costs and huge production, resulting in growing demand, especially from the Middle East, Southeast Asia and South Asia. Pakistan, Afghanistan and Bangladesh being the major importers of dairy products from India.
The countries such as Russia, the major importers of dairy products, do not import from India due to quality constraints. Co-operatives and private players are focusing on improving the quality of products. In 2015, Russia is exporting dairy products from India due to increasing demand.
79 © TechSci Research
Import-Export Analysis Figure 36: India Dairy Product Exports to Top 5 Countries, By Value, 2013-2014 & 2014-2015 (USD Million)
104.6
50.3 36.9
30.7
33.0
28.7 11.3
Bangladesh
United Arab Emirates 2013-14
Pakistan
18.5
Nepal
3.7
8.0
Bhutan
2014-15 Source: DGCIS
Exports of milk has been comparatively low due to high domestic consumption. With the European Union lifting the ban on quotas, India is eyeing to target the EU market by exporting finished dairy products to the region. Increasing exports from India can be attributed to rising presence of private companies in India. Most of the private dairy companies are engaged in exports of dairy products given the profitability and demand for Indian
traditional sweets and ghee. Demand for these products is very high in the international market.
80 © TechSci Research
Import Analysis In order to control the increasing prices of dairy products, government imported milk powder and butter at concessional duties in 2011. International milk prices in 2011 were higher by 17.75% YOY. Therefore, the government removed duty on skimmed milk products during the years 2010-2011 to control the prices. The main
reason for the high costs of milk powder in India was higher cost of procurement. Being the major milk producer, India does not import milk. In 2014-2015, India imported 5.28 thousand liters of milk contributing to USD 0.01 million in FY 2014-2015.
Table 03: India Dairy Product Imports, By Value (USD Million), By Volume (Thousand Tonnes), 2011-2015 Product Name
Volume
Value
2010-11
Volume
Value
2011-12
Volume
Value
2012-13
Volume
Value
2013-14
Volume
Value
2014-15
Milk powder
10,094.00
32.88
4,613.29
21.55
156.96
0.58
429.48
1.59
280.65
2.08
Ice cream
145.09
0.74
279.2
0.91
473.13
1.73
987.27
3.66
1,335.51
4.79
372.95
65.34
70.25
26.5
108.44
2.77
50.59
1.67
87.64
4.38
Cheese
411.05
1.84
298.33
2.39
214.94
1.55
62.01
0.35
34.98
0.27
Yogurt
189.93
0.46
90.29
0.31
87.29
0.27
97.37
0.26
22.74
0.07
Ghee
570.65
1.73
564.79
1.98
523.06
1.75
308.86
1.06
1,308.40
3.66
Butter
81
Source: Ministry of Commerce © TechSci Research
Export Analysis Ghee and butter are the key export products from India. Ghee is a traditional dairy product and has high demand in the foreign markets. Given cheap labor and production costs, the export price of ghee remains low. This also has created a major demand in the neighboring countries such as Bangladesh and Nepal. High consumption of milk in the country is the major reason for the low exports of milk. Bangladesh and UAE are the major importers of milk from India.
Table 04: India Dairy Product Exports, By Value (USD Million), By Volume (Thousand Tonnes), 2011-2015
Produc t Name
Volume
Value
2010-11
Volume
Value
2011-12
Volume
Value
2012-13
Volume
Value
2013-14
Volume
Value
2014-15
Milk
477.52
0.43
295.49
192.81
146.41
0.17
223.66
0.27
1,470.95
1.28
Milk powder
2,385.52
8.69
204.89
0.54
353.17
1.16
6,085.46
23.9
1,091.65
3.98
Ice cream
277.81
0.53
350.2
0.82
356.29
1.09
547.1
1.52
652.39
3.98
Butter
5,496.69
21.32
1,742.83
7.65
988.27
4.58
3,210.44
12.74
2,890.56
13.31
Cheese
1,083.68
3.01
722.99
2.83
910.91
3.78
896.06
4.01
1,745.54
6.54
Yogurt
2.08
0
0.66
0
8.23
0.02
28.14
0.07
2.44
0.02
Ghee
4,390.82
20.07
5,346.31
29.28
5,052.63
26.17
4,932.25
27.15
5,707.64
34.35
Source: Ministry of Commerce
82 © TechSci Research
Supply Chain Analysis
Supply Chain Analysis
Inputs for Dairy • • •
Fodder Farming Veterinary Aid Animal Feed
Milk Production •
Large & Small scale Farmers
Chilling & Bulk Cooling
Milk Collection •
Chilling center at Villages & Districts
•
Milk Aggregators
Restaurants/Bakery Shops
Unorganized Sector
Value Added Dairy Products
Consumer
Marketing & Distribution • •
Retail Outlets Super/Hyper markets
Processing & Packaging •
Private & Government Plants
Transportation of Chilled Milk •
Refrigerated Vans
84 © TechSci Research
Supply Chain Analysis Supply chain for dairy industry in India begins from supply of raw materials such as fodder, veterinary aid, etc., to the farm till the finished products reach end consumers. Milk produced at the farm level is procured from the bulk collection and chilling centers and processed using various techniques. The raw milk procured is stored at the bulk chilling centers and the solid fats are separated from the milk to manufacture products such as skimmed milk powder and whey powder, which require fats. Drinking milk is extracted from raw milk by processing it using various techniques, at the manufacturing facility
from where drinking milk, UHT, etc. are obtained and value added dairy products such as cream, yoghurt, cheese, milk powders, flavored milk, etc., are produced. These products are then treated to ensure that all bacteria and other pathogens are eliminated, and later stored at chilling and bulk cooling centers. Milk and other products are transported to packaging warehouses by using cold chain transportation, where the products are then packed according to requirements. From the packaging center, these dairy products are distributed to various retail outlets, from where they are delivered to consumers. Dairy products market which is majorly dominated by unorganized market distributes milk directly to consumers. The milk delivered does not always meet the required standards as it does not undergo any processing or treatment. Raw milk is also delivered to restaurants and other small industries, which produce value added dairy products at a small scale and is sold locally.
85 © TechSci Research
Supply Chain Analysis Supply Chain Models & Technology Used Gujarat Co-operative Milk Marketing Federation Ltd., which operates under the brand name of Amul, follows a 3 tiered structure of supply chain wherein, milk producers supply milk to village dairy cooperative societies which is then processed at district cooperative unions and marketed by state marketing federations. Amul has created a network of more than 3 million milk producers which is processed by more than 25 district unions before, finally, reaching to the consumer. Amul has more than 30 sales offices with over 5000 wholesale distributors and around 700,000 retail outlets across the country. Mother Dairy works on a comparatively simpler supply chain model. The company sources milk from dairy cooperatives which is delivered through insulation tankers at 2 degree Celsius, in order to retain the
freshness of the milk. Milk, along with other dairy products, then reaches the customer through retail and exclusive Mother Dairy outlets. The milk and other dairy products are transported through reefer vehicles. These insulated tankers carry milk from regional collection centers and these vehicles are, then, utilized to transfer processed milk to the distributors. These insulation tankers typically covers the maximum distance of 100 kilometers from the chilling centers to deliver the products to mother dairy outlets. These insulated vehicles equipped with refrigeration unit and the temperature of the products are maintained at not more than 3-4 degree Celsius while transferring dairy products. ColdEX Logistics, Kelvin Cold Chain Logistics Pvt. Ltd., ColdStar Logistics Pvt. Ltd., Snow King Logistics, etc. are few of the leading companies which provides logistics services to dairy products manufacturers and dairy cooperative societies.
86 © TechSci Research
Supply Chain Analysis
These logistic companies are introducing various technologies to ensure the delivery of fresh milk to the destination. The
vehicles are equipped with GPS tracking units which shows parameters like temperature,
route, speed of the vehicle, fuel consumption, time left to reach the destination, etc. Few of the vehicles are also installed with temperature loggers, which can monitor the temperature of the products. Companies like Hatsun Agro Products Ltd. Procures around 2.5 million litres of milk per day from more than 3,000,000 farmers in South India. The company has chilling centers in more than 85 locations from where around 1500 vehicles collect milk and supply to 9 processing dairies. Milk shed spreads over 5 districts in Telangana and Andhra Pradesh, 3 districts in Karnataka, 10 districts in Tamil Nadu and 1 district in Maharashtra. Heritage Foods is doing its business through a chain of exclusive retail stores, Heritage Fresh. The company has around 110 retail stores across three cities, 60 in Hyderabad, 16 in Bangalore and around 35 in Chennai. The dairy products ranges from, along with other products, milk, curd, ice cream, butter milk, dairy whitener, skimmed milk powder, etc. The company has more than 5000 sales agents and have given self employment
opportunity to 11,000+ procurement agents in rural areas.
87 © TechSci Research
Market Dynamics
Market Dynamics
Drivers
Increasing Health Awareness
Challenges Lack of Efficient Supply Chain Management
Rising Cattle Feed Prices Rising Disposable Income
Growing Demand for Value Added Dairy Products
Unorganized Players Dominate
89 © TechSci Research
Drivers
Increasing Health Awareness Youth population, which has high exposure to digital media, is aware about the health benefits of milk-based nutritional beverages and its advantages. The youth population of the country has started adopting healthy dietary habits such as consumption of dairy products along with health supplements. Increasing awareness in rural and semi urban areas through television ments to purchase quality packaged products and rising incidence of malnutrition have also contributed to increasing consumption of milk and other dairy products in the country. Rising demand for low fat products from health conscious consumers, can be attributed to high risk of diseases such as obesity, high blood pressure, heart attacks, etc. Parents have also become aware about health benefits of consuming dairy products, which may otherwise lead to malnutrition. The National Family Healthy Survey shows that the percentage of underweight and malnutrition children in India declined to 29.40% in 2014 from 42.5% in 2005-2006.
90 © TechSci Research
Drivers
Rising Disposable Income Rising disposable income levels has increased purchasing power of consumers. Consumers are opting for value added dairy products and packaged dairy products keeping in mind their nutritional content such as low fat and low cholesterol. Growing disposable income levels has resulted in improvements in standards of living of the people in India. Purchasing power of Indian consumers is expected to increase further in the coming years, thereby resulting in an increase in sales of milk and other value added dairy products such as ghee, cheese, butter, yogurts, probiotic drinks, etc.
Figure 37: India Disposable Personal Income, 2011 – 2015 (USD Billion) 2,303 1,593
2011-12
1,724
2012-13
1,872
2013-14
2014-15
91 Source: MOSPI © TechSci Research
Drivers Growing Demand for Value Added Dairy Products Buying and consumption patterns for dairy products have changed manifolds in India. With this shift in consumption patterns, demand for VADP such as ghee, cheese, butter, etc., has increased over the last few years. India drinking milk market is forecast to grow at a CAGR of 9.17%, in value , during 2016-2021. Ghee, butter, cheese and yogurts are expected to witness growth in demand during the coming years. Also, dairy product manufacturers are advertising VADPs as low fat, healthy products and this is encouraging consumers to increase consumption of these products. Increasing demand for VAPD can be attributed to changing food consumptions habits of costumers especially in urban areas. Figure 38: India Year on Year Growth Comparasion for Value Added Dairy Products and Non Value Added Dairy Products 2012-2021F
5.57%
6.67%
7.75%
4.66%
5.04%
5.43%
2012
2013
2014
12.10%
13.30%
14.76%
9.12%
9.68%
10.34%
11.13%
5.46%
5.65%
5.87%
6.17%
6.54%
7.00%
7.56%
2015
2016E
2017F
2018F
2019F
2020F
2021F
Non Value Added Dairy Products
92
Value Added Dairy Products Source: TechSci Research
© TechSci Research
Challenges Lack of Efficient Supply Chain Management Poor road conditions in India increases the transportation time required for dairy products, which may lead to spoilage of dairy products due to bacterial growth. The shelf life of milk and other dairy products is very low and in order to reduce spoilage of these products during transport, synthetic ingredients are often added, which may lead to hazardous diseases such as heart problems, kidney damage, etc. It is not feasible to transport/procure milk in India to longer distances, due to perishability of the product and lack of proper cold supply chain facilities for small players, especially in Tier II and III cities. Majority of the transport is owned by independent drivers and hence lack of proper organization leads to improper supply chain management, resulting in delay in milk deliveries.
93 © TechSci Research
Challenges Rising Cattle Feed Prices
•
The major cost involved in dairy farming is cattle feed, which constitutes to about 69% of the total cost of production. There is a shortage of dry fodder during the monsoon season. This increases the prices of dry fodder due to high demand and low supply. Due to less availability of fodder, the milch animals produce less milk during the monsoon season.
•
The area under fodder cultivation is estimated to be about 4% of the gross cropped area. The grazing lands are
also gradually diminishing due to other competing pressures on land and priority is being given to cash crops.
Figure 39: India Demand & Availability of Feed and Fodder, 2014 (Million Tonnes)
416 253
222 143 53
Dry Fodder
Green Fodder
Demand
Availability
23
Concentrate
94 Source: DAHD © TechSci Research
Challenges Unorganized Players Dominate
The unorganized sector ed for a share of 70% in India dairy products market in 2015. The quality of milk sold in semi-urban and rural areas by the unorganized players is not regulated. In addition, rural market lacks awareness regarding health issues associated with adulterated or contaminated milk. Unorganized players dominate dairy products market in rural areas, where the milk sold is sub-standard, unpasteurized, and more often than not adulterated with harmful chemicals. Women in rural areas are
uneducated and also unaware of the quality standards and there is no proper mechanism to control adulteration. In addition, according to Food Safety and Standards Authority of India, about 70% milk samples collected across the country did not meet the required standards and water was the most common adulterant in milk. This shows the need for organized players in the market, who offer safer and hygienic products.
Bihar, Chhattisgarh, Odisha, West Bengal, Mizoram, Jharkhand, Daman & Diu, etc., are some of the states in the country, ensuring adequate quality standards according to Food Safety and Standards Authority of India.
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M a r ke t Tre n d s & D eve l o p m e n t s
Market Trends & Developments
1
Implementation of Favorable Government Initiatives
2 3
4
5
Adoption of Automation by Private Players
Rising Demand for Yogurt and Western Dairy Products
Steady Rise in Demand for Organic Milk
Increasing Demand For Packaged Products
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Implemen ta tio n o f Favo ra ble G overn men t In itia tives
Implementation of various governments initiatives such as National Dairy Plan to increase health awareness through various schemes such as ‘Mission Milk’ launched in April 2012, at National Dairy Development Board (Anand, Gujarat), in rural and urban areas led to a increase in demand for quality milk. Government realized the potential in this industry and launched various proactive measures to guide investors interested in establishing dairy processing plants and dairy farms. The government offers 25% subsidy on the establishment of small dairy processing units. With NABARD subsidy, the government is trying to bring structural changes in the unorganized sector to make initial milk processing possible at the village level. The Indian government with its various schemes is trying to strengthen the dairy industry in the country. Majority of the players in India dairy industry operate in the unorganized sector and the government is undertaking initiatives to change the scenario and have better control over quality. In the last 4-5 years, the dairy sector received private equity investments worth USD0.36 billion and foreign
players are also trying to enter India. Foreign players such as Danone Food and Beverages, Fonterra, HaagenDazs, etc. have entered into some segments of the market and are trying to increase their presence in the other dairy market segments.
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Adoption of Automation by Private Players Dairy product manufacturers operating in the organized sector in India are investing in technology upgradations to increase productivity. Integration of latest technology in the dairy industry would enable easy monitoring of cattle health, thereby
limiting human interference. This trend is catching up among companies in India, due to their rising IPOs and increasing number of foreign players entering the market. Precision automation technologies and other technologies such as Daily milk yield recordings, Milk component monitoring (e.g. fat, protein, and SCC), Pedometers, Automatic temperature recording devices, Milk conductivity indicators, Automatic estrus detection monitors, and Daily body weight measurements would further boost the dairy industry in India Producers are focusing on promoting their dairy products, as free from bacteria due to the use of automated systems that ensures optimal cow wellbeing and minimal human handling. Rising number of bulk milk coolers and milk processing technologies that convert milk into other dairy products with a longer shelf life have not only reduced losses associated with the perishability of milk, but also opened up
new markets for surplus milk production.
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R i s i n g D e m a n d f o r Yo g u r t s a n d We s t e r n D a i r y P r o d u c t s Western dairy products such as creams, butter, cheese, etc., witnessed steady demand, due to changing lifestyles and diet patterns. With around 30% of the total population living in urban cities, demand for these products is projected to remain limited to major cities in India. Rising influence of the western culture has increased demand for processed food in the country. Also these products are ready to eat or easy to cook food products. Major players are investing in manufacturing of western products such as cheese and butter, on of rising demand for these products. Packaged yogurts in India are also witnessing substantial increase in demand, due to changing lifestyles of the young working class, coupled with rising disposable incomes levels of consumers.
Figure 40: India Year on Year Growth Comparasion for Indigenous Dairy Products and Western Dairy Products 2012-2021F
4.79%
5.85%
6.97%
4.28%
4.42%
4.79%
2012
2013
2014
10.91%
12.01%
13.39%
8.82%
9.38%
10.06%
5.53%
5.96%
6.23%
6.57%
6.98%
7.48%
5.58%
2015
2016E
2017F
2018F
2019F
2020F
2021F
8.34%
Indigenous Dairy Products
100
Western Dairy Products Source: TechSci Research
© TechSci Research
Steady Rise in Demand for Organic Milk Natural, functional, fresh foods in addition to products labelled as low calorie, lower sodium, no trans fats, gluten-free and GMO-free are appealing the health-savvy consumers in the country. Of late, consumers are turning towards adulteration-free, farm fresh milk and producers have also started advertising their products, as completely automated without interference of humans, thereby reducing chances of contamination. Growing demand for organic milk can be attributed to rising adulteration and increasing incidence of diseases associated with the consumption of contaminated milk. Upper middle and affluent class consumers in urban areas, especially in the metropolitan cities in India, are willing to pay a price for organic milk to stay healthy. In 2015, the market size for Organic milk in India was around USD40 million. Whereas, the overall organic dairy products market was around USD70 million. Further, demand for organic milk in India is projected to grow in the coming years, with producers advertising it as free from chemicals, pesticides and injected hormones. With the market being untapped, local players are trying to capture the segment, with the launch of numerous schemes and ments. However, supply chain and preservation remains a massive challenge in this segment. Companies such as Govind Organic Milk, Doctor Moo, Pride of Cows have been offering organic milk in cities such as Mumbai, Pune and Bangalore.
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I n c re a s i n g D e m a n d Fo r Pa c k a g e d P ro d u c t s Demand for packaged dairy products is increasing in India, as consumers are becoming conscious about the hygiene of products. Manufacturers are also demonstrating the need for packaged dairy products and are providing consumers with various options such as tetra packs, etc., which help increase the shelf life of the product. The seven layer packaging of tetra packs also allows manufacturers to ensure that dairy products do not get
sour in a short period of time, and longevity. Also given the lifestyle changes, the products can be stored easily for a longer duration of time and hygiene can be ensured at the same time. Food Safety and Standards Authority of India mandates that packaged products must be produced with proper labelling, showing manufacturing date, nutritional value, expiry date, price, quantity, etc. This information makes it easy for consumer to make purchasing decisions.
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Policy & Regulatory Landscape Market Intelligence . Consulting
Policy & Regulatory Landscape
ISO International Organization for Standardization: ISO, the world’s leading developer of voluntary international standards, is an independent, non-governmental international organization for maintaining standards for production, packaging, etc. Most companies to maintain ISO standards, while they require rigorous quality protocols to be maintained. The ISO standards specify quality checks, hygiene levels, and how the quality checks have to be performed, etc. ISI Indian Standards Institute: ISI mark provides customer the guarantee of quality, safety and reliability. ISI mark is mandatory for dairy products such as milk powder. Companies have to follow certification procedures and obtain licenses to use ISI mark. Prevention of Food Adulteration (PFA) Act 1954: PFA Act was introduced to regulate adulteration of food products, which was rampant in India, especially in liquid dairy products. According to this Act, package foods need to carry a label, without any misleading information, notice of addition, ixture or deficiency in food, expiry dates etc. Milk and Milk Product Order (MMPO): MMPO was introduced by Food Safety and Standards Authority of India (FSSAI) in 1992, with an objective to maintain and increase supply of drinking milk of desired quality and regulating production, processing and distribution of milk and milk products. A certificate of registration is necessary under this order for setting up a dairy project in India.
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Policy & Regulatory Landscape
Food Safety and Standards Authority of India: FSSAI setup a few regulatory standards and guidelines for packaging dairy products, with a few minimum requirements such as Date of manufacture, Date of packaging, Lot number, Use – by date under packaging and labelling. The certification enables regulation of quality and safety of dairy products. The standards are updated regularly and products such as cheese, butter, infant milk, milk powder, etc., have to maintain required standards ranging from where and how the milk is procured, processing, packing, cleaning of the plants to disposal of the products. Foreign Direct Investment (FDI): Foreign Direct Investment (FDI) is made directly into production in a country by a company located in another country, either by buying a company in the target country or by
expanding operations of an existing business in that country. The government has allowed 100 per cent Foreign Direct Investment (FDI) in agriculture sector. Certain rules and regulations which are to be followed under this areRearing of animals under intensive farming systems with stall-feeding. Intensive farming system will require climate systems (ventilation, temperature/humidity management), health care and nutrition, herd ing/pedigree recording, use of machinery, waste management systems as prescribed by the National Livestock Policy, 2013 and in conformity with the existing ‘Standard Operating Practices and Minimum Standard Protocol.
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Policy & Regulatory Landscape Import Duty Structure Table 5: India Dairy Products Import Duty Structure, 2015 Products Along with HS Code
Basic Duty
CVD
Special CVD
Milk & Cream Not Concentrated containing added sugar(0401)
30%
0%
4%
Milk & Cream Concentrated containing added sugar (0402)
60%
0%
4%
Butter Milk, Curdled Milk & Cream, Yogurt and other fermented or acidified milk and cream (0403)
30%
0%
4%
Butter & Other fats and oils derived from milk, dairy spreads (0405)
40%
0%
4%
Cheese and Curd (0406)
30%
0%
4%
Ice Cream and other edible ice (2105)
30%
6%
4% Source: DGFT
As per the regulations ed by the directorate general of foreign trade, the imports of all dairy products are banned from China till 23rd June 2016. Impact of proposed GST on Dairy products: It is anticipated that the minimum rate of GST to be proposed by the Indian government is 18%. Currently, there is no tax levied upon any fresh dairy products like raw milk, products. Also, apart from the sterilised-sweetened-flavoured milks, none of the dairy products attract excise duty. If 18% rate is applied on the dairy Industry, would have direct implication on milk producers and would result in a decline in the prices of raw milk as paid to the milk producer.
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India Economic Profile
India Economic Profile Population (Million)
Female : Male Ratio (2015)
2015
1304.16 48.37%
2020F
1353.00
51.63%
Source: : World Bank
Population of India, Urban vs Rural 2015E
33%
Urban Population
67%
Rural Population
Population Growth Rate (2015)
1.34%
Source: : World Bank
Source: : World Bank
Unemployment Rate in India, 2015E
3.70%
3.70%
Inflation Rate in India
12.00 %
3.60%
9.30% 6.40%
3.50% 2010
5.80%
Source: : World Bank
Modes of Transport Mode
Number
Airports
346
Heliports
45
Railways
64,600 km
Roadways
4,689,842 km
Waterways
14,500 km
Merchant Marines
340
Pipelines
22,667 km
95 108 2012
2014
2015
2010
Source: World Bank
2012
2014
2015
Source: : Central Intelligence Agency
© © TechSci TechSci Research Research
India Economic Profile India’s GDP at Market Price (Constant), 2011-2015
India’s GDP Growth Rate, 2011-2015
(USD Billion) 1835.81
1831.78
1861.8
2308.02
2041.52
6.60%
6.90%
7.17%
7.46%
2013
2014
2015
5.10%
2011
2012
2013
2014
2015
2011
2012
Source: : World Bank, IMF
Source: : World Bank, IMF
GDP Share 2015
Sectorial Growth (2015)
17.00%
Agriculture
30.00%
Industry
53.00%
Source: : World Bank
Services
1.10%
5.90%
11.00 % Source: : World Bank
96 109 © © TechSci TechSci Research Research
C o m p e t i t ive L a n d s c a p e Market Intelligence . Consulting
G u j a r a t C o o p e r a t ive M i l k M a r k e t i n g Fe d e r a t i o n L t d . BUSINESS OVERVIEW •
•
•
•
• •
Gujarat Cooperative Milk Marketing Federation Ltd was founded in 1946 in Anand, Gujrat It is the Apex organization of the Dairy Cooperatives of Gujarat, popularly known as AMUL GCMMF procures 14.85 million liters of milk per day from 18,536 village milk cooperative societies covering 31 districts, and 3.37 million milk producer . The cooperative has a strong dealer network of 10,000 dealers and 10 lakh retailers operating through 56 sales offices. The company has a employee strength of approximately 750 people. In 2015, the company was planning to invest INR5 billion for the next 3 years to set-up new plants and to increase the milk production.
Certifications • ISO 2200:2005 • ISO 9001 • ISO 9001:2000 • ISO 22000:2005
RECENT DEVELOPMENTS • January 2016: Amul partnered with Wow designs for a design makeover for its flavored milk product, Amul Kool Milkshakes to rebrand Amul Kool Milkshake' as 'Amul Kool Shakers. • January 2016: The company inaugurated modernized semen station at Ode village, Gujarat. The plant was constructed at a cost of USD1.3 million. The semen station is run by Amul Research and Development Association (ARDA) • October 2015: In a move to expand its presence in Punjab GCMMF will procure milk from 1,000 villages in Punjab by putting up modern milk testing and weighment and bulk milk cooler system • August 2015: The company invested USD1.6 million approximately to triple its cheese production. • April 2015: Amul invested USD22 million to expand its presence in Punjab from 50 collection centers to 1,000. • February 2015: The company launched a super range of ice cream under the name Epic. • January 2015: Gujarat Cooperative Milk Marketing Federation Ltd. ppartnered with WOW Design for redeg the Amul Scooping Parlors, visually and structurally.
KEY PRODUCTS • Milk • Milk powder • Health beverages • Butter, Ghee • Cheese, • Ice cream, Paneer • Traditional Indian sweets
Key Personnel • Verghese Kurien(Co-founder) • Jethabhai P. Patel (Chairman) • R S Sodhi (Managing director)
Key Person • Atul Santoki (General Manager Marketing) • Nitin Mohan Shandilya (Marketing and Business Development ) • Email: [email protected]
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N a t i o n a l D a i r y D e ve l o p m e n t B o a r d BUSINESS OVERVIEW
• National Dairy Development Board (NDDB) was
•
• •
•
founded in 1947 and doing business as Mother Dairy. The company is headquartered in Gujarat, India. NDDB manufactures and produces dairy products, edible oils, fruits & vegetables, frozen vegetables, processed food such as fruit juices, jams, pickles etc. The company employees around 3,500 people With state of the art manufacturing plants in Patparganj, Delhi. Pilkhuwa, UP, Vashi, Mumbai. Kachchh Junagadh, Gujarat. Tirupati, Andhra Pradesh. The company has covered 3,351 villages with additional hip of 177,507 producers.
Certifications : • FDA Certification • FSSC Certificate • EIA certification • ISO – 9001:2008 • ISO – 22000:2005 • HALAL • ISO 2200 • Kosher • SGF certification
KEY PRODUCTS Recent Developments • February 2016: The company announced • Milk • Milk powder to invest USD8.7 million for setting up a • Health beverages plant for frozen vegetables and fruit pulp • Butter off Ranchi, Jharkhand, and USD23 • Ghee million for setting up a facility for milk • Cheese and value-added dairy products near • Ice cream, Paneer Mumbai. • January 2016: Mother Dairy partnered with Environnemental Infrastructure & Services Ltd (IEISL) for selling organic compost product through Safal outlets, which is being supplied from Okhla composting facility, a public private partnership between IEISL and South Delhi Municipal Corporation for processing of biodegradable to compost. Key Person • September 2015: The company setup a • T N Datta, (General Manager) NDDB foundation to facilitate supply of free • +91-2692-226222 milk to underprivileged school children • July 2015: NDDB launched a mobile Key Personnel application that suggests a balanced diet • Shri T. Nanda Kumar (Chairman) • Dr S. Ayyappan (Secretary) for cows and buffaloes to help boost • Shri Jethabhai P. Patel (Chairman) dairy farmers' income by raising milk • Shri V. Kehie (Chairman) yield and cutting feed cost. HEADQUARTERS / • April 2015 : Mother dairy is planning to Address expand its business in east India by National Dairy Development Board PB No. 40 introducing dairy whitener products. • August 2014: National Dairy Anand - 388 001 Telephone: 91-2692-260148, Development Board (NDDB) launched a 260149, 260159, 260160 multi-pronged program involving Fax:91-2692-260157, 260165 cooperatives, to raise milk productivity e-mail: [email protected] and ensure remunerative prices to dairy Gujarat INDIA farmers in Odisha.
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K a r n a t a k a C o - O p e ra t ive M i l k P ro d u ce r s Fe d e ra t i o n Limited BUSINESS OVERVIEW
• Karnataka
Co-Operative Milk Producers Federation Limited headquartered in Bangalore operates under the brand name Nandini. • The company was started as a agency in 1975 aided by the World Bank and became a cooperative in 1983. • The company has its own packaging plant, Nandini Packaging Film Plant located near Bangalore.. • The company has regional presence in Karnataka mainly and operates across south India. • Karnataka Co-Operative Milk Producers Federation Limited has 2.32 million milk producers in over 13,157 Dairy Cooperative Societies at village level. • The company has 14 milk unions throughout the state, which procure milk from Primary Dairy Cooperative Societies (DCS) and distribute it to consumers in various urban and rural markets in Karnataka. • The company’s plant at Channarayapatna, Hassan District (Karnataka) with 400 Thousand Liters Per Day (TLPD) and 30 Metric Tons Per Day (MTPD ) Cream storage 60 KL, Butter storage 580 MT, Ghee storage 150 MT. The plant is setup in 22 acres of land.
The company has plants located at KEY PRODUCTS • Milk • Mother Dairy, Yelahanka, Bangalore. • Curds & other fermented products • Nandini Hi-Tech Product Plant, • Milk powder Channarayapatna. • Ghee & butter • Nandini Milk Products, KMF Complex, • Ice cream & Frozen Desserts Bangalore. • Milk Sweets • Cattle Feed Plants at Rajanukunte/ • Other Products • Chocolate Gubbi/ Dharwad/ Hassan/ Shikaripura. • Nandini Sperm Station (formerly known • UHT Milk as Bull Breeding Farm & Frozen Semen Recent Developments Bank) at Hessaraghatta. • June 2015:The company is • Nandini Packaging Film Plant at expanding its network in Munnekolalu, Marathhalli. Karnataka and invest USD 307 • Central Training Institute, Bangalore & million from 2015-2017, across a Training Institutes at Mysore/Dharwad number of facilities, including bulk • Ice Cream Plant, Bellary milk coolers, processing unit besides packaging and marketing Recent Developments facilities. • February 2016 :The company in a bid • May 2015:The company started to boost sales announced plans to open marketing its products in retail units in apartment complexes. It Hyderabad. has planned to setup parlors in 100 apartments in Bangalore. 2016: Karnataka CoOperative Milk Producers Federation Limited announced plans to introduce pet bottles for milk and curd and setup 100 MT capacity. February 2016: The company announced plans to setup two automated milk conversion plants, each with 100 MT capacity for an investment of USD47 million.
• February
•
Key Person • Ravikumar Kakade Director (Marketing) Email: [email protected]
11 3 © TechSci Research
Ta m i l N a d u C o - o p e r a t i v e M i l k P r o d u c e r s ' F e d e r a t i o n Limited BUSINESS OVERVIEW • Tamil Nadu Co-operative Milk Producers' Federation Limited founded in 1985, operates under the brand name Avvin milk and is headquartered in Chennai. • The company is a cooperative and functions under the Department of Animal Husbandry, Dairying and Fisheries (Tamil Nadu). The company is engaged in manufacturing milk and milk products. • The company has four manufacturing plants at Ambattur, with a capacity of 4 lakh liters per day, Madhavaram with a capacity of 3 lakh liters per day, Sholinganallur with a capacity of 4 lakh liters per day and Ambattur, which is engaged in manufacturing milk products • The company has three different wings for carrying out marketing of milk and milk products - Metro Liquid milk marketing, Metro Milk Product marketing and Up country marketing. • The company operates through 17 district Cooperative Milk Producers’ Unions functioning in Tamil Nadu, covering 30 Districts. There are 15 Dairies in District Co-operative Milk Producers' Unions with an installed processing capacity of 19.42 lakh liters per day (llpd) and 36 Chilling Centers (Functional) in District Co-operative Milk Producers' Unions with installed chilling capacities of 13.55 llpd. • The company has a R&D farm at Udhagamandalam, funded by ‘The erstwhile Indian Dairy Corporation” and technical guidance provided by ‘National Dairy Development Board’.
RECENT DEVELOPMENTS • June 2015: In order to simplify the milk distribution procedure, Avvin made onine milk cards. The consumers can procure milk cards post verification though its website in the year. • June 2015: A new plant to be commissioned in Perambalur at a cost of USD5.5 million with a capacity of producing one lakh litres of milk. • June 2015: The Coimbatore’s plant is to expand its capacity from present 2 lakh litres to 5 lakh litres per day with a investment plan of USD7.09 million. • January 2016 : The company set up its own treatment plant at Salem Tamil Nadu and is designed to treat 10 lakh liters of waste water a day at an average COD (chemical oxygen demand) load of 3,500 mg / liter.
KEY PRODUCTS • Milk • Ghee • Butter • Curd • Flavored Milk • Paneer • Milk powder • Cheese • Yoghurt • Cream • Butter milk • Ice-creams Certifications • The company has the following certifications for its manufacturing plants • ISO 9001:2000. • ISO 9002
Key Person • Mr M. Sundarapandian (DGM Marketing) Telephone no 044-23464578 Key Personnel • Mr. Thiru Sunil Paliwal (Managing Director • Tel no:23464504 HEADQUARTERS / Address Tamilnadu Co-operative milk producers' Federation Ltd., Aavin Illam, Madhavaram Milk Colony, Chennai 600051- Tamilnadu
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Andhra Pradesh Dairy Development Cooperative Fe d e ra t i o n L i m i te d BUSINESS OVERVIEW
Certifications
• Headquartered in Hyderabad, Andhra Pradesh
• Andhra Pradesh Dairy Development
Dairy Development Cooperative Federation Limited was established in 1981. • The company is engaged in manufacturing and distribution of milk and milk products Andhra Pradesh and Telangana. • The company’s milk procurement operations cover 11 districts. • The company is the major supplier of milk to Hyderabad. • Andhra Pradesh Dairy Development Cooperative Federation (APDDCF), has a milk processing unit at Kankipadu, Andhra Pradesh. • The company has around 14 dairy plants in the states of Andhra Pradesh and Telengana.
Other Relevant Information • The company has plants in Warangal, Hyderabad, Mahbubnagar, Khammam, Godavari, Chittoor, Krishna, Nizamabad, Medak, Karimnagar, Eluru, Kadapa, Ananthapur and Kankipadu • The company exports Vijaya milk and ultra high temperature (UHT) milk varieties, buttermilk, basundi, curd, lassi, butter milk, paneer, cooking butter, milk cake, ghee, skimmed milk powder and khoa to Southeast Asian countries. • The company exports ghee to Dubai, UAE and other west Asian countries and milk cream to South Africa.
•
•
•
Cooperative Federation Limited was the first dairy in the country to receive SA 8000 certification from the SGS International Agency of Sweden APDDCF (Andhra Pradesh Dairy Development Cooperative Federation Limited) received ISO 14001 certification in 2004, which recognizes it as the only unit in the country producing products suitable to international market. The dairy unit also has a license to enter food processing industry and manufacture juices and other high acid products. The factory of A.P. Dairy Development Cooperative Federation (APDDCF) at Lalapet was awarded ISO 9001:2008 certification by the British Standard Institute for receiving, processing and supply of milk and manufacture and supply of milk products.
KEY PRODUCTS • Curd • Butter milk • Ghee • Paneer • Doodh peda • Butter
Key Person
• • •
Dr. Papa Rao Iragavarapu General Manager Mr. Krishna Swamy Deputy Director Mobile No: +91 9440314094 Landline No: 0870-2447132
Key Personnel • Adhar Sinha, Managing Director
HEADQUARTERS / Address Andhra Pradesh Dairy Development Cooperative Federation Limited, Lalapet, Hyderabad Phone number +91-40-27019851 Email : [email protected]
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H e r i t a g e Fo o d s L i m i te d ( B S E : 5 1 9 5 5 2 )
Public 60%
Promoters 40%
Source: Company Annual Report
SEGMENTAL REVENUE BREAK UP 2014-15 By Business Segments 100%=USD310.33 Million Bakery, 0.28%
Agriculture, 3.92%
Dairy, 72.62%
Retail, 23.06% Renewable Energy, 0.12%
Source: Annual Report
Financial Metrics (USD Million) Particulars
2014-2015
2013-2014
Revenues
310.33
257.78
%growth
83%
92%
PBT
13.18
14.75
RECENT DEVELOPMENTS • August 2014: The company % margin 4.25% 5.72% announced plans to invest USD24 million during 2015-2019. PAT 4.22 6.78 • February 2015: The company % margin 1.36% 2.63% announced plans to invest USD4.3 Source: Annual Report million in the Dairy segment to increase its footprint in northern PE Ratio: 22.58 Share Price: INR 507.90 and western parts of the country. Mkt Cap: USD10.83 Billion as on 13th Feb- 15 Key s Source: BSE Joseph Rajiaj, AGM, Sales & STOCK PRICE PERFORMANCE Marketing) Stock Price Comparison Vs Indices Venkat Samavedam, Sales Manager 5 Feb ’15 – 8 Jan ’16 Email: 800.0 1,000.00 venkat.samavedam@heritagefoods. com 600.0 Key Personnel 400.0 500.00 • Mr. Seetharamiah Devineni (Chairperson) 200.0 Mr. Srivishnu Raju Nandyala(Director) 0.0 Mr. Lokesh Nara (Director) Feb-15 May-15 Aug-15 Nov-15 KEY FACTS ERM (VO) ERM BSE 250 Listing : BSE Source: BSE India, As on 08 January, 2016 Symbol: 519552 Debt and Cash Availability FYE :31ST Mar Industry: Dairy 2855.1 1272.4 HEADQUARTERS / 119.3 98.0 Address Dairy6-3-541/C, Panjagutta 2014-15 2013-14 Hyderabad - 500 082 Phone: 040 Debt Cash & Cash Equivalents 2339 1221 / 222 Source: Annual Report Fax: 040 - 3068 5458 Note : Debt Includes Short & Long term Borrowings Email: [email protected] Volume
OWNERSHIP STRUCTURE 2014-15
KEY PRODUCTS • Milk • Curd, • Ice cream, • Buttermilk • Flavoured milk • Dairy whitener • Skim milk powder
KEY METRICS
Share Price (INR)
BUSINESS OVERVIEW • Founded in 1992, Heritage Foods Limited has five main business segments - Dairy, Retail and Agriculture, Renewable Energy and Bakery. • Its headquarters is located in Hyderabad, India • The company has presence in Andhra Pradesh, Telangana, Karnataka, Kerala, Tamil Nadu, Maharashtra, Odisha and NCR Delhi for procurement and distribution of milk and milk products and its retail stores across Bangalore, Chennai and Hyderabad. • The company has around 3,000 employees across the nation. • The company has 134 bulk cooling and chilling plants. 14 Processing and packaging plants • The company is eyeing more than 10% of its revenue from e-commerce from next fiscal year.
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H e r i t a g e Fo o d s L i m i te d ( B S E : 5 1 9 5 5 2 ) Operating History
The company announced to setup 100 retail stores in the next five years with a investment of USD7.32 million in 2015.
2015 2014
2013
•
•
The company started commercial production at its 14th Packing Station in Industrial Area, Sonipet in Haryana.
The company has moved its retail business into a wholly owned subsidiary in 2013
117 Source: Company Website & Annual Reports
© TechSci Research
Hatsun Agro Products Limited (BSE: 531531)
Bodies Corporate 3.07%
Non Institutions 20.91% DII 0.02% FII Institutions 2.86% 2.88%
Promoter and Promoter Group 70.27%
Source: Company Annual Report
SEGMENTAL REVENUE BREAK UP 2014-15 By Business Segments By Geography (100% = USD439.72 million)
Financial Metrics (USD Million)
Particulars
2014-15
2013-14
Revenues
439.72
374.33
%growth
17.47%
3.74%
30.57
27.87
EBIT
Certifications • Food Safety Management % margin 6.95% 7.44% System Standard of ISO 22000:2005 PAT 5.86 12.22 • Quality Management System % margin 1.33% 3.26% Standard of ISO 9001:2008 Source: Company Annual Report • Environmental Management System Standard of ISO Share Price : INR 404.0 PE Ratio: 72.59 14001:200 Mkt Cap : USD43.49 Billion As of 8th January 2016 • MMPO -1992 Registration – Source: BSE FSSAI STOCK PRICE PERFORMANCE Key Person: Stock Price Comparison Vs Indices Sathyan Chandramogan, 4 Feb’15 – 8 Jan’16 Executive Director 10.0 300 Sam Joseph, Deputy 200 General Manager, Sourcing 5.0 100 Phone:08045316297 KEY FACTS 0.0 0 Listing : BSE Tickers: 531531 FYE : 31 Jan‘11 Industry: Dairy Products ERM (VO) ERM BSE 250 Source: BSE Volume
OWNERSHIP STRUCTURE 2014-15
KEY PRODUCTS • Dairy Whitener, • Skimmed Milk Powder • Ghee • Butter • Milk • Curd • Paneer
KEY METRICS
Share Price (INR)
BUSINESS OVERVIEW • Established in the year 1970 as M/s. R.G. Chandramogan & Co. set up Hatsun Foods Private Limited The company was incorporated as Hatsun Foods Private Limited in 1986 and went public in 1996 with its headquarters in Chennai. • The company is into manufacturing and distribution of dairy products across American, Middle East and South East Asian Markets • Hatsun Agro has 10 Manufacturing plants in India. • The Company’s sales were recorded at INR 2493.54 Crores in n 2013-14. • In Dec 2015, the company was planning to acquire cattle feed mill in Tamil Nadu. This move will further expand its cattle feed capacity.
Debt and Cash Availability (USD Million) Ice cream , 7.60% Milk products , 18.13%
38,914
Other, 1.01%
Milk , 74.27%
India, 98.99%
2013-14 Debt
Source: Company Annual Report
52,363 17,549
35,488
2014-15
Cash & Cash Equivalents Source: Company Annual Report
HEADQUARTERS / HATSUN AGRO PRODUCT LTD Domaine, Door No: 1/20A, Rajiv Gandhi Salai (OMR), Karapakkam, Chennai - 600 097. India. Phone: 044-24501622. Email : [email protected]
118 © TechSci Research
Hatsun Agro Products Limited (BSE: 531531) Operating History
Hatsun Agro Products finalized plans to acquire a cattle feed mill in Tamil Nadu for USD 2.8 Million
2015
2014
2013
•
The company launched ready-to-eat range of dishes under the brand Oyalo in 2014.
The company in 2013 expanded into Andhra Pradesh with the acquisition of Jyothi Dairy, set up a greenfield dairy plant and acquired a cattle feed plant in Tamil Nadu .
119 Source: Company Website & Annual Reports
© TechSci Research
OWNERSHIP STRUCTURE 2014-15 Public 30.44%
Promoter & Promoter Group 69.56% Source: Annual Report
SEGMENTAL REVENUE BREAK UP, 2014-15 By Business Segments (100%=USD 878.20 Million) Milk Powder 8%
Ice-cream 4% Curd Cheese Butter 1% 1% Flavoured Milk 1% Paneer 1%
Liquid Milk 76%
Ghee 8%
Source: Annual Report
KEY PRODUCTS • Drinking Milk • Paneer • Flavored Milk • Cheese • Curd • Butter • Ice-cream • Ghee • Milk Powder
KEY METRICS Financial Metrics (USD Million)
Particulars
2014-2015
2013-2014
Revenues
878.20
763.00
%growth
15.10%
23.99%
EBITDA
54.93
46.00
%margin
6.25%
6.03%
RECENT DEVELOPMENTS • June 2014: The company signed PAT 23.49 21.11 a Memorandum of Understanding with Central Bank %margin 2.67% 2.77% of India to provide financial Source: Annual Report assistance to milk producing Share Price: INR115.70 PE Ratio: 15.21 farmers. Mkt Cap: USD422.17 Million as of 1st April 2016 Key Person • Rajesh Sahu (General Manager, Source: NSE Sales) STOCK PRICE PERFORMANCE • Gagandeep Singh Marwah (Sales Stock Price Comparison Vs Indices Manager) March’15 – March’16 200.0 10.00 • +91-11-47006500 8.00 150.0 Key Personnel 6.00 • Dr. Rattan Sagar 100.0 4.00 Khanna(Chairman) 50.0 2.00 • Mr. Sanjay Dhingra (Managing 0.0 Director) Apr-15 Jun-15 Aug-15 Oct-15 Dec-15 Feb-16 KEY FACTS KWALITY (VO) KWALITY NSE Listing : BSE Symbol: 531882 Source: NSE FYE :31ST Mar Debt and Cash Availability (USD Million) Industry: Dairy HEADQUARTERS / 180.92 175.65 Address Kwality Ltd. 4.76 2.12 Kwality House F-82, Shivaji Place, Rajouri Garden 2014-15 2013-14 New Delhi - 110027 Debt Cash & Cash Equivalents Tel . 011 47006500 (100 lines) Source: Annual Report Email. [email protected] Note : Debt Includes Short & Long term Borrowings Volume
BUSINESS OVERVIEW • Incorporated in 1992 as Kwality Dairy India Ltd., the company was set up as backward integration unit of Kwality Ice Creams India Ltd. • The company was acquired by Dhingra Family in 2002. • The company has various milk processing plants located at Palwal (Haryana), Bulandsahar (UP), Saharanpur (UP), Jarar (UP), Sitapur (UP), and Ajmer (Rajasthan), which are capable of handling approximately 3 million liters of milk per day. • For direct collection of milk from milk producers, the company has milk chilling centers situated across Rajasthan, UP, Punjab, and Haryana. • Company is planning to launch new products catering to the increasing health awareness among the consumers.
( B S E : 5 3 1 8 8 2 , N S E : K WA L I T Y )
Share Price (INR)
Kw a l i t y L i m i t e d
120 © TechSci Research
Kw a l i t y L i m i t e d ( B S E : 5 3 1 8 8 2 ) Operating History
The company secured rights from its founding father P L Lamba to use the 'Kwality' artwork for its dairy products and beverages. Kwality was selling its dairy products under the brand name 'Dairy Best'.
2015
2014
2013
The company entered into an agreement with Central bank of India to provide financial assistance to dairy farmers in producing quality milk.
The company has changed from Kwality Dairy (India) Limited to Kwality Limited
121 Source: Company Website & Annual Reports
© TechSci Research
Pa r a s D a i r y BUSINESS OVERVIEW
Other Relevant Information
• Headquartered in Delhi, Paras was established
• The company’s first unit was established
in April 1986 as Ved Ram & Sons • The company is engaged in manufacturing and exporting dairy products • It produces milk, dahi, paneer etc. with cow ghee being the latest addition to its portfolio The company operates across North America, South America, Eastern Europe, Southeast Asia, Africa, Middle East The company has 5 manufacturing units located at Malanpur, MP Gulaothi, UP Sandila, UP Sahibabad, UP It uses three different strategies for procuring milk - Franchise, Supplier and VLC System which involves use of Automatic milk collection Unit. The company sells its products in 16 states in India and in more than 25 countries around the world.
• •
• • •
• Certifications • ISO 9001 • Halal assured • HAC Certified • Agmark Certified • Apedia Certified • Kosher foods Certification • 2-STAR-EXPORT Certification from Government of India
• •
in 1987 under the name VRS Foods Limited The company sells approximately 2, 50,000 liters of milk per day In Delhi It covers 5,000 villages across Western UP, Haryana, Rajasthan, Maharashtra and Gujarat for collecting milk 154,000 villagers directly. September 2015: Paras launched a new exclusive milk outlet in Masuri Dasna Ghaziabad and Vaishali July 2014: The company added cow ghee to its portfolio. The company’s modern dairy ingredient plants is operating in technical collaboration with Westfalia Separator, A.G. , Filtration Engineering Inc., US and Applexion, Major exports are shipped to USA, , Egypt, Jordan, Libya, Ivory Coast, Afghanistan, Bangladesh, UAE and Pakistan. The company has a 6% market share in the city of Lucknow and 4% in Delhi. August 2013: The company launched seven color packaging for its milk variants to boost its sales
KEY PRODUCTS • Milk • UHT Milk • Flavored Milk • Dahi • Paneer • Ghee • Dairy Whitener RECENT DEVELOPMENTS • March 2012: Paras, invested D4.3 million in its dairy processing unit at Hardoi district in central Uttar Pradesh with a capacity of processing 3.5 lakh litres of milk/day
• 2011 : The company opened 14
new automatic Milk Procurement Centers in to cover 4400 villages
Key Person • Praduman Mahajan, Area Sales Manager • Email: praduman.mahajan@parasdairy .com Key Personnel • Rajendra Singh (Managing Director) HEADQUARTERS / Address D-55, Basement, East of Kailash New Delhi-110065 Ph :- 011 - 26427481-82, 011 - 40591303-04
122 © TechSci Research
Pa r a g M i l k Fo o d s L i m i t e d BUSINESS OVERVIEW Founded in 1992, Parag milk foods limited in headquartered in Mumbai, India • The company has Milk, Cheese Processing Unit and Dairy Farm in Manchar. Another Milk Processing Unit, Palamner with a capacity of around 1,000,000 liters per day. • It nurtures about 2,000 Holstein cows which are the world’s finest breed. • The company operates with four different brands - Gowardhan, Pride of cows, Topp up and GO. • The product portfolio includes ghee, milk, dahi, gulab jamun mix and paneer. • It has 14 depots and 103 super stockists, caters to over 3,000 distributors • The company has round 1600 employees. • Parag currently exports to over 37 countries across the globe. Future Expansion Plans • After launch of two variants of “Go Almette” cheese in Nov’15, company, in near future, is planning to increase its focus towards health and nutrition products to suit Indian taste preferences. •
Recent Developments • May 2015: Russia's Federal Inspection Agency Rosselkhoznadzor inspected the facilities of the company and allowed import of dairy products from their facilities to Russia. • April 2015: The company started producing whey a by-product of the cheese, it’s the first large dairy company in India to begin making whey powder
Recent Developments • November 2015: The company partnered with German cheese maker Hochland to import and market latter's cream cheese in India under a cobranding strategy. • October 2015: Parag Milk Foods entered fresh cream market with Go brand • March 2013: The company invested USD12 million in its plant at Palamaner in Chittoor district of Andhra Pradesh for manufacturing and processing value-added products. • June 2015: The company introduced Go butter milk in a strategic move to expand it portfolio. • April 2015: Parag Milk Foods launched Whey Products. • February 2015: The company announced to launch ghee in Uttar Pradesh as a part of its expansion strategy. • May 2013: International Finance Corporation (IFC) invested USD17 million in Parag Milk Foods Pvt Ltd for expanding milk processing projects at Manchar in Maharashtra and Palamaner in Andhra Pradesh. • September 2012: IDFC Alternatives invested USD27 million in Parag Milk Foods.
KEY PRODUCTS • Pure Milk • Ghee • Butter • Curd • Flavored Milk • Paneer • Dahi • Milk powder • Cheese • Yoghurt • Cream • Butter milk
Certifications • ISO 9000 • AGMARK
Key Person • Shirish Upadhyay(Sr. Vice President) • Ajay Singh Bhadoria(VP Sales) Email: [email protected] Key Personnel • Mr. Devendra Shah (Founder) • Mr. Pritam Shah (Managing Director) HEADQUARTERS / Address 20th Floor Nirmal Building, Nariman Point, Mumbai-400021. T- 022-43005555 Fax- 022-43005580
123 © TechSci Research
S t ra te g i c Re c o m m e n d a t i o n s Market Intelligence . Consulting
C o n c e n t r a t e o n Va l u e A d d e d D a i r y P r o d u c t s Change in customer’s consumption patterns, shifting consumer preferences towards value added dairy products (VADPs) such as butter, cheese, ice cream, etc., coupled with rising disposable income, etc. are few of the factors driving the demand for Value added dairy products in India. VADPs are high quality products which are priced
reasonably and are available at very convenient locations for customers to purchase. Price margins in drinking milk segment stood at around 4% – 5% whereas for VADPs it ranged from 12% – 18%. Product innovations in VADPs, such as low fat cheese, sugar free ice creams, flavored yogurts, etc., are likely to drive the demand for these products in India during the forecast period. Companies are, therefore, recommended to incline
more investments towards value added dairy products in order to capitalise on margins and volumes.
125 © TechSci Research
Fo c u s o n Ru ra l A re a s With increasing disposable income levels of consumers in rural areas, there is a huge potential for dairy products, as there are only a few major organized players operating in rural regions of the country. Consumers in rural areas are in need of quality packaged products, presents
which
ensures
organized
hygiene
players
with
and an
safety.
This
opportunity
to
strengthen their position in the market. Manufacturers can establish dairy plants in rural areas, given the low establishment and procurement costs. This is expected to ensure low operational costs and high quality of dairy products. Additionally, hygiene and quality of dairy products can be ensured right at the procurement level. Companies are therefore recommended to establish themselves in these parts of the country in order to strengthen their market presence.
126 © TechSci Research
Fo c u s o n Pa c k a g e d P ro d u c t s
India dairy products market is dominated by the unorganized sector and does not follow any fixed packaging regulations. Demand for packaged dairy products such as butter and ghee, is increasing on of rising customer awareness. This is anticipated to drive demand for packaged dairy products that ensure hygiene. Dairy
product
recommended
to
manufacturers focus
on
are
thus
providing
proper
packaging of products, which ensures product longevity to increase product quality. Rising incorporation of reusable packages for products such as butter, ghee, cheese, etc., which can be stored for longer periods is attracting consumers.
127 © TechSci Research
Fo c u s o n I m p rov i n g S u p p ly C h a i n M a n a g e m e n t The supply chain of dairy products in India needs significant improvements. Lack of proper cold chain facilities in the country has resulted in large portion
of
dairy
products
being
disposed
off
unused. Strengthening of supply chain is forecast to ensure
less wastage of dairy products. In India, the transportation system needs improvements. Cold chain infrastructure is not available in the rural areas and this leads to complications in transporting dairy products. Improvements in cold storage facilities in the country is projected to reduce wastage and enhance productivity of the manufacturers. Companies are thereby recommended to improve
their supply chain structure to reduce product loss during transportation.
128 © TechSci Research
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Related Reports India Food Additives Market Forecast and Opportunities, 2020 United States Organic Foods Market Forecast and Opportunities, 2020 Global Cold Chain Market Forecast and Opportunities, 2020
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129 © TechSci Research
Ta b l e o f C o n t e n t s S. No.
Contents
Page No.
1.
Research Methodology
2.
Analyst View
10
3.
Product Overview
12
4.
Global Dairy Products Market Overview
14
5.
India Dairy Products Market Outlook
16
5.1.
Market Size & Forecast
5.1.1. 5.2.
5.3. 6.
6.2. 7.
By Value
5.2.1.
By Type (Drinking Milk, Ghee, Butter, Ice Cream, Milk Powder, Cheese, Yogurts, Probiotic Drinks & Others)
20
5.2.2.
By Region
22
5.2.3.
By Company
27
5.2.4.
By Organized Vs Unorganized
31
Market Attractiveness Index
32 34
Market Size & Forecast 6.1.1.
By Value
35
6.1.2
By Volume
36
Pricing Analysis
India Ghee Market Outlook 7.1.
19
Market Share & Forecast
India Drinking Milk Market Outlook 6.1.
8
39 41
Market Size & Forecast 7.1.1.
By Value
42
7.1.2
By Volume
43
2 © TechSci Research
Ta b l e o f C o n t e n t s S. No.
Contents 7.2.
8.
Pricing Analysis
44
India Butter Market Outlook
46
8.1.
8.2. 9.
9.2.
8.1.1.
By Value
47
8.2.2.
By Volume
48
Pricing Analysis
10.2.
11.2.
51
9.1.1.
By Value
52
9.1.2.
By Volume
53
Pricing Analysis
54 56
Market Size & Forecast 10.1.1.
By Value
57
10.1.2.
By Volume
58
Pricing Analysis
India Cheese Market Outlook 11.1.
49
Market Size & Forecast
India Milk Powder Market Outlook 10.1.
11.
Market Size & Forecast
India Ice Cream Market Outlook 9.1.
10.
Page No.
59 61
Market Size & Forecast 11.1.1.
By Value
62
11.1.2.
By Volume
63
Pricing Analysis
64
3 © TechSci Research
Ta b l e o f C o n t e n t s S. No. 12.
Contents India Yogurts Market Outlook 12.1.
12.2. 13.
13.2. 14.
66
Market Size & Forecast 12.1.1.
By Value
67
12.1.2.
By Volume
68
Pricing Analysis
India Probiotic Drinks Market Outlook 13.1.
Page No.
69 71
Market Size & Forecast 13.1.1.
By Value
72
13.1.2.
By Volume
73
Pricing Analysis
India Other Dairy Products Market Outlook 14.1.
Market Size & Forecast
14.1.1.
By Value
74 76
77
15.
Import-Export Analysis
78
16.
Supply Chain Analysis
83
17.
Market Dynamics
86
17.1.
Drivers
88
17.2.
Challenges
91
18.
Trends & Developments
94
18.1.
Implementation of Favorable Government Initiatives
96
18.2.
Adoption of Automation by Private Players
97
18.3.
Rising Demand for Yogurt and Western Dairy Products
98
4 © TechSci Research
Ta b l e o f C o n t e n t s S. No.
Contents 18.4.
Steady Rise in Demand for Organic Milk
18.5.
Increasing Demand For Packaged Products
Page No. 99 100
19.
Policy & Regulatory Landscape
101
20.
India Economic Profile
105
21.
Competitive Landscape
108
21.1.
Gujarat Cooperative Milk Marketing Federation Ltd
109
21.2.
National Dairy Development Board
110
21.3.
Karnataka Cooperative Milk Producers Federation Ltd
111
21.4.
Tamil Nadu Co-operative Milk Producers' Federation Limited
112
21.5.
Andhra Pradesh Dairy Development Cooperative Federation Ltd
113
21.6.
Heritage Foods Ltd
114
21.7.
Hatsun Agro Products Ltd
116
21.8.
Kwality Limited
118
21.9.
Paras Dairy
120
21.10.
Parag Milk Foods Limited
121
22.
Strategic Recommendations
122
23.
& Disclaimer
127
5 © TechSci Research
List of Figures Figure No.
Title
Page No.
Figure 1:
Top 5 Milk Producing Countries, By Volume, 2014 (Million Tons)
15
Figure 2:
India Milk Consumption Share, By Cattle Type, By Volume, 2014
17
Figure 3:
India Dairy Products Market Size, By Value, 2011-2021F (USD Billion)
19
Figure 4:
India Dairy Products Market Share, By Type, By Value, 2011 – 2021F
20
Figure 5:
India Dairy Products Market Share, By Region, By Value, 2015 & 2021F
22
Figure 6:
India Dairy Products Market Share, By Region, By Value, 2011 – 2021F
24
Figure 7:
India Dairy Products Market Share, By Company, By Value, 2011 – 2021F
27
Figure 8:
India Dairy Products Market Share, By Organized vs Unorganized, By Value, 2015
31
Figure 9:
India Dairy Products Market Share, By Organized vs Unorganized, By Value, 2021F
31
Figure 10:
India Dairy Products Market Attractiveness Index, By Type, By Value, 2015-2021F
33
Figure 11:
India Drinking Milk Market Size, By Value, 2011-2021F (USD Billion)
35
Figure 12:
India Drinking Milk Market Size, By Volume, 2011-2021F (Billion Litres)
36
Figure 13:
India Drinking Milk Average Selling Price, 2011-2021F (USD per Litre)
39
Figure 14:
India Ghee Market Size, By Value, 2011-2021F (USD Billion)
42
Figure 15:
India Ghee Market Size, By Volume, 2011-2021F (Billion Kilograms)
43
Figure 16:
India Ghee Average Selling Price, 2011-2021F (USD per Kilogram)
44
Figure 17:
India Butter Market Size, By Value, 2011-2021F (USD Billion)
47
Figure 18:
India Butter Market Size, By Volume, 2011-2021F (Billion Kilograms)
48
Figure 19:
India Butter Average Selling Price, 2011-2021F (USD per Kilogram)
49
Figure 20:
India Ice Cream Market Size, By Value, 2011-2021F (USD Billion)
52
Figure 21:
India Ice Cream Market Size, By Volume, 2011-2021F (Billion Litres)
53
Figure 22:
India Ice Cream Average Selling Price, 2011-2021F (USD per Liter)
54
Figure 23:
India Milk Powder Market Size, By Value, 2011-2021F (USD Billion)
57
Figure 24:
India Milk Powder Market Size, By Volume, 2011-2021F (Billion Kilograms)
58
Figure 25:
India Milk Powder Average Selling Price, 2011-2021F (USD per Kilogram)
59
Figure 26:
India Cheese Market Size, By Value, 2011-2021F (USD Billion)
62
Figure 27:
India Cheese Market Size, By Volume, 2011-2021F (Billion Kilograms)
63
6 © TechSci Research
List of Figures Figure No.
Title
Page No.
Figure 28:
India Cheese Average Selling Price, 2011-2021F (USD per Kilogram)
64
Figure 29:
India Yogurts Market Size, By Value, 2011-2021F (USD Billion)
67
Figure 30:
India Yogurts Market Size, By Volume, 2011-2021F (Billion Liters)
68
Figure 31:
India Yogurt Average Selling Price, 2011-2021F (USD per Liter)
69
Figure 32:
India Probiotic Drinks Market Size, By Value, 2011-2021F (USD Billion)
72
Figure 33:
India Probiotic Drinks Market Size, By Volume, 2011-2021F (Billion Kilogram)
73
Figure 34:
India Probiotic Drinks Average Selling Price, 2011-2021F (USD per Liter)
74
Figure 35:
India Other Dairy Products Market Size, By Value, 2011-2021F (USD Billion)
77
Figure 36:
India Dairy Product Exports to Top 5 Countries, By Value, 2013-2014 & 2014-2015 (USD Million)
80
Figure 37:
India Disposable Personal Income, 2011 – 2015 (USD Billion)
91
Figure 38:
India Year on Year Growth Comparasion for Value Added Dairy Products and Non Value Added Dairy Products 2012-2021F
92
Figure 39:
India Demand & Availability of Feed and Fodder, 2014 (Million Tonnes)
94
Figure 40:
India Year on Year Growth Comparasion for Indigenous Dairy Products and Western Dairy Products 2012-2021F
100
L i s t o f Ta b l e s Table No.
Title
Page No.
Table 1:
India Dairy Products Market Share, By State, By Value, 2011 & 2015
23
Table 2:
India State wise Milk Production, 2010-11-2014-15 (Thousand Tonnes)
37
Table 3:
India Dairy Product Imports, By Value (USD Million), By Volume (Thousand Tonnes), 2011-2015
81
Table 4:
India Dairy Product Exports, By Value (USD Million), By Volume (Thousand Tonnes), 2011-2015
82
Table 5:
India Dairy Products Import Duty Structure, 2015
106
7 © TechSci Research
Research Methodology Market Intelligence . Consulting
Research Methodology Baseline Methodology Our dedicated team of industry experts has comprehensively monitored and analyzed various aspects of India dairy products market. The team has analyzed various industry segments and speculated a positive future of the industry. Taking into consideration growth in disposable income, rising demand for value added dairy products (VADP), increasing working population, especially women, changing food consumption pattern, retail and supermarkets/hypermarkets, etc., our team of analysts has provided an in-depth analysis of the industry’s performance in the future. This would enable our clients in planning their investment decisions and explore growth opportunities in the India dairy products market. For our study, we have gathered information through primary research surveys with manufacturers and suppliers of dairy products in India, followed by an exhaustive secondary research from credible paid databases.
Our team of experts has then prudently evaluated all collected information and organized the same in chronological order to depict a meaningful and clear picture of the dairy products market in India. In addition, while compiling the data, we have also validated all the collected information from multiple sources and data warehouses in order to present the most accurate and precise information of the concerned industry. We have also identified and analyzed all emerging trends, including important drivers and challenges that the industry is confronting. We have also presented various forecasts for the industry based on our in-depth analysis of market dynamics, prevalent trends, major developments and growth opportunities. Companies Interviewed
NDDB, Amul, Heritage Foods, GopalJee Dairy, Paras Dairy, Gujarat Cooperative Milk Marketing Federation Limited, Schreiber Dynamix Dairy
Secondary Sources : Annual Reports, Press Releases, Government Statistics, etc.
9 © TechSci Research
A n a lys t Vi ew
Analyst View India Dairy Products Market to Grow at a CAGR of over 7% during 2016-2021
India dairy products market is projected to reach USD133 billion by 2021 from USD89.9 billion in 2015, ing a CAGR of over 7% during 2016-2021. Increasing health consciousness among consumers, rising disposable income levels, etc., are driving growth in India dairy products market. Demand for dairy products in India is being driven by increasing malnutrition and other calcium related deficiencies in rural areas, and introduction of value added dairy products and changing consumption patterns in urban areas. Drinking Milk to Dominate India Dairy Products Market
Drinking milk dominated India dairy products market in 2015 and the trend is anticipated to continue through 2021. Drinking milk market in India is projected to grow at a CAGR of over 9%, in value , during 2016-2021, due to growing domestic and international demand. Drinking milk segment garnered a revenue share of over 36% in India dairy products market in 2015 and this is projected to reach 40.55% by 2021. Rising Consumption of Value Added Dairy Products Consumption pattern demonstrates growth in demand of value added dairy products such as ghee, cheese, butter, etc. This changing consumption patterns of consumers in India can be attributed to changing food habits and rising disposable income levels. Rising Share of Organized Sector in India Dairy Products Market Indian dairy products market is expected to witness a shift from unorganized to organized sector. The share of organized market, which stood at 30% in Indian dairy products market in 2015, and is projected to reach 42% by 2021. Rising share of organized sector in India dairy products market can be attributed to rising demand for high quality packaged products, especially in urban areas. However, in rural areas, acceptance of packaged dairy products is slowly gaining momentum.
11 © TechSci Research
Product Overview Leading Dairy Products in India
•
Drinking Milk
Dairy products can be defined as products produced from milk, sourced from cows, buffaloes, goats,
sheep,
Milk Powder
yaks, horses,
camels and other mammals.
producer of milk in the world, suring European Union.
•
Cheese
In 2014, India was declared as the largest
Increasing production of dairy products, rising purchasing power of consumers, changing
preferences
and
growing
Dairy Products
•
Ice Cream
Butter
Probiotic Drinks
demand for value added dairy products are anticipated to fuel growth in India
Ghee
dairy products market. Yogurts
12 © TechSci Research
Product Overview
The dairy products are majorly categorized
Raw Milk
into drinking milk and value added dairy products (VADP). Traditional
Drinking Milk
VADP
includes
ghee,
khoya,
mishti dahi, matta, etc., and non-traditional products
or
western
products
such
as
butter, cream, cheese, etc. In India, demand for traditional VADP is
Value Added Products
higher than non-traditional VADP. This is evident from the fact that the utilization of
milk
Non Traditional VADP
for
production
of
western
dairy
products is only 5% of the total raw milk
Traditional VADP
produced.
13 © TechSci Research
G l o b a l D a i r y P ro d u c t s M a r ke t O ve r v i ew
Global Dairy Products Market Overview Growing inclination towards healthy living, improving standards of living in developing countries and increasing exports from Asia and Africa to the European Union is projected to drive growth in global dairy products market in the coming years. Since 1982, global milk production increased by more than 50% and as of 2014, India is the leading producer of milk in the world. Rising awareness about the benefits of consuming pasteurized milk over raw milk and changing consumer buying behavior are driving growth in the global dairy products market. Moreover, growing popularity of low fat dairy products is generating demand for these products from various population segments, and opening new avenues for companies in this segment. Changing consumers buying behavior has accelerated growth of value added dairy products such as cheese, butter, butter milk, low fat yogurt, flavored milk, probiotic drinks, etc. These products have become a part of regular consumption due to convenience and health benefits. As of 2015, India still is the world’s largest milk producer and ed for a 16% share in the global production, followed by the US, China, Pakistan and Brazil. In the last few years, prices of dairy products across the global market have been declining due to substantial increase in dairy production. Figure 1: Top 5 Milk Producing Countries, By Volume, 2014 (Million Tons) 150.39
146.33 93.64 49.28
35.02
34.07
15 European Union
India
United States
China
Pakistan
Russia Source: TechSci Research
© TechSci Research
I n d i a D a i r y P ro d u c t s M a r ke t O u t l o o k
India Milk Consumption Share, By Cattle Type Consumption of milk in India is dominated by buffalo milk, mainly due to its high fat content. The cholesterol content of buffalo milk is 0.65 mg/g as compared to 3.14 mg/g for cow milk. Additionally, the Protein Efficiency Ratio (PER) of buffalo milk proteins is 2.74 as compared to 2.49 of cow milk. Buffalo milk has about 11.42% higher protein than cow milk. Commercially, it is more feasible to use buffalo milk for manufacturing fat-based and non fat-based milk products such as butter, ghee, milk powders, etc., due to its lower water content and high fat content.
Most of the farms in India depend on buffalo milk for dairy products production and India s for about twothirds of the world's buffalo milk production. Cow milk ed for a share of 45% in total milk consumption in India in 2014. However, goat milk ed for a share of 4% in the total milk consumption in India, in 2014.
Figure 2: India Milk Consumption Share, By Cattle Type, By Volume, 2014
Goat Milk 3.77 Buffalo Milk 51.17
Cow Milk 45.06
17 Source: DAHD © TechSci Research
India Dairy Products Market Outlook
With approximately 75 million dairy farms around the country, India is the largest producer of milk and produced around 52.39 billion liters of milk in 2015.
The milk processed by the organized sector in around 1,400 dairy processing plants, with an installed capacity of almost 135 million liters per day.
The dairy industry employees around 90 million people and approximately 75 million of these are women.
Growing awareness regrading milk quality and changing lifestyles is propelling growth in the demand for packaged products. Rapidly changing lifestyles influenced younger generations to adapt to newer products such as yogurts, probiotic drinks, etc.
An average Indian household spends USD10 to USD25 in a month on dairy products.
18 © TechSci Research
India Dairy Products Market Size Figure 3: India Dairy Products Market Size, By Value, 2011-2021F (USD Billion) CAGR 2016E-2021F By Value: 7.01%
CAGR 2011-2015 By Value: 4.89%
74.20
77.40
80.90
84.90
89.80
94.98
2011
2012
2013
2014
2015
2016E
100.88
2017F
107.46
2018F
114.89
2019F
123.40
2020F
133.25
2021F
Source: TechSci Research
Dairy products market in India grew at a CAGR of 4.89%, in value , during 2011-2015 and was valued at USD89.80 billion in 2015. This is forecast to reach USD133.25 billion by 2021, exhibiting a CAGR of over 7%, in value , during 2016-2021. Dairy products market in India is witnessing a tremendous change, due to increasing emphasis on nutritional value of dairy products. Introduction of value added dairy products, changing consumption patterns, growing penetration of international players, etc. are fueling growth of dairy products market in India. Unorganized dairy products sector garnered a majority share in India dairy products market in 2015, and this is projected to decline in the next 5 years. Value added dairy products, changing consumer preference for law fat dairy
19
products, increasing per capita spending, etc., are fueling growth of the organized sector in India dairy products market. © TechSci Research
India Dairy Products Market Share, By Type Figure 4: India Dairy Products Market Share, By Type, By Value, 2011-2021F
36.22%
36.34%
36.52%
36.69%
36.58%
36.69%
36.90%
37.34%
38.03%
26.66%
26.81%
26.65%
26.46%
26.90%
27.06%
27.10%
26.85%
26.26%
28.01%
27.58%
27.34%
27.08%
26.45%
6.49%
6.49%
6.83%
6.70%
6.60%
6.53%
25.84%
25.27%
25.23%
24.64%
24.06%
6.96%
7.09%
7.23%
7.38%
2.15%
2.36%
1.25%
1.23%
1.23%
1.29%
1.37%
1.46%
1.56%
1.68%
1.81%
1.96%
1.05%
1.10%
1.16%
1.22%
1.25%
1.26%
1.27%
1.26%
40.55%
39.07%
23.75% 22.86%
23.47%
7.54%
2.62%
1.19%
0.77% 0.60%
0.24% 0.09%
0.13%
0.10%
0.03% 2011 Drinking Milk
0.29%
0.27%
0.25%
0.03% 2012 Ghee
0.03% 2013 Others
0.20%
0.16% 0.03% 2014
0.35%
0.32%
0.04% 2015 Butter
Others: Curd, Paneer, Cream Flavored milk, Soy milk, Dairy whiteners
0.25%
0.39%
0.49%
0.66% 0.57%
0.47%
0.04%
0.30% 0.04%
2016
2017
Ice Cream
0.44%
Milk Powder
0.38%
0.05%
0.05%
0.06%
0.06%
2018
2019
2020
2021
Cheese
Yogurts
20
Probiotic Drinks Source: TechSci Research
© TechSci Research
India Dairy Products Market Share, By Type
Drinking milk ed for a revenue share of 36.58% in India dairy products market in 2015 and this is projected to reach 40.55% by 2021. Ghee ed for a revenue share of 26.45% in India dairy products market in 2015. With changing preference of consumers, the market share of value added dairy products such as butter, cheese, etc., is anticipated to grow during the forecast period.
Butter is projected to for a revenue share of over 7% in India dairy products market by 2021. Introduction of low fat products, rising health awareness, etc., are anticipated to fuel growth in India value added dairy products market.
Rising health concerns and growing penetration of international players is anticipated to fuel demand for probiotic drinks. Increasing disposable income levels, changing consumption patterns, entry of international brands, etc., are driving demand for yogurts and ice creams in India.
21 © TechSci Research
India Dairy Products Market Share, By Region Figure 5: India Dairy Products Market Share, By Region, By Value, 2015 & 2021F
North
East
2015: 34.96% 2021F: 32.48%
2015: 11.92% 2021F: 12.29%
West
South
2015: 31.77% 2021F: 32.11%
2015: 21.35% 2021F: 23.12%
Source: TechSci Research
22 © TechSci Research
India Dairy Products Market Share, By Region Table 1: India Dairy Products Market Share, By State, By Value, 2011 & 2015 State
2011
2012
2013
2014
2015
Uttar Pradesh
17.26%
17.64%
17.62%
17.57%
17.73%
Rajasthan
10.86%
10.56%
10.53%
10.58%
11.92%
Andhra Pradesh
9.19%
9.45%
9.64%
9.45%
6.80%
Gujarat
7.65%
7.68%
7.79%
8.07%
8.23%
Punjab
7.73%
7.47%
7.34%
7.27%
7.28%
Madhya Pradesh
6.17%
6.37%
6.67%
6.97%
7.59%
Maharashtra
6.60%
6.62%
6.60%
6.60%
6.71%
Haryana
5.14%
5.21%
5.32%
5.41%
5.56%
Bihar
5.35%
5.19%
5.17%
5.23%
5.47%
Tamil Nadu
5.61%
5.45%
5.29%
5.12%
5.02%
Karnataka
4.20%
4.26%
4.32%
4.36%
4.31%
West Bengal
3.67%
3.65%
3.67%
3.56%
3.49%
Kerala
2.17%
2.12%
2.11%
1.93%
1.91%
Odisha
1.37%
1.35%
1.30%
1.35%
1.34%
Jharkhand
1.28%
1.36%
1.27%
1.23%
1.22%
Others
5.75%
5.62%
5.38%
5.30%
5.43%
23
Source: TechSci Research © TechSci Research
India Dairy Products Market Share, By Region Figure 6: India Dairy Products Market Share, By Region, By Value, 2011 & 2021F
35.22%
35.36%
35.01%
34.98%
34.96%
34.53%
34.11%
33.70%
33.29%
32.88%
32.48%
31.32%
31.68%
31.72%
31.77%
31.85%
31.92%
31.98%
32.03%
32.08%
32.11%
21.31%
21.35%
21.92%
22.22%
22.51%
22.82%
21.20%
21.36%
21.64%
23.12%
21.38%
12.21%
12.01%
11.94%
11.93%
11.92%
11.98%
12.04%
12.10%
12.17%
12.23%
12.29%
2011
2012
2013
2014
2015E
2016F
2017F
2018F
2019F
2020F
2021F
31.37%
North
South
East
24
West Source: TechSci Research
© TechSci Research
India Dairy Products Market Share, By Region North Region North India ed for a market share of 35% in India dairy products market in 2015. Increasing per capita expenditure and rising youth population base, implementation of various government initiatives, improvements in infrastructure, increasing middle class population in Tier II & III cities, etc., fueled consumption of dairy products in the region, during 2011-2015. North India is the largest producer of milk in India. Around 23 MMT of milk was produced in Uttar Pradesh, which is ed for a share of 17% in the country’s total milk production. Bhadawari, an improved buffalo breed, in Agra and Etawah districts of Uttar Pradesh, are known for their high average milk yield of almost 1,300 kg per lactation period, with rich content of 6-13% milk fat in its milk. Farmers from Punjab are using Punjab Holstein, high-performance cross-bred cows that yield up to 10,000 liters of milk in a 10-month lactation period. In 2015, the state had over 25 lakh cross-bred cows, the highest in the country. West Region West region ed for a revenue share of over 31% in India dairy products market in 2015 and this is projected to increase to 32.05% by 2021. Highest number of dairy co-operatives, increasing household income levels coupled with large number of households, are driving growth of the dairy products market in this region. Increasing urbanization, changing consumption patterns from traditional to non-traditional dairy products such as yogurts, cheese, etc., are also propelling growth in the region’s dairy products market. Gujarat, is the leading producer of milk in the region and contributes significantly to the growth of dairy products market in the region. Government is taking measures to improve feeding practices and develop quality feeds and fodders to improve livestock productivity and dairy production
capacity, as a result of which livestock population has increased substantially in Gujarat.
25 © TechSci Research
India Dairy Products Market Share, By Region South Region South India ed for a revenue share of over 21.35% in India dairy products market in 2015 and this is projected to reach 23.12% by 2021. Increasing urbanization, rising working and youth population, and increasing spending power are anticipated to drive the demand for value added dairy products in the region. Andhra Pradesh
ed for the highest milk production in the region due to adequate grazing lands present in the region coupled with favorable weather conditions, an essential requirement for milch animals to give proper yield. East Region East India ed for a revenue share of 11.92% in India dairy products market in 2015. Dairy whitener
products are in huge demand in this region and exhibited a year-on-year growth of 15% in 2015. Various government initiatives and introduction of new policies such as subsidized feed and fodder and 30% subsidy on purchase of animals, etc., is encouraging farmers to produce milk in this region. With increasing demand for value added dairy products, increasing per capita income levels, growing youth population, etc., are major factors driving growth in East India dairy products market. The region revenue share in India dairy products market is projected to reach at 12.29% by 2021.
26 © TechSci Research
India Dairy Products Market Share, By Company Figure 7: India Dairy Products Market Share, By Company, By Value, 2011 – 2021F 43.34%
42.96%
15.46% 11.47% 8.41% 6.57%
2011
40.27%
39.75%
39.22%
38.66%
16.77%
17.05%
17.33%
17.61%
17.90%
18.20%
11.41%
11.34%
11.27%
11.20%
11.13%
11.07%
11.00%
10.93%
10.87%
10.80%
8.57%
8.75%
8.92%
9.10%
9.28%
9.47%
9.66%
9.85%
10.05%
10.25%
3.14%
3.17% 3.09%
3.08%
2.80%
2.84%
2.01%
2.04%
2.87% 2.07% 2.10%
2.00%
2.05% 2012
6.06%
6.23%
5.90%
3.20% 3.10%
2.90%
5.74%
3.23%
5.59%
5.44%
3.27%
3.30%
5.30%
5.16%
5.02%
3.33%
3.37%
3.40% 3.15%
3.11%
3.12%
3.12%
3.13%
3.14%
2.93%
2.97%
3.00% 2.53%
3.03% 2.66%
3.07%
2.20%
2.23%
2.27%
2.30%
2.31% 2.20% 2.10% 2.13%
2.42% 2.16%
2.79%
3.10% 2.92%
2.07%
2.08%
2.10%
2.12%
2.13%
2.15%
2.17%
2.18%
2.20%
2013
2014
2015
2016
2017
2018
2019
2020
2021
Gujarat Co-operative Milk Marketing Federation Ltd National Dairy Development Board Karnataka Cooperative Milk Producers Federation Ltd Others
40.77%
16.50%
1.91%
2.04%
41.24%
16.23%
3.08%
2.77%
41.70%
15.97%
3.10%
3.07%
42.14%
15.71%
6.40%
3.07%
1.98% 1.82%
42.56%
Tamil Nadu Cooperative Milk Producers Federation Ltd Heritage Foods Ltd
Maharashtra Rajya Sahakari Dudh Mahasangh Maryadit Andhra Pradesh Dairy Development Cooperative Federation Ltd Hatsun Agro Products Ltd Rajasthan Co-operative Dairy Federation Ltd
27
Bihar State Co-operative Milk Producers Federation Ltd
Others include Paras Dairy, Kwality Ltd, Parag, Milky Mist, Britannia, Gagan, Vita, Metro Dairy, Fresh'n Natural, Dahi Everyday Milk, DMS, Nestlé, Gagan. Source: TechSci Research
© TechSci Research
India Dairy Products Market Share, By Company India dairy products market is unorganized, with only a few notable players operating in the organized sector.
This trend is expected to change, as a number of private players are entering the market and existing organized market players are expanding operations in the country. Gujarat Co-operative Milk Marketing Federation Limited ed for a market share of 16.50% in India dairy products market in 2015. The company has presence throughout India and its market share in India dairy products market is projected to reach 18.20% by 2021, as the company is expanding its operations across the country. The company is also opening new dairy plants in Uttar Pradesh in order to address the growing demand in the region. Mother Dairy, which operates under National Dairy Development Board, ed for a market share of 11.20% in India dairy products market in 2015. The company’s market share is forecast to decline, due to
emergence of a number of private players in India dairy products market. These new companies are offering a wide range of attractively packaged products for consumers. Karnataka Cooperative Milk Producers Federation Limited, which operates under the brand Nandini garnered a market share of 9.10% in India dairy products market in 2015 and the company’s share is projected to reach 10.25% by 2021. The company with its aggressive expansion strategies entered Hyderabad and is offering tough competition to the existing local brands.
28 © TechSci Research
India Dairy Products Market Share, By Company Tamil Nadu Cooperative Milk Producers Federation Limited, operates under the brand Aavin, ed for a revenue share of 5.90% in India dairy products market in 2015. Entry of new players and changing consumer preferences towards non-traditional dairy products is anticipated to result in a decline in the company’s market share
to 5.02% in India dairy products market by 2021. Andhra Pradesh Dairy Development Cooperative Federation Ltd., operates under the brand Vijaya and ed for a revenue share of 3.20% in India dairy products market in 2015. The company’s market presence is largely limited to southern region and with many major private players entering the dairy market, the market share is anticipated to reach 3.10% in India dairy products market by 2021. Maharashtra Rajya Sahakari Dudh Mahasangh Maryadit, which operated under the brand Mahanand Dairy garnered a market share of 3.10% in 2015 and this is projected to reach 3.15% by 2021. The company mainly operates in the Maharashtra and has around 7 dairy units in the state. Rajasthan Co-operative Dairy Federation Limited ed for a market of 2.90% in 2015 and is expected to increase to 2.30% by 2021. The company operates under the brand name Saras and has presence in Rajasthan and in Delhi. Bihar State Co-operative Milk Producers Federation Limited ed for a market share of 2.10% in India dairy products market in 2015. The company operates in Bihar under the brand name Sudha and has around six
district level Milk Producers' Cooperative Unions, covering 31 districts.
29 © TechSci Research
India Dairy Products Market Share, By Company A large number of small players are setting up plants to enhance regional presence. The government is also providing various schemes and encouraging private players to establish their operations and introduce various polices to attract small scale industries. Heritage Foods Limited, based in Hyderabad, is a private player in India dairy products market and ed for a market share of 2.20% in India dairy products market in 2015 and this is projected to increase to 3.40% by 2021. The company, with its strategic expansion strategies to expand to National Capital Region (NCR), Mumbai and Pune. The company is also investing in retail stores across the nation to strengthen its position in the market. Hatsun Agro garnered a market share of 2.10% in India dairy products market in 2015 and is anticipated to reach a market share of 2.92% by 2021. The company has international presence and is also expanding domestically by starting operations in Tamil Nadu. The company also acquired and started a feed mill in Tamil Nadu in 2015. Others: Other players ed for a share of 41.7% in India dairy products market in 2015. These players are mainly small scale players who operate regionally such as Paras Dairy, Kwality Ltd, Parag, Milky Mist, Britannia, Gagan, Vita, Metro Dairy, Fresh'n Natural, Dahi Everyday Milk, DMS, Nestlé, Gagan, etc. The market share of the others segment is projected to reach 38.66% in India dairy products market by 2021.
30 © TechSci Research
India Dairy Market Share, By Market type
Organized sector in India ed for a revenue share of 30% in India dairy products market in 2015. Low share of the organized sector in India dairy products market can be attributed to the late entry of private players in the market and lower penetration of these companies in rural areas. Most players entered India dairy products market post 1991 and established dairy processing facilities. With the implementation of regulatory policies and schemes, the government is encouraging private players to establish dairy plants in India and also allowing foreign players to enter the market. The scenario is expected to change, as farmers are turning towards dairy farming, due to high profitability. Growth of the organized sector in India dairy products market in the coming years can be attributed to rising sales of value added dairy products such as cheese, yogurts, etc., and growing domestic demand for safe, nutritious and health-promoting convenient milk products. Revenue share of organized sector in India dairy products market is projected to reach 42% by 2021.
Figure 8: India Dairy Products Market Share, By
Figure 9: India Dairy Products Market Share, By
Organized vs Unorganized, By Value, 2015
Organized vs Unorganized, By Value, 2021F
Organized Sector, 30%
Organized Sector, 42% Unorganized Sector, 70% Unorganized Sector, 58%
31 Note: The organized sector consists of private companies, co-operatives etc., and un-organized sector consists of dairy farmers, very small scale industries Source: TechSci Research
© TechSci Research
M a r ke t At t ra c t ive n e s s I n d ex
Market Attractiveness Index Figure 10: India Dairy Products Market Attractiveness Index, By Type, By Value, 2015-2021F
40.00% 35.00%
Yogurts
CAGR (2016E-2021F)
30.00% 25.00% Cheese Probiotic Drinks
20.00%
Ice Cream
15.00% 10.00% 5.00%
Milk
Butter
Milk Powder Ghee
-1.00
0.00% 0.00
1.00
2.00
3.00
4.00
5.00
6.00
7.00
-5.00% Absolute Index Low
Medium
High
Note: The size of the bubble corresponds to the market size in 2015
33
Source: TechSci Research © TechSci Research
I n d i a D r i n k i n g M i l k M a r ke t O u t l o o k
I n d i a D r i n k i n g M i l k M a rke t S i z e & Fo re c a s t Figure 11: India Drinking Milk Market Size, By Value, 2011-2021F (USD Billion) CAGR 2016E-2021F By Value: 9.17%
CAGR 2011-2015 By Value: 5.15%
26.88
29.55
32.85
34.85
28.13
31.15
37.23
2011
2012
2013
2014
2015
2016E
2017F
40.12
2018F
43.70
2019F
48.21
2020F
54.03
2021F
Source: TechSci Research
Drinking milk market in India grew at a CAGR of 5.15%, in value , during 2011-2015 and reached USD32.85 billion in 2015. ing a CAGR of 9.17%, in value , during 2016-2021, the market for drinking milk in India is forecast to reach USD54 billion by 2021. Implementation of government policies to increase milk production and exports is propelling growth in India drinking milk market. Launch of new milk variants, entry of international players and increasing demand for packaged drinking milk are anticipated fuel growth in India drinking milk market in the coming years.
35 © TechSci Research
I n d i a D r i n k i n g M i l k M a rke t S i z e & Fo re c a s t Figure 12: India Drinking Milk Market Size, By Volume, 2011-2021F (Billion Liters) CAGR 2016E-2021F By Volume: 7.20%
CAGR 2011-2015 By Volume: 3.16% 46.43
48.66
50.51
52.39
57.38
60.76
46.26
54.65
64.99
2011
2012
2013
2014
2015
2016E
2017F
2018F
2019F
70.37
2020F
77.36
2021F
Source: TechSci Research
Drinking milk market in India grew at a CAGR of 3.16%, in volume , during 2011-2015 and is projected to grow at a CAGR of 7.20% during 2016-2021 Milk consumption in India is projected to reach over 77 billion liters by 2021 as compared to over 52 billion liters in 2015, due to increasing domestic demand, growing health concerns, rising per capita expenditure, increasing urbanization in Tier II & III cities. Competition Outlook: The milk market in the country has largely been dominated by various Co-operative Milk Marketing Federations and societies. These federations have been using a low pricing strategy in order to increase their share coupled with other private players present in the market. Foreign player such as Lactalis and Danone have entered the Indian market and have been engaging in various tie-ups with Indian companies in order to increase their presence in India. In 2014, Lactalis, a based
36
dairy company acquired Tirumala Milk Products to make enter into Indian dairy. © TechSci Research
Milk Production in India Table 2: India State wise Milk Production, 2010-11-2014-15 (Thousand Tonnes) State
2010-11
2011-12
2012-13
2013-14
2014-15
Uttar Pradesh
21,031
22,556
23,330
24,194
25,198.36
Rajasthan
13,234
13,512
13,946
14,573
16,934.31
Andhra Pradesh
11,203
12,088
12,762
13,007
9,656.15
Gujarat
9,321
9,817
10,315
11,112
11,690.57
Punjab
9,423
9,551
9,724
10,011
10,351.41
Madhya Pradesh
7,514
8,149
8,838
9,599
10,779.07
Maharashtra
8,044
8,469
8,734
9,089
9,542.29
Haryana
6,267
6,661
7,040
7,442
7,901.35
Bihar
6,517
6,643
6,845
7,197
7,774.89
Tamil Nadu
6,831
6,968
7,005
7,049
7,132.47
Karnataka
5,114
5,447
5,718
5,997
6,120.93
West Bengal
4,471
4,672
4,859
4,906
4,961
Kerala
2,645
2,716
2,791
2,655
2,711.13
Odisha
1,671
1,721
1,724
1,861
1,903.14
Jharkhand
1,555
1,745
1,679
1,700
1,733.72
Jammu & Kashmir
1,609
1,614
1,631
1,615
1,950.93
Uttarakhand
1,383
1,417
1,478
1,550
1,565.35
Chhattisgarh
1,029
1,119
1,164
1,209
1,231.57
Source: Department of Animal Husbandry
37 © TechSci Research
Milk Production in India Table 2: India State wise Milk Production, 2010-11-2014-15 (Thousand Tonnes) Contd. State
2010-11
2011-12
2012-13
2013-14
2014-15
Himachal Pradesh
1,102
1,120
1,139
1,151
1,172.16
Assam
790
796
800
815
829.47
Delhi
480
502
287
284
280.06
Tripura
104
111
118
130
141.23
Manipur
78
79
80
82
82.17
Meghalaya
79
80
81
82
82.96
Nagaland
76
78
79
81
75.69
Goa
60
60
61
68
66.6
Puducherry
47
45
47
47
47.64
Sikkim
43
45
42
46
49.99
Chandigarh
45
45
44
44
44
Arunachal Pradesh
28
22
23
43
46.07
Mizoram
11
14
14
15
20.49
Andaman & Nicobar
25
26
21
14
15.56
Dadra & Nagar
11
11
11
11
8.52
Lakshadweep
2
2
2
6
4.19
Daman & Diu
1
1
1
1
0.82
Overall
121,844
127,902
132,433
137,686
146,300
Source: Department of Animal Husbandry
38 © TechSci Research
Price Point Analysis
Figure 13: India Drinking Milk Average Selling Price, 2011-2021F (USD per Liter)
0.581
0.606
0.607
2011
2012
2013
0.627
0.638
0.649
0.660
0.672
0.685
0.698
0.617
2014
2015
2016E
2017F
2018F
2019F
2020F
2021F
Source: TechSci Research
Average selling price of drinking milk in India grew at a slow pace, during 2011-2015 and is expected to follow the same trend in the next five years. The ASP of drinking milk in India stood at USD0.62/liter in 2015 and this is forecast to rise to USD0.69/liter by 2021. Increasing consumption of milk in urban and rural areas, due to rising health concerns, increasing share of
organized market, etc., are driving growth in the ASP of drinking milk.
39 © TechSci Research
Competition Outlook
Top States
Gujarat Cooperative Milk Marketing Federation Ltd
Mother Dairy Fruit & Vegetable Pvt Ltd
Karnataka Cooperative Milk Producers Federation Ltd
Tamil Nadu Cooperative Milk Producers Federation Ltd
Andhra Pradesh Dairy Development Cooperative Federation Ltd
Rajasthan Co-operative Dairy Federation Ltd
Uttar Pradesh
Rajasthan
Andhra Pradesh
Gujarat
Punjab
Karnataka
Maharashtra
40 © TechSci Research
I n d i a G h e e M a r ke t O u t l o o k
I n d i a G h e e M a r ke t S i z e & Fo re c a s t Figure 14: India Ghee Market Size, By Value, 2011-2021F (USD Billion) CAGR 2011-2015 By Value: 3.40%
CAGR 2016E-2021F By Value: 4.41%
20.78
22.12
23.75
24.55
25.45
21.35
22.99
26.48
2011
2012
2013
2014
2015
2016E
2017F
2018F
27.64
28.96
30.46
2019F
2020F
2021F
Source: TechSci Research
Ghee ed for a revenue share of 23.75.45% in India dairy products market in 2015. India ghee market grew at a CAGR of 3.4%, in value , during 2011-2015, to reach USD23.80 billion. ing a CAGR of 4.41%, in value , during the forecast period, India ghee market is projected to reach USD30.50 billion by 2021. Penetration of ghee is higher in North and West regions of the country. India ghee market is dominated by unorganized players and the trend is expected to change in the coming five years, due to changing consumers preferences for value added dairy products, increasing concerns about quality, etc.
42 © TechSci Research
I n d i a G h e e M a r ke t S i z e & Fo re c a s t Figure 15: India Ghee Market Size, By Volume, 2011-2021F (Billion Kilograms)
CAGR 2011-2015 By Value: 1.14%
6.30
6.35
2011
2012
6.45
2013
CAGR 2016E-2021F By Value: 1.50 %
6.55
6.59
6.63
6.69
2014
2015
2016E
2017F
6.77
2018F
6.87
2019F
6.99
2020F
7.14
2021F
Source: TechSci Research
Volume market for ghee in India grew at a CAGR of 1.14% through 2011-2015 and is forecast to grow at a CAGR of 1.05% during the forecast period. Sales of ghee, a traditional dairy product in India, is expected to reach 7.14 billion kilograms by 2021 from 6.59 billion kilograms in 2015. Value added dairy products such as butter, cheese, etc., have not been able to penetrate into the rural market, due to low acceptance of these products and rising demand for traditional dairy products such as ghee.
43 © TechSci Research
Price Point Analysis
Figure 16: India Ghee Average Selling Price, 2011-2021F (USD per Kilogram)
3.30
3.36
3.43
3.51
3.61
3.70
2011
2012
2013
2014
2015
2016E
3.81
3.91
4.02
4.14
4.27
2017F
2018F
2019F
2020F
2021F
Source: TechSci Research
Ghee, a traditional dairy product in India, has an average selling price of USD3.61 per kilogram in 2015. The prices of ghee are expected to grow at a steady pace during the forecast period and reach USD4.27 per kilogram by
2021.
A huge demand for ghee is emanating from the rural market. Companies operating in the organized sector are introducing various products with packaging innovations to assure quality.
44 © TechSci Research
Competition Outlook
Top States
Gujarat Cooperative Milk Marketing Federation Ltd
Mother Dairy Fruit & Vegetable Pvt Ltd
Karnataka Cooperative Milk Producers Federation Ltd
Tamil Nadu Cooperative Milk Producers Federation Ltd
Andhra Pradesh Dairy Development Cooperative Federation Ltd
Rajasthan Co-operative Dairy Federation Ltd
Uttar Pradesh
Rajasthan
Andhra Pradesh
Gujarat
Punjab
Karnataka
Maharashtra
45 © TechSci Research
I n d i a B u t te r M a r ke t O u t l o o k
I n d i a B u t te r M a r ke t S i z e & Fo re c a s t Figure 17: India Butter Market Size, By Value, 2011-2021F (USD Billion) CAGR 2011-2015 By Value: 5.76%
4.81
5.02
5.28
2011
2012
2013
CAGR 2016E-2021F By Value: 9.14%
5.60
6.02
6.49
7.02
2014
2015
2016E
2017F
7.62
2018F
8.30
2019F
9.10
2020F
10.05
2021F
Source: TechSci Research
Butter market in India grew at a CAGR of 5.76%, in value , during 2011-2015, and reached USD6 billion in 2015. Butter market in India is further forecast to grow at a CAGR of 9.14%, in value , during 2016-2021 to reach USD10 billion by 2021. In 2015, butter ed for a revenue share of 6.70% in India dairy products market in 2015, and this is projected to reach 7.54% by 2021, on of increasing acceptance of packaged dairy products, rising
penetration of domestic and international players in Tier II & III cities, increasing health awareness among consumers, presence of variety of low fat and low cholesterol butter variants in the market. The organized sector has influenced consumption of butter in the country and demonstrated substantial improvements quality, health benefits, low caloric consumptions.
47 © TechSci Research
I n d i a B u t te r M a r ke t S i z e & Fo re c a s t Figure 18: India Butter Market Size, By Volume, 2011-2021F (Billion Kilograms)
CAGR 2011-2015 By Volume: 2.39 %
CAGR 2016E-2021F By Volume: 4.76%
1.70
1.84
1.55
1.60
1.64
1.91
1.57
1.76
2.00
2011
2012
2013
2014
2015
2016E
2017F
2018F
2019F
2.11
2020F
2.23
2021F
Source: TechSci Research
With changing consumer food consumption patterns, tastes and preferences, butter consumption in India is
anticipated to grow at a CAGR of 4.76%, in volume , during 2016-2021. Butter consumption in India is anticipated to reach 2.23 billion kilograms by 2021 from 1.70 kilograms in 2015. Increasing demand butter in India can be attributed to changing lifestyles of the urban population. Manufacturers are offering innovative products such as low fat butter and producing different varieties such as salted butter, unsalted butter, sweet butter etc.
48 © TechSci Research
Price Point Analysis Figure 19: India Butter Average Selling Price, 2011-2021F (USD per Kilogram)
3.11
3.20
3.30
2011
2012
2013
3.41
3.54
3.68
3.82
3.98
2014
2015
2016E
2017F
2018F
4.14
4.32
4.51
2019F
2020F
2021F
Source: TechSci Research
Butter, a non-traditional dairy product in India, is projected to witness an increase in ASPs over the forecast period. The ASP of butter in India stood at USD3.54 per kilogram in 2015 and this is projected to reach USD4.51 per kilogram by 2021. Growing demand for butter in urban areas, rising availability of number of variants such as low fat and zero cholesterol butter, rising health concerns and growing willingness among consumers to purchase butter is driving ASPs of butter in the country.
49 © TechSci Research
Competition Outlook
Top States
Gujarat Cooperative Milk Marketing Federation Ltd
Mother Dairy Fruit & Vegetable Pvt Ltd
Karnataka Cooperative Milk Producers Federation Ltd
Tamil Nadu Cooperative Milk Producers Federation Ltd
Andhra Pradesh Dairy Development Cooperative Federation Ltd
Rajasthan Co-operative Dairy Federation Ltd
Uttar Pradesh
Rajasthan
Andhra Pradesh
Gujarat
Punjab
Karnataka
Maharashtra
50 © TechSci Research
I n d i a I c e C re a m M a r ke t O u t l o o k
I n d i a I c e C re a m M a r ke t S i z e & Fo re c a s t Figure 20: India Ice Cream Market Size, By Value, 2011-2021F (USD Billion)
CAGR 2011-2015 By Value: 11.37%
CAGR 2016E-2021F By Value: 17.03%
0.91
1.00
1.11
1.24
1.40
2011
2012
2013
2014
2015
1.59
2016E
1.82
2017F
2.11
2018F
3.49 2.92
2.47
2019F
2020F
2021F
Source: TechSci Research
Ice cream market in India is grew at a CAGR of 11.37%, in value , during 2011-2015 and is forecast to grow at a CAGR of over 17% during 2016-2021, to reach USD3.49 billion by 2021 from USD1.40 billion in 2015. Innovations in flavors, expertise to create ice cream for different segment of consumers, entry of number of international players offering a wide range of ice creams such as low-fat ice creams, etc., are fueling growth in ice cream market in India. Consumption of ice cream throughout the year, coupled with improvements in packaging to ensure quality are driving demand for ice cream in India.
52 © TechSci Research
I n d i a I c e C re a m M a r ke t S i z e & Fo re c a s t Figure 21: India Ice Cream Market Size, By Volume, 2011-2021F (Billion Liters) CAGR 2011-2015 By Volume: 3.76%
CAGR 2016E-2021F By Volume: 4.20%
0.40
0.44
0.46
0.38
0.39
0.42
0.48
2011
2012
2013
2014
2015
2016E
2017F
0.50
0.53
0.55
0.56
2018F
2019F
2020F
2021F
Source: TechSci Research
Ice cream market in India grew at a CAGR of 3.76%, in volume during 2011-2015 and is anticipated to grow at a CAGR of 4.20%, during the forecast period. India ice cream market is projected to reach 0.56 billion liters by 2021 from 0.44 billion liters in 2015. Changing consumer preferences and eating habits, entry of a number of players, launch of new flavors, increasing disposable incomes, rising availability of product in the market and increasing preference for consuming products is driving demand for ice creams in India.
53 © TechSci Research
Price Point Analysis Figure 22: India Ice Cream Average Selling Price, 2011-2021F (USD per Liter)
6.19
2.57
2.98
3.20
2.41
2.77
3.46
2011
2012
2013
2014
2015
2016E
3.78
2017F
4.18
2018F
4.69
2019F
5.34
2020F
2021F
Source: TechSci Research
Due to increasing per capita expenditure and shifting consumption trends towards ice creams, the ASP of ice creams in India is projected to increase during 2015-2021, reaching USD6.19/liter by 2021 from USD3/liter in 2015. With international players entering India and offering wide range of flavors that are being accepted by consumers, domestic companies are also investing in the market space, and this has resulted in an increase in the ASP of ice creams in the country. However, penetration of international brands in the ice cream segment is still very low and is limited to urban areas. This offers domestic players with a competitive edge to tap the rural areas and introduce traditional and nontraditional ice cream flavors.
54 © TechSci Research
Competition Outlook
Top States
Vadilal Industries Ltd
Gujarat Cooperative Milk Marketing Federation Ltd
Kwality Limited
Mother Dairy Fruit & Vegetable Pvt. Ltd
Devyani Food Industries Pvt Ltd
Uttar Pradesh
Rajasthan
Andhra Pradesh
Gujarat
Punjab
Karnataka
Maharashtra
55 © TechSci Research
I n d i a M i l k Powd e r M a r ke t O u t l o o k
I n d i a M i l k Powd e r M a rke t S i z e & Fo re c a s t Figure 23: India Milk Powder Market Size, By Value, 2011-2021F (USD Billion) CAGR 2016E-2021F By Value: 5.79%
CAGR 2011-2015 By Value: 9.46%
0.78
0.85
2011
2012
0.94
2013
1.04
2014
1.12
2015
1.20
2016E
1.28
2017F
1.36
2018F
1.44
1.51
2019F
2020F
1.59
2021F
Source: TechSci Research
•
Milk powder is usually used as a substitute for milk and manufacturing value added dairy products such as ice creams, etc. Milk powder market in India stood at USD1.12 billion in 2015, and a CAGR of 9.46%, in
value , during 2011-2015 and this is projected to grow at a CAGR of 5.79%, in value , during 20162021. The milk powder market in India is forecast to be valued at USD1.59 billion by 2021. •
The eastern region which is a milk deficit region mainly is dependent of milk powder and other dairy products such as coffee whiteners as substitute for milk. This gives manufacturers a huge opportunity to capture the untapped market.
57 © TechSci Research
I n d i a M i l k Powd e r M a rke t S i z e & Fo re c a s t Figure 24: India Milk Powder Market Size, By Volume, 2011-2021F (Billion Kilograms)
CAGR 2016E-2021F By Volume: -2.62%
CAGR 2011-2015 By Volume: 4.14% 0.26
0.26
0.26
0.26 0.25
0.24
0.24
0.24
0.24 0.23
0.22
2011
2012
2013
2014
2015
2016E
2017F
2018F
2019F
2020F
2021F
Source: TechSci Research
Milk powder market in India grew at a CAGR of 4.14%, in volume , during 2011-15 and is anticipated to witness a decline at a CAGR of -2.62%, in volume , by 2021. Although, growing demand from the eastern region is offering opportunities to manufacturers to increase profitability. Production of skimmed milk powder is anticipated to decline, as the prices are unstable in the international market. This is due to surplus milk powder being produced after the European Union lifting the quota system for imports.
58 © TechSci Research
Pricing Analysis Figure 25: India Milk Powder Average Selling Price, 2011-2021F (USD per Kilogram)
3.48
3.57
3.84
3.93
2011
2012
2013
2014
4.25
2015
4.60
2016E
4.99
2017F
5.41
2018F
5.87
2019F
6.39
2020F
6.96
2021F
Source: TechSci Research
ASP of milk powder in India have been inconsistent in international market over the last few years due to issues related to over supply. The prices are gaining stability slowly and is expected to grow consistently through the forecast period.
Milk powder prices are projected to increase from USD4.25 per kilogram in 2015 to USD6.96 per kilogram by
2021. The market is gaining stability due to implementation of export regulations.
59 © TechSci Research
Competition Outlook
Top States
Gujarat Cooperative Milk Marketing Federation Ltd
Mother Dairy Fruit & Vegetable Pvt Ltd
Karnataka Cooperative Milk Producers Federation Ltd
Tamil Nadu Cooperative Milk Producers Federation Ltd
Andhra Pradesh Dairy Development Cooperative Federation Ltd
Rajasthan Co-operative Dairy Federation Ltd
Uttar Pradesh
Rajasthan
Andhra Pradesh
Gujarat
Punjab
Karnataka
Maharashtra
60 © TechSci Research
I n d i a C h e e s e M a r ke t O u t l o o k
I n d i a C h e e s e M a r ke t S i z e & Fo re c a s t Figure 26: India Cheese Market Size, By Value, 2011-2021F (USD Billion) CAGR 2016E-2021F By Value: 21.32%
CAGR 2011-2015 By Value: 13.24%
0.17
0.19
0.22
0.25
0.29
0.33
2011
2012
2013
2014
2015
2016E
0.39
2017F
0.47
2018F
0.57
2019F
0.88 0.70
2020F
2021F
Source: TechSci Research
India cheese market was valued at around USD0.29 billion in 2015 and is forecast to reach USD0.88 billion by 2021. Cheese was traditionally not very popular in India, but with changing lifestyles and increasing visibility of
products, demand for cheese in India witnessed growth at a CAGR of 13.24%, in value , during 2011-2015. As cheese market is slowly starting to saturate in the US, Europe etc., India is being seen as potential market by foreign players. India has around 30 popular cheese variants as compared to 3,000 variants available in the global market. Majority of these cheese variants are available only in modern retails.
Dominated by the unorganized market in India, cheese market in India is projected to grow at a CAGR of over 21%, in value , during 2016-2021. The processed cheese market garnered a 45% in the India cheese market, which includes all spreads, cubes, slices, tins, slabs, etc.
62 © TechSci Research
I n d i a C h e e s e M a r ke t S i z e & Fo re c a s t Figure 27: India Cheese Market Size, By Volume, 2011-2021F (Billion Kilograms)
CAGR 2016E-2021F By Volume: 22.54 %
CAGR 2011-2015 By Volume: 15.01 %
0.07 0.06
0.01
0.01
0.02
0.02
0.02
2011
2012
2013
2014
2015
0.03
2016E
0.03
2017F
0.04
2018F
0.05
2019F
2020F
2021F
Source: TechSci Research
Cheese market in India is projected to witness growth at a CAGR of over 22%, in volume , during 20162021 as compared to over 15% during 2011-2015. Demand for cheese is projected to increase, on of rising disposable income, changing food preferences, high urbanization, etc. Cheese is also a major ingredient of western cuisine such as pizzas, pastas, etc. Demand for cheese mostly emanates from urban areas and is expected to reach rural areas due to changing consumer preferences, etc. Total annual consumption of cheese, in volume , is projected to reach 0.07 billion kilograms by 2021 from 0.02 billion kilogram in 2015.
63 © TechSci Research
Price Point Analysis Figure 28: India Cheese Average Selling Price, 2011-2021F (USD per Kilogram)
14.11
2011
13.83
2012
13.62
2013
13.43
2014
13.26
2015
13.10
2016E
12.95
2017F
12.82
2018F
12.69
2019F
12.57
12.46
2020F
2021F
Source: TechSci Research
The prices of cheese varies according to the type, and if it is imported or produced domestically. The average price of cheese in India stood at USD13.26 per kilogram in 2015. The cheese market in India is largely untapped. Rising number of domestic and foreign players entering the market, increasing demand and competition is anticipated to fuel a decline in the prices of cheese in the coming years. The price of cheese in India is anticipated to decline to USD12.46 per kilogram by 2021.
64 © TechSci Research
Competition Outlook
Top States
Gujarat Cooperative Milk Marketing Federation Ltd
Britannia Dairy Pvt Ltd
Mother Dairy Fruit & Vegetable Pvt Ltd
Parag Milk Foods Pvt. Ltd
Milky Mist Dairy
Uttar Pradesh
Rajasthan
Andhra Pradesh
Gujarat
Punjab
Karnataka
Maharashtra
65 © TechSci Research
I n d i a Yo g u r t s M a r ke t O u t l o o k
I n d i a Yo g u r t s M a r k e t S i z e & Fo r e c a s t Figure 29: India Yogurts Market Size, By Value, 2011-2021F (USD Billion)
CAGR 2016E-2021F By Value: 34.32%
CAGR 2011-2015 By Value: 28.91%
1.02 0.74
0.07
0.08
0.10
0.14
2011
2012
2013
2014
0.18
0.23
2015
2016E
0.31
2017F
0.40
2018F
0.54
2019F
2020F
2021F
Source: TechSci Research
India yogurts market grew at a CAGR of 28.91%, in value , during 2011-2015. The market is projected to grow at a CAGR of 34.32%, in value , during 2016-2021. India yogurts market stood at USD0.18 billion and is forecast to reach USD1.02 billion by 2021. Demand for frozen yogurts in India is projected to grow at a faster pace through the forecast period. Easy availability of various functional products, and rising emphasis on low calorie and low fat content of food products is driving the acceptance of yogurts in India. Yogurts are gradually taking over the traditional dairy products in urban and semi urban cities, on of increasing health awareness, better quality of packaged yogurts, rising awareness about products, etc.
67 © TechSci Research
I n d i a Yo g u r t s M a r k e t S i z e & Fo r e c a s t Figure 30: India Yogurts Market Size, By Volume, 2011-2021F (Billion Liters)
CAGR 2016E-2021F By Volume: 25.17%
CAGR 2011-2015 By Volume: 7.88%
0.09 0.07 0.06
0.02
0.02
0.02
0.02
2011
2012
2013
2014
0.02
2015
0.03
2016E
0.04
2017F
0.04
2018F
2019F
2020F
2021F
Source: TechSci Research
Yogurts market in India witnessed growth at a CAGR of 7.88%, in volume , during 2011-2015 and the market is anticipated to grow at a CAGR of over 25% during the forecast period. Entry of private players in the
market and availability of different flavors and low fat products in this segment is driving consumption of yogurts in India from 0.09 billion liters by 2021 from 0.02 billion liters in 2015. Rising awareness about the health benefits of products, increasing disposable income levels, growing demand from middle class segment, affordable prices, etc., are driving demand for yogurts in India.
68 © TechSci Research
Price Point Analysis
Figure 31: India Yogurt Average Selling Price, 2011-2021F (USD per Liter)
3.57
2011
4.63
2012
5.68
2013
6.56
2014
7.28
2015
7.86
2016E
8.47
2017F
9.11
2018F
9.78
2019F
10.47
2020F
11.19
2021F
Source: TechSci Research
The ASP of yogurts n India stood at USD7.28 per liter in 2015 and this is projected to increase to USD11.19 per liter by 2021. The average price of yogurts is anticipated to grow consistently through 2021.
The product is gaining popularity in India due to the entry of a number of organized players in the market. With growing demand and presence of lesser number of companies offering yogurt, the prices of these products are anticipated to grow through 2021.
69 © TechSci Research
Competition Outlook
Top States
Karnataka Cooperative Milk Producers Federation Ltd
Gujarat Cooperative Milk Marketing Federation Ltd
Mother Dairy Fruit & Vegetable Pvt Ltd
Nestlé India Ltd
Tamil Nadu Cooperative Milk Producers Federation Ltd
Uttar Pradesh
Rajasthan
Andhra Pradesh
Gujarat
Punjab
Karnataka
Maharashtra
70 © TechSci Research
I n d i a P ro b i o t i c D r i n k s M a r ke t O u t l o o k
I n d i a P ro b i o t i c D r i n k s M a rke t S i z e & Fo re c a s t Figure 32: India Probiotic Drinks Market Size, By Value, 2011-2021F (USD Billion) CAGR 2016E-2021F By Value: 17.48%
CAGR 2011-2015 By Value: 13.31%
0.085
0.071 0.060
0.020
0.022
0.025
2011
2012
2013
0.029
2014
0.033
2015
0.038
2016E
0.044
2017F
0.051
2018F
2019F
2020F
2021F
Source: TechSci Research
India probiotic drinks market is still in nascent stage, the market is projected to grow at a CAGR of over 17% during the forecast period. Probiotic drinks market in India was valued at USD0.033 billion in 2015 and reach USD0.08 billion by 2021, due growing awareness and products visibility. Growing demand for probiotics drinks can be attributed to rising health issues, increasing consumer awareness, entry of several international and domestic players in the segment and increasing visibility of the product in the market.
72 © TechSci Research
I n d i a P ro b i o t i c D r i n k s M a rke t S i z e & Fo re c a s t
Figure 33: India Probiotic Drinks Market Size, By Volume, 2011-2021F (Billion Kilogram) CAGR 2016E-2021F By Volume: 12.14%
CAGR 2011-2015 By Volume: 10.24 %
0.019
0.007
2011
0.008
2012
0.009
2013
0.010
2014
0.011
2015
0.012
2016E
0.013
2017F
0.015
2018F
0.021
0.016
2019F
2020F
2021F
Source: TechSci Research
Probiotic drinks market in India has very few organized players. Probiotic drinks market in India grew at a CAGR of 10.24%, in volume , during 2011-2015 and is anticipated to grow at a CAGR of 12.14%, in volume , during 2016-2021. The market for probiotic drinks in India is anticipated to grow, due to increasing visibility of the product and rising awareness regarding health benefits of these products.
73 © TechSci Research
Price Point Analysis
Figure 34: India Probiotic Drinks Average Selling Price, 2011-2021F (USD per Liter)
2.77
2.82
2.89
2.98
2011
2012
2013
2014
3.09
3.21
3.35
3.50
3.67
2015
2016E
2017F
2018F
2019F
3.85
2020F
4.06
2021F
Source: TechSci Research
The average selling price of probiotic drinks in India increased during 2011-2015 and is projected to rise at a steady pace through the forecast period. Probiotic drinks in India are being sold at an average price of USD3.09/liter and this is projected to rise to USD4.06/liter by 2021.
Increasing consumption of probiotic drinks in urban areas, growing health concerns, rising disposable income, etc., are driving growth in the ASPs of probiotic drinks in the country.
74 © TechSci Research
Competition Outlook
Top States
Mother Dairy
Gujarat Cooperative Milk Marketing Federation Ltd
Yakult Danone India (P) Ltd.
Nestle India Ltd
Karnataka Cooperative Milk Producers Federation Ltd
Uttar Pradesh
Rajasthan
Andhra Pradesh
Gujarat
Punjab
Karnataka
Maharashtra
75 © TechSci Research
I n d i a O t h e r D a i r y P ro d u c t s M a r ke t O u t l o o k
I n d i a O t h e r D a i r y P ro d u c t s M a r ke t S i z e & Fo re c a s t Figure 35: India Other Dairy Products Market Size, By Value, 2011-2021F (USD Billion)
CAGR 2016E-2021F By Value: 4.25%
CAGR 2011-2015 By Value: 5.13%
19.78
20.75
21.56
2011
2012
2013
22.46
2014
24.16
2015
25.70
2016E
28.85
30.18
31.18
31.65
27.34
2017F
2018F
2019F
2020F
2021F
Others include paneer soy milk kohya and other sweets Source: TechSci Research
Others segment consists of traditional dairy products such as Khoya, etc., and non-traditional dairy products such as sour milk, dairy whiteners, creams, etc. These products are not produced by organized players and the market for other dairy products in India is dominated by unorganized players. The market also includes flavored drinks that are produced locally. Other dairy products market is was valued at USD24.16 billion in 2015, which grew at a CAGR of 5.13%, in value , during 2011-2015. The market is projected to reach USD31.65 billion by 2021, exhibiting a CAGR of 4.25%, in value , during forecast period. Other Dairy Products includes Dairy Whiteners, Cream, Butter Milk, Paneer, Curd, Flavored Milk, Whey Powder, Baby Food, Lactose, Soy Milk, Khoya, Milk-based Sweets, Lassi, Milk Proteins, Acid Casein, Margerines, etc.
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Import-Export Analysis Market Intelligence . Consulting
Import-Export Analysis
Dairy exports from India are not significant due to high in-house consumption. Skimmed milk powder segment is emerging as the largest export segment, after the Indian government lifted bans on exports of skimmed milk powder.
Prices of milk and value added dairy products are lower compared to other exporting nations, due to low labor costs and huge production, resulting in growing demand, especially from the Middle East, Southeast Asia and South Asia. Pakistan, Afghanistan and Bangladesh being the major importers of dairy products from India.
The countries such as Russia, the major importers of dairy products, do not import from India due to quality constraints. Co-operatives and private players are focusing on improving the quality of products. In 2015, Russia is exporting dairy products from India due to increasing demand.
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Import-Export Analysis Figure 36: India Dairy Product Exports to Top 5 Countries, By Value, 2013-2014 & 2014-2015 (USD Million)
104.6
50.3 36.9
30.7
33.0
28.7 11.3
Bangladesh
United Arab Emirates 2013-14
Pakistan
18.5
Nepal
3.7
8.0
Bhutan
2014-15 Source: DGCIS
Exports of milk has been comparatively low due to high domestic consumption. With the European Union lifting the ban on quotas, India is eyeing to target the EU market by exporting finished dairy products to the region. Increasing exports from India can be attributed to rising presence of private companies in India. Most of the private dairy companies are engaged in exports of dairy products given the profitability and demand for Indian
traditional sweets and ghee. Demand for these products is very high in the international market.
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Import Analysis In order to control the increasing prices of dairy products, government imported milk powder and butter at concessional duties in 2011. International milk prices in 2011 were higher by 17.75% YOY. Therefore, the government removed duty on skimmed milk products during the years 2010-2011 to control the prices. The main
reason for the high costs of milk powder in India was higher cost of procurement. Being the major milk producer, India does not import milk. In 2014-2015, India imported 5.28 thousand liters of milk contributing to USD 0.01 million in FY 2014-2015.
Table 03: India Dairy Product Imports, By Value (USD Million), By Volume (Thousand Tonnes), 2011-2015 Product Name
Volume
Value
2010-11
Volume
Value
2011-12
Volume
Value
2012-13
Volume
Value
2013-14
Volume
Value
2014-15
Milk powder
10,094.00
32.88
4,613.29
21.55
156.96
0.58
429.48
1.59
280.65
2.08
Ice cream
145.09
0.74
279.2
0.91
473.13
1.73
987.27
3.66
1,335.51
4.79
372.95
65.34
70.25
26.5
108.44
2.77
50.59
1.67
87.64
4.38
Cheese
411.05
1.84
298.33
2.39
214.94
1.55
62.01
0.35
34.98
0.27
Yogurt
189.93
0.46
90.29
0.31
87.29
0.27
97.37
0.26
22.74
0.07
Ghee
570.65
1.73
564.79
1.98
523.06
1.75
308.86
1.06
1,308.40
3.66
Butter
81
Source: Ministry of Commerce © TechSci Research
Export Analysis Ghee and butter are the key export products from India. Ghee is a traditional dairy product and has high demand in the foreign markets. Given cheap labor and production costs, the export price of ghee remains low. This also has created a major demand in the neighboring countries such as Bangladesh and Nepal. High consumption of milk in the country is the major reason for the low exports of milk. Bangladesh and UAE are the major importers of milk from India.
Table 04: India Dairy Product Exports, By Value (USD Million), By Volume (Thousand Tonnes), 2011-2015
Produc t Name
Volume
Value
2010-11
Volume
Value
2011-12
Volume
Value
2012-13
Volume
Value
2013-14
Volume
Value
2014-15
Milk
477.52
0.43
295.49
192.81
146.41
0.17
223.66
0.27
1,470.95
1.28
Milk powder
2,385.52
8.69
204.89
0.54
353.17
1.16
6,085.46
23.9
1,091.65
3.98
Ice cream
277.81
0.53
350.2
0.82
356.29
1.09
547.1
1.52
652.39
3.98
Butter
5,496.69
21.32
1,742.83
7.65
988.27
4.58
3,210.44
12.74
2,890.56
13.31
Cheese
1,083.68
3.01
722.99
2.83
910.91
3.78
896.06
4.01
1,745.54
6.54
Yogurt
2.08
0
0.66
0
8.23
0.02
28.14
0.07
2.44
0.02
Ghee
4,390.82
20.07
5,346.31
29.28
5,052.63
26.17
4,932.25
27.15
5,707.64
34.35
Source: Ministry of Commerce
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Supply Chain Analysis
Supply Chain Analysis
Inputs for Dairy • • •
Fodder Farming Veterinary Aid Animal Feed
Milk Production •
Large & Small scale Farmers
Chilling & Bulk Cooling
Milk Collection •
Chilling center at Villages & Districts
•
Milk Aggregators
Restaurants/Bakery Shops
Unorganized Sector
Value Added Dairy Products
Consumer
Marketing & Distribution • •
Retail Outlets Super/Hyper markets
Processing & Packaging •
Private & Government Plants
Transportation of Chilled Milk •
Refrigerated Vans
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Supply Chain Analysis Supply chain for dairy industry in India begins from supply of raw materials such as fodder, veterinary aid, etc., to the farm till the finished products reach end consumers. Milk produced at the farm level is procured from the bulk collection and chilling centers and processed using various techniques. The raw milk procured is stored at the bulk chilling centers and the solid fats are separated from the milk to manufacture products such as skimmed milk powder and whey powder, which require fats. Drinking milk is extracted from raw milk by processing it using various techniques, at the manufacturing facility
from where drinking milk, UHT, etc. are obtained and value added dairy products such as cream, yoghurt, cheese, milk powders, flavored milk, etc., are produced. These products are then treated to ensure that all bacteria and other pathogens are eliminated, and later stored at chilling and bulk cooling centers. Milk and other products are transported to packaging warehouses by using cold chain transportation, where the products are then packed according to requirements. From the packaging center, these dairy products are distributed to various retail outlets, from where they are delivered to consumers. Dairy products market which is majorly dominated by unorganized market distributes milk directly to consumers. The milk delivered does not always meet the required standards as it does not undergo any processing or treatment. Raw milk is also delivered to restaurants and other small industries, which produce value added dairy products at a small scale and is sold locally.
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Supply Chain Analysis Supply Chain Models & Technology Used Gujarat Co-operative Milk Marketing Federation Ltd., which operates under the brand name of Amul, follows a 3 tiered structure of supply chain wherein, milk producers supply milk to village dairy cooperative societies which is then processed at district cooperative unions and marketed by state marketing federations. Amul has created a network of more than 3 million milk producers which is processed by more than 25 district unions before, finally, reaching to the consumer. Amul has more than 30 sales offices with over 5000 wholesale distributors and around 700,000 retail outlets across the country. Mother Dairy works on a comparatively simpler supply chain model. The company sources milk from dairy cooperatives which is delivered through insulation tankers at 2 degree Celsius, in order to retain the
freshness of the milk. Milk, along with other dairy products, then reaches the customer through retail and exclusive Mother Dairy outlets. The milk and other dairy products are transported through reefer vehicles. These insulated tankers carry milk from regional collection centers and these vehicles are, then, utilized to transfer processed milk to the distributors. These insulation tankers typically covers the maximum distance of 100 kilometers from the chilling centers to deliver the products to mother dairy outlets. These insulated vehicles equipped with refrigeration unit and the temperature of the products are maintained at not more than 3-4 degree Celsius while transferring dairy products. ColdEX Logistics, Kelvin Cold Chain Logistics Pvt. Ltd., ColdStar Logistics Pvt. Ltd., Snow King Logistics, etc. are few of the leading companies which provides logistics services to dairy products manufacturers and dairy cooperative societies.
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Supply Chain Analysis
These logistic companies are introducing various technologies to ensure the delivery of fresh milk to the destination. The
vehicles are equipped with GPS tracking units which shows parameters like temperature,
route, speed of the vehicle, fuel consumption, time left to reach the destination, etc. Few of the vehicles are also installed with temperature loggers, which can monitor the temperature of the products. Companies like Hatsun Agro Products Ltd. Procures around 2.5 million litres of milk per day from more than 3,000,000 farmers in South India. The company has chilling centers in more than 85 locations from where around 1500 vehicles collect milk and supply to 9 processing dairies. Milk shed spreads over 5 districts in Telangana and Andhra Pradesh, 3 districts in Karnataka, 10 districts in Tamil Nadu and 1 district in Maharashtra. Heritage Foods is doing its business through a chain of exclusive retail stores, Heritage Fresh. The company has around 110 retail stores across three cities, 60 in Hyderabad, 16 in Bangalore and around 35 in Chennai. The dairy products ranges from, along with other products, milk, curd, ice cream, butter milk, dairy whitener, skimmed milk powder, etc. The company has more than 5000 sales agents and have given self employment
opportunity to 11,000+ procurement agents in rural areas.
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Market Dynamics
Market Dynamics
Drivers
Increasing Health Awareness
Challenges Lack of Efficient Supply Chain Management
Rising Cattle Feed Prices Rising Disposable Income
Growing Demand for Value Added Dairy Products
Unorganized Players Dominate
89 © TechSci Research
Drivers
Increasing Health Awareness Youth population, which has high exposure to digital media, is aware about the health benefits of milk-based nutritional beverages and its advantages. The youth population of the country has started adopting healthy dietary habits such as consumption of dairy products along with health supplements. Increasing awareness in rural and semi urban areas through television ments to purchase quality packaged products and rising incidence of malnutrition have also contributed to increasing consumption of milk and other dairy products in the country. Rising demand for low fat products from health conscious consumers, can be attributed to high risk of diseases such as obesity, high blood pressure, heart attacks, etc. Parents have also become aware about health benefits of consuming dairy products, which may otherwise lead to malnutrition. The National Family Healthy Survey shows that the percentage of underweight and malnutrition children in India declined to 29.40% in 2014 from 42.5% in 2005-2006.
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Drivers
Rising Disposable Income Rising disposable income levels has increased purchasing power of consumers. Consumers are opting for value added dairy products and packaged dairy products keeping in mind their nutritional content such as low fat and low cholesterol. Growing disposable income levels has resulted in improvements in standards of living of the people in India. Purchasing power of Indian consumers is expected to increase further in the coming years, thereby resulting in an increase in sales of milk and other value added dairy products such as ghee, cheese, butter, yogurts, probiotic drinks, etc.
Figure 37: India Disposable Personal Income, 2011 – 2015 (USD Billion) 2,303 1,593
2011-12
1,724
2012-13
1,872
2013-14
2014-15
91 Source: MOSPI © TechSci Research
Drivers Growing Demand for Value Added Dairy Products Buying and consumption patterns for dairy products have changed manifolds in India. With this shift in consumption patterns, demand for VADP such as ghee, cheese, butter, etc., has increased over the last few years. India drinking milk market is forecast to grow at a CAGR of 9.17%, in value , during 2016-2021. Ghee, butter, cheese and yogurts are expected to witness growth in demand during the coming years. Also, dairy product manufacturers are advertising VADPs as low fat, healthy products and this is encouraging consumers to increase consumption of these products. Increasing demand for VAPD can be attributed to changing food consumptions habits of costumers especially in urban areas. Figure 38: India Year on Year Growth Comparasion for Value Added Dairy Products and Non Value Added Dairy Products 2012-2021F
5.57%
6.67%
7.75%
4.66%
5.04%
5.43%
2012
2013
2014
12.10%
13.30%
14.76%
9.12%
9.68%
10.34%
11.13%
5.46%
5.65%
5.87%
6.17%
6.54%
7.00%
7.56%
2015
2016E
2017F
2018F
2019F
2020F
2021F
Non Value Added Dairy Products
92
Value Added Dairy Products Source: TechSci Research
© TechSci Research
Challenges Lack of Efficient Supply Chain Management Poor road conditions in India increases the transportation time required for dairy products, which may lead to spoilage of dairy products due to bacterial growth. The shelf life of milk and other dairy products is very low and in order to reduce spoilage of these products during transport, synthetic ingredients are often added, which may lead to hazardous diseases such as heart problems, kidney damage, etc. It is not feasible to transport/procure milk in India to longer distances, due to perishability of the product and lack of proper cold supply chain facilities for small players, especially in Tier II and III cities. Majority of the transport is owned by independent drivers and hence lack of proper organization leads to improper supply chain management, resulting in delay in milk deliveries.
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Challenges Rising Cattle Feed Prices
•
The major cost involved in dairy farming is cattle feed, which constitutes to about 69% of the total cost of production. There is a shortage of dry fodder during the monsoon season. This increases the prices of dry fodder due to high demand and low supply. Due to less availability of fodder, the milch animals produce less milk during the monsoon season.
•
The area under fodder cultivation is estimated to be about 4% of the gross cropped area. The grazing lands are
also gradually diminishing due to other competing pressures on land and priority is being given to cash crops.
Figure 39: India Demand & Availability of Feed and Fodder, 2014 (Million Tonnes)
416 253
222 143 53
Dry Fodder
Green Fodder
Demand
Availability
23
Concentrate
94 Source: DAHD © TechSci Research
Challenges Unorganized Players Dominate
The unorganized sector ed for a share of 70% in India dairy products market in 2015. The quality of milk sold in semi-urban and rural areas by the unorganized players is not regulated. In addition, rural market lacks awareness regarding health issues associated with adulterated or contaminated milk. Unorganized players dominate dairy products market in rural areas, where the milk sold is sub-standard, unpasteurized, and more often than not adulterated with harmful chemicals. Women in rural areas are
uneducated and also unaware of the quality standards and there is no proper mechanism to control adulteration. In addition, according to Food Safety and Standards Authority of India, about 70% milk samples collected across the country did not meet the required standards and water was the most common adulterant in milk. This shows the need for organized players in the market, who offer safer and hygienic products.
Bihar, Chhattisgarh, Odisha, West Bengal, Mizoram, Jharkhand, Daman & Diu, etc., are some of the states in the country, ensuring adequate quality standards according to Food Safety and Standards Authority of India.
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M a r ke t Tre n d s & D eve l o p m e n t s
Market Trends & Developments
1
Implementation of Favorable Government Initiatives
2 3
4
5
Adoption of Automation by Private Players
Rising Demand for Yogurt and Western Dairy Products
Steady Rise in Demand for Organic Milk
Increasing Demand For Packaged Products
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Implemen ta tio n o f Favo ra ble G overn men t In itia tives
Implementation of various governments initiatives such as National Dairy Plan to increase health awareness through various schemes such as ‘Mission Milk’ launched in April 2012, at National Dairy Development Board (Anand, Gujarat), in rural and urban areas led to a increase in demand for quality milk. Government realized the potential in this industry and launched various proactive measures to guide investors interested in establishing dairy processing plants and dairy farms. The government offers 25% subsidy on the establishment of small dairy processing units. With NABARD subsidy, the government is trying to bring structural changes in the unorganized sector to make initial milk processing possible at the village level. The Indian government with its various schemes is trying to strengthen the dairy industry in the country. Majority of the players in India dairy industry operate in the unorganized sector and the government is undertaking initiatives to change the scenario and have better control over quality. In the last 4-5 years, the dairy sector received private equity investments worth USD0.36 billion and foreign
players are also trying to enter India. Foreign players such as Danone Food and Beverages, Fonterra, HaagenDazs, etc. have entered into some segments of the market and are trying to increase their presence in the other dairy market segments.
98 © TechSci Research
Adoption of Automation by Private Players Dairy product manufacturers operating in the organized sector in India are investing in technology upgradations to increase productivity. Integration of latest technology in the dairy industry would enable easy monitoring of cattle health, thereby
limiting human interference. This trend is catching up among companies in India, due to their rising IPOs and increasing number of foreign players entering the market. Precision automation technologies and other technologies such as Daily milk yield recordings, Milk component monitoring (e.g. fat, protein, and SCC), Pedometers, Automatic temperature recording devices, Milk conductivity indicators, Automatic estrus detection monitors, and Daily body weight measurements would further boost the dairy industry in India Producers are focusing on promoting their dairy products, as free from bacteria due to the use of automated systems that ensures optimal cow wellbeing and minimal human handling. Rising number of bulk milk coolers and milk processing technologies that convert milk into other dairy products with a longer shelf life have not only reduced losses associated with the perishability of milk, but also opened up
new markets for surplus milk production.
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R i s i n g D e m a n d f o r Yo g u r t s a n d We s t e r n D a i r y P r o d u c t s Western dairy products such as creams, butter, cheese, etc., witnessed steady demand, due to changing lifestyles and diet patterns. With around 30% of the total population living in urban cities, demand for these products is projected to remain limited to major cities in India. Rising influence of the western culture has increased demand for processed food in the country. Also these products are ready to eat or easy to cook food products. Major players are investing in manufacturing of western products such as cheese and butter, on of rising demand for these products. Packaged yogurts in India are also witnessing substantial increase in demand, due to changing lifestyles of the young working class, coupled with rising disposable incomes levels of consumers.
Figure 40: India Year on Year Growth Comparasion for Indigenous Dairy Products and Western Dairy Products 2012-2021F
4.79%
5.85%
6.97%
4.28%
4.42%
4.79%
2012
2013
2014
10.91%
12.01%
13.39%
8.82%
9.38%
10.06%
5.53%
5.96%
6.23%
6.57%
6.98%
7.48%
5.58%
2015
2016E
2017F
2018F
2019F
2020F
2021F
8.34%
Indigenous Dairy Products
100
Western Dairy Products Source: TechSci Research
© TechSci Research
Steady Rise in Demand for Organic Milk Natural, functional, fresh foods in addition to products labelled as low calorie, lower sodium, no trans fats, gluten-free and GMO-free are appealing the health-savvy consumers in the country. Of late, consumers are turning towards adulteration-free, farm fresh milk and producers have also started advertising their products, as completely automated without interference of humans, thereby reducing chances of contamination. Growing demand for organic milk can be attributed to rising adulteration and increasing incidence of diseases associated with the consumption of contaminated milk. Upper middle and affluent class consumers in urban areas, especially in the metropolitan cities in India, are willing to pay a price for organic milk to stay healthy. In 2015, the market size for Organic milk in India was around USD40 million. Whereas, the overall organic dairy products market was around USD70 million. Further, demand for organic milk in India is projected to grow in the coming years, with producers advertising it as free from chemicals, pesticides and injected hormones. With the market being untapped, local players are trying to capture the segment, with the launch of numerous schemes and ments. However, supply chain and preservation remains a massive challenge in this segment. Companies such as Govind Organic Milk, Doctor Moo, Pride of Cows have been offering organic milk in cities such as Mumbai, Pune and Bangalore.
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I n c re a s i n g D e m a n d Fo r Pa c k a g e d P ro d u c t s Demand for packaged dairy products is increasing in India, as consumers are becoming conscious about the hygiene of products. Manufacturers are also demonstrating the need for packaged dairy products and are providing consumers with various options such as tetra packs, etc., which help increase the shelf life of the product. The seven layer packaging of tetra packs also allows manufacturers to ensure that dairy products do not get
sour in a short period of time, and longevity. Also given the lifestyle changes, the products can be stored easily for a longer duration of time and hygiene can be ensured at the same time. Food Safety and Standards Authority of India mandates that packaged products must be produced with proper labelling, showing manufacturing date, nutritional value, expiry date, price, quantity, etc. This information makes it easy for consumer to make purchasing decisions.
102 © TechSci Research
Policy & Regulatory Landscape Market Intelligence . Consulting
Policy & Regulatory Landscape
ISO International Organization for Standardization: ISO, the world’s leading developer of voluntary international standards, is an independent, non-governmental international organization for maintaining standards for production, packaging, etc. Most companies to maintain ISO standards, while they require rigorous quality protocols to be maintained. The ISO standards specify quality checks, hygiene levels, and how the quality checks have to be performed, etc. ISI Indian Standards Institute: ISI mark provides customer the guarantee of quality, safety and reliability. ISI mark is mandatory for dairy products such as milk powder. Companies have to follow certification procedures and obtain licenses to use ISI mark. Prevention of Food Adulteration (PFA) Act 1954: PFA Act was introduced to regulate adulteration of food products, which was rampant in India, especially in liquid dairy products. According to this Act, package foods need to carry a label, without any misleading information, notice of addition, ixture or deficiency in food, expiry dates etc. Milk and Milk Product Order (MMPO): MMPO was introduced by Food Safety and Standards Authority of India (FSSAI) in 1992, with an objective to maintain and increase supply of drinking milk of desired quality and regulating production, processing and distribution of milk and milk products. A certificate of registration is necessary under this order for setting up a dairy project in India.
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Policy & Regulatory Landscape
Food Safety and Standards Authority of India: FSSAI setup a few regulatory standards and guidelines for packaging dairy products, with a few minimum requirements such as Date of manufacture, Date of packaging, Lot number, Use – by date under packaging and labelling. The certification enables regulation of quality and safety of dairy products. The standards are updated regularly and products such as cheese, butter, infant milk, milk powder, etc., have to maintain required standards ranging from where and how the milk is procured, processing, packing, cleaning of the plants to disposal of the products. Foreign Direct Investment (FDI): Foreign Direct Investment (FDI) is made directly into production in a country by a company located in another country, either by buying a company in the target country or by
expanding operations of an existing business in that country. The government has allowed 100 per cent Foreign Direct Investment (FDI) in agriculture sector. Certain rules and regulations which are to be followed under this areRearing of animals under intensive farming systems with stall-feeding. Intensive farming system will require climate systems (ventilation, temperature/humidity management), health care and nutrition, herd ing/pedigree recording, use of machinery, waste management systems as prescribed by the National Livestock Policy, 2013 and in conformity with the existing ‘Standard Operating Practices and Minimum Standard Protocol.
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Policy & Regulatory Landscape Import Duty Structure Table 5: India Dairy Products Import Duty Structure, 2015 Products Along with HS Code
Basic Duty
CVD
Special CVD
Milk & Cream Not Concentrated containing added sugar(0401)
30%
0%
4%
Milk & Cream Concentrated containing added sugar (0402)
60%
0%
4%
Butter Milk, Curdled Milk & Cream, Yogurt and other fermented or acidified milk and cream (0403)
30%
0%
4%
Butter & Other fats and oils derived from milk, dairy spreads (0405)
40%
0%
4%
Cheese and Curd (0406)
30%
0%
4%
Ice Cream and other edible ice (2105)
30%
6%
4% Source: DGFT
As per the regulations ed by the directorate general of foreign trade, the imports of all dairy products are banned from China till 23rd June 2016. Impact of proposed GST on Dairy products: It is anticipated that the minimum rate of GST to be proposed by the Indian government is 18%. Currently, there is no tax levied upon any fresh dairy products like raw milk, products. Also, apart from the sterilised-sweetened-flavoured milks, none of the dairy products attract excise duty. If 18% rate is applied on the dairy Industry, would have direct implication on milk producers and would result in a decline in the prices of raw milk as paid to the milk producer.
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India Economic Profile
India Economic Profile Population (Million)
Female : Male Ratio (2015)
2015
1304.16 48.37%
2020F
1353.00
51.63%
Source: : World Bank
Population of India, Urban vs Rural 2015E
33%
Urban Population
67%
Rural Population
Population Growth Rate (2015)
1.34%
Source: : World Bank
Source: : World Bank
Unemployment Rate in India, 2015E
3.70%
3.70%
Inflation Rate in India
12.00 %
3.60%
9.30% 6.40%
3.50% 2010
5.80%
Source: : World Bank
Modes of Transport Mode
Number
Airports
346
Heliports
45
Railways
64,600 km
Roadways
4,689,842 km
Waterways
14,500 km
Merchant Marines
340
Pipelines
22,667 km
95 108 2012
2014
2015
2010
Source: World Bank
2012
2014
2015
Source: : Central Intelligence Agency
© © TechSci TechSci Research Research
India Economic Profile India’s GDP at Market Price (Constant), 2011-2015
India’s GDP Growth Rate, 2011-2015
(USD Billion) 1835.81
1831.78
1861.8
2308.02
2041.52
6.60%
6.90%
7.17%
7.46%
2013
2014
2015
5.10%
2011
2012
2013
2014
2015
2011
2012
Source: : World Bank, IMF
Source: : World Bank, IMF
GDP Share 2015
Sectorial Growth (2015)
17.00%
Agriculture
30.00%
Industry
53.00%
Source: : World Bank
Services
1.10%
5.90%
11.00 % Source: : World Bank
96 109 © © TechSci TechSci Research Research
C o m p e t i t ive L a n d s c a p e Market Intelligence . Consulting
G u j a r a t C o o p e r a t ive M i l k M a r k e t i n g Fe d e r a t i o n L t d . BUSINESS OVERVIEW •
•
•
•
• •
Gujarat Cooperative Milk Marketing Federation Ltd was founded in 1946 in Anand, Gujrat It is the Apex organization of the Dairy Cooperatives of Gujarat, popularly known as AMUL GCMMF procures 14.85 million liters of milk per day from 18,536 village milk cooperative societies covering 31 districts, and 3.37 million milk producer . The cooperative has a strong dealer network of 10,000 dealers and 10 lakh retailers operating through 56 sales offices. The company has a employee strength of approximately 750 people. In 2015, the company was planning to invest INR5 billion for the next 3 years to set-up new plants and to increase the milk production.
Certifications • ISO 2200:2005 • ISO 9001 • ISO 9001:2000 • ISO 22000:2005
RECENT DEVELOPMENTS • January 2016: Amul partnered with Wow designs for a design makeover for its flavored milk product, Amul Kool Milkshakes to rebrand Amul Kool Milkshake' as 'Amul Kool Shakers. • January 2016: The company inaugurated modernized semen station at Ode village, Gujarat. The plant was constructed at a cost of USD1.3 million. The semen station is run by Amul Research and Development Association (ARDA) • October 2015: In a move to expand its presence in Punjab GCMMF will procure milk from 1,000 villages in Punjab by putting up modern milk testing and weighment and bulk milk cooler system • August 2015: The company invested USD1.6 million approximately to triple its cheese production. • April 2015: Amul invested USD22 million to expand its presence in Punjab from 50 collection centers to 1,000. • February 2015: The company launched a super range of ice cream under the name Epic. • January 2015: Gujarat Cooperative Milk Marketing Federation Ltd. ppartnered with WOW Design for redeg the Amul Scooping Parlors, visually and structurally.
KEY PRODUCTS • Milk • Milk powder • Health beverages • Butter, Ghee • Cheese, • Ice cream, Paneer • Traditional Indian sweets
Key Personnel • Verghese Kurien(Co-founder) • Jethabhai P. Patel (Chairman) • R S Sodhi (Managing director)
Key Person • Atul Santoki (General Manager Marketing) • Nitin Mohan Shandilya (Marketing and Business Development ) • Email: [email protected]
111 © TechSci Research
N a t i o n a l D a i r y D e ve l o p m e n t B o a r d BUSINESS OVERVIEW
• National Dairy Development Board (NDDB) was
•
• •
•
founded in 1947 and doing business as Mother Dairy. The company is headquartered in Gujarat, India. NDDB manufactures and produces dairy products, edible oils, fruits & vegetables, frozen vegetables, processed food such as fruit juices, jams, pickles etc. The company employees around 3,500 people With state of the art manufacturing plants in Patparganj, Delhi. Pilkhuwa, UP, Vashi, Mumbai. Kachchh Junagadh, Gujarat. Tirupati, Andhra Pradesh. The company has covered 3,351 villages with additional hip of 177,507 producers.
Certifications : • FDA Certification • FSSC Certificate • EIA certification • ISO – 9001:2008 • ISO – 22000:2005 • HALAL • ISO 2200 • Kosher • SGF certification
KEY PRODUCTS Recent Developments • February 2016: The company announced • Milk • Milk powder to invest USD8.7 million for setting up a • Health beverages plant for frozen vegetables and fruit pulp • Butter off Ranchi, Jharkhand, and USD23 • Ghee million for setting up a facility for milk • Cheese and value-added dairy products near • Ice cream, Paneer Mumbai. • January 2016: Mother Dairy partnered with Environnemental Infrastructure & Services Ltd (IEISL) for selling organic compost product through Safal outlets, which is being supplied from Okhla composting facility, a public private partnership between IEISL and South Delhi Municipal Corporation for processing of biodegradable to compost. Key Person • September 2015: The company setup a • T N Datta, (General Manager) NDDB foundation to facilitate supply of free • +91-2692-226222 milk to underprivileged school children • July 2015: NDDB launched a mobile Key Personnel application that suggests a balanced diet • Shri T. Nanda Kumar (Chairman) • Dr S. Ayyappan (Secretary) for cows and buffaloes to help boost • Shri Jethabhai P. Patel (Chairman) dairy farmers' income by raising milk • Shri V. Kehie (Chairman) yield and cutting feed cost. HEADQUARTERS / • April 2015 : Mother dairy is planning to Address expand its business in east India by National Dairy Development Board PB No. 40 introducing dairy whitener products. • August 2014: National Dairy Anand - 388 001 Telephone: 91-2692-260148, Development Board (NDDB) launched a 260149, 260159, 260160 multi-pronged program involving Fax:91-2692-260157, 260165 cooperatives, to raise milk productivity e-mail: [email protected] and ensure remunerative prices to dairy Gujarat INDIA farmers in Odisha.
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K a r n a t a k a C o - O p e ra t ive M i l k P ro d u ce r s Fe d e ra t i o n Limited BUSINESS OVERVIEW
• Karnataka
Co-Operative Milk Producers Federation Limited headquartered in Bangalore operates under the brand name Nandini. • The company was started as a agency in 1975 aided by the World Bank and became a cooperative in 1983. • The company has its own packaging plant, Nandini Packaging Film Plant located near Bangalore.. • The company has regional presence in Karnataka mainly and operates across south India. • Karnataka Co-Operative Milk Producers Federation Limited has 2.32 million milk producers in over 13,157 Dairy Cooperative Societies at village level. • The company has 14 milk unions throughout the state, which procure milk from Primary Dairy Cooperative Societies (DCS) and distribute it to consumers in various urban and rural markets in Karnataka. • The company’s plant at Channarayapatna, Hassan District (Karnataka) with 400 Thousand Liters Per Day (TLPD) and 30 Metric Tons Per Day (MTPD ) Cream storage 60 KL, Butter storage 580 MT, Ghee storage 150 MT. The plant is setup in 22 acres of land.
The company has plants located at KEY PRODUCTS • Milk • Mother Dairy, Yelahanka, Bangalore. • Curds & other fermented products • Nandini Hi-Tech Product Plant, • Milk powder Channarayapatna. • Ghee & butter • Nandini Milk Products, KMF Complex, • Ice cream & Frozen Desserts Bangalore. • Milk Sweets • Cattle Feed Plants at Rajanukunte/ • Other Products • Chocolate Gubbi/ Dharwad/ Hassan/ Shikaripura. • Nandini Sperm Station (formerly known • UHT Milk as Bull Breeding Farm & Frozen Semen Recent Developments Bank) at Hessaraghatta. • June 2015:The company is • Nandini Packaging Film Plant at expanding its network in Munnekolalu, Marathhalli. Karnataka and invest USD 307 • Central Training Institute, Bangalore & million from 2015-2017, across a Training Institutes at Mysore/Dharwad number of facilities, including bulk • Ice Cream Plant, Bellary milk coolers, processing unit besides packaging and marketing Recent Developments facilities. • February 2016 :The company in a bid • May 2015:The company started to boost sales announced plans to open marketing its products in retail units in apartment complexes. It Hyderabad. has planned to setup parlors in 100 apartments in Bangalore. 2016: Karnataka CoOperative Milk Producers Federation Limited announced plans to introduce pet bottles for milk and curd and setup 100 MT capacity. February 2016: The company announced plans to setup two automated milk conversion plants, each with 100 MT capacity for an investment of USD47 million.
• February
•
Key Person • Ravikumar Kakade Director (Marketing) Email: [email protected]
11 3 © TechSci Research
Ta m i l N a d u C o - o p e r a t i v e M i l k P r o d u c e r s ' F e d e r a t i o n Limited BUSINESS OVERVIEW • Tamil Nadu Co-operative Milk Producers' Federation Limited founded in 1985, operates under the brand name Avvin milk and is headquartered in Chennai. • The company is a cooperative and functions under the Department of Animal Husbandry, Dairying and Fisheries (Tamil Nadu). The company is engaged in manufacturing milk and milk products. • The company has four manufacturing plants at Ambattur, with a capacity of 4 lakh liters per day, Madhavaram with a capacity of 3 lakh liters per day, Sholinganallur with a capacity of 4 lakh liters per day and Ambattur, which is engaged in manufacturing milk products • The company has three different wings for carrying out marketing of milk and milk products - Metro Liquid milk marketing, Metro Milk Product marketing and Up country marketing. • The company operates through 17 district Cooperative Milk Producers’ Unions functioning in Tamil Nadu, covering 30 Districts. There are 15 Dairies in District Co-operative Milk Producers' Unions with an installed processing capacity of 19.42 lakh liters per day (llpd) and 36 Chilling Centers (Functional) in District Co-operative Milk Producers' Unions with installed chilling capacities of 13.55 llpd. • The company has a R&D farm at Udhagamandalam, funded by ‘The erstwhile Indian Dairy Corporation” and technical guidance provided by ‘National Dairy Development Board’.
RECENT DEVELOPMENTS • June 2015: In order to simplify the milk distribution procedure, Avvin made onine milk cards. The consumers can procure milk cards post verification though its website in the year. • June 2015: A new plant to be commissioned in Perambalur at a cost of USD5.5 million with a capacity of producing one lakh litres of milk. • June 2015: The Coimbatore’s plant is to expand its capacity from present 2 lakh litres to 5 lakh litres per day with a investment plan of USD7.09 million. • January 2016 : The company set up its own treatment plant at Salem Tamil Nadu and is designed to treat 10 lakh liters of waste water a day at an average COD (chemical oxygen demand) load of 3,500 mg / liter.
KEY PRODUCTS • Milk • Ghee • Butter • Curd • Flavored Milk • Paneer • Milk powder • Cheese • Yoghurt • Cream • Butter milk • Ice-creams Certifications • The company has the following certifications for its manufacturing plants • ISO 9001:2000. • ISO 9002
Key Person • Mr M. Sundarapandian (DGM Marketing) Telephone no 044-23464578 Key Personnel • Mr. Thiru Sunil Paliwal (Managing Director • Tel no:23464504 HEADQUARTERS / Address Tamilnadu Co-operative milk producers' Federation Ltd., Aavin Illam, Madhavaram Milk Colony, Chennai 600051- Tamilnadu
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Andhra Pradesh Dairy Development Cooperative Fe d e ra t i o n L i m i te d BUSINESS OVERVIEW
Certifications
• Headquartered in Hyderabad, Andhra Pradesh
• Andhra Pradesh Dairy Development
Dairy Development Cooperative Federation Limited was established in 1981. • The company is engaged in manufacturing and distribution of milk and milk products Andhra Pradesh and Telangana. • The company’s milk procurement operations cover 11 districts. • The company is the major supplier of milk to Hyderabad. • Andhra Pradesh Dairy Development Cooperative Federation (APDDCF), has a milk processing unit at Kankipadu, Andhra Pradesh. • The company has around 14 dairy plants in the states of Andhra Pradesh and Telengana.
Other Relevant Information • The company has plants in Warangal, Hyderabad, Mahbubnagar, Khammam, Godavari, Chittoor, Krishna, Nizamabad, Medak, Karimnagar, Eluru, Kadapa, Ananthapur and Kankipadu • The company exports Vijaya milk and ultra high temperature (UHT) milk varieties, buttermilk, basundi, curd, lassi, butter milk, paneer, cooking butter, milk cake, ghee, skimmed milk powder and khoa to Southeast Asian countries. • The company exports ghee to Dubai, UAE and other west Asian countries and milk cream to South Africa.
•
•
•
Cooperative Federation Limited was the first dairy in the country to receive SA 8000 certification from the SGS International Agency of Sweden APDDCF (Andhra Pradesh Dairy Development Cooperative Federation Limited) received ISO 14001 certification in 2004, which recognizes it as the only unit in the country producing products suitable to international market. The dairy unit also has a license to enter food processing industry and manufacture juices and other high acid products. The factory of A.P. Dairy Development Cooperative Federation (APDDCF) at Lalapet was awarded ISO 9001:2008 certification by the British Standard Institute for receiving, processing and supply of milk and manufacture and supply of milk products.
KEY PRODUCTS • Curd • Butter milk • Ghee • Paneer • Doodh peda • Butter
Key Person
• • •
Dr. Papa Rao Iragavarapu General Manager Mr. Krishna Swamy Deputy Director Mobile No: +91 9440314094 Landline No: 0870-2447132
Key Personnel • Adhar Sinha, Managing Director
HEADQUARTERS / Address Andhra Pradesh Dairy Development Cooperative Federation Limited, Lalapet, Hyderabad Phone number +91-40-27019851 Email : [email protected]
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H e r i t a g e Fo o d s L i m i te d ( B S E : 5 1 9 5 5 2 )
Public 60%
Promoters 40%
Source: Company Annual Report
SEGMENTAL REVENUE BREAK UP 2014-15 By Business Segments 100%=USD310.33 Million Bakery, 0.28%
Agriculture, 3.92%
Dairy, 72.62%
Retail, 23.06% Renewable Energy, 0.12%
Source: Annual Report
Financial Metrics (USD Million) Particulars
2014-2015
2013-2014
Revenues
310.33
257.78
%growth
83%
92%
PBT
13.18
14.75
RECENT DEVELOPMENTS • August 2014: The company % margin 4.25% 5.72% announced plans to invest USD24 million during 2015-2019. PAT 4.22 6.78 • February 2015: The company % margin 1.36% 2.63% announced plans to invest USD4.3 Source: Annual Report million in the Dairy segment to increase its footprint in northern PE Ratio: 22.58 Share Price: INR 507.90 and western parts of the country. Mkt Cap: USD10.83 Billion as on 13th Feb- 15 Key s Source: BSE Joseph Rajiaj, AGM, Sales & STOCK PRICE PERFORMANCE Marketing) Stock Price Comparison Vs Indices Venkat Samavedam, Sales Manager 5 Feb ’15 – 8 Jan ’16 Email: 800.0 1,000.00 venkat.samavedam@heritagefoods. com 600.0 Key Personnel 400.0 500.00 • Mr. Seetharamiah Devineni (Chairperson) 200.0 Mr. Srivishnu Raju Nandyala(Director) 0.0 Mr. Lokesh Nara (Director) Feb-15 May-15 Aug-15 Nov-15 KEY FACTS ERM (VO) ERM BSE 250 Listing : BSE Source: BSE India, As on 08 January, 2016 Symbol: 519552 Debt and Cash Availability FYE :31ST Mar Industry: Dairy 2855.1 1272.4 HEADQUARTERS / 119.3 98.0 Address Dairy6-3-541/C, Panjagutta 2014-15 2013-14 Hyderabad - 500 082 Phone: 040 Debt Cash & Cash Equivalents 2339 1221 / 222 Source: Annual Report Fax: 040 - 3068 5458 Note : Debt Includes Short & Long term Borrowings Email: [email protected] Volume
OWNERSHIP STRUCTURE 2014-15
KEY PRODUCTS • Milk • Curd, • Ice cream, • Buttermilk • Flavoured milk • Dairy whitener • Skim milk powder
KEY METRICS
Share Price (INR)
BUSINESS OVERVIEW • Founded in 1992, Heritage Foods Limited has five main business segments - Dairy, Retail and Agriculture, Renewable Energy and Bakery. • Its headquarters is located in Hyderabad, India • The company has presence in Andhra Pradesh, Telangana, Karnataka, Kerala, Tamil Nadu, Maharashtra, Odisha and NCR Delhi for procurement and distribution of milk and milk products and its retail stores across Bangalore, Chennai and Hyderabad. • The company has around 3,000 employees across the nation. • The company has 134 bulk cooling and chilling plants. 14 Processing and packaging plants • The company is eyeing more than 10% of its revenue from e-commerce from next fiscal year.
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H e r i t a g e Fo o d s L i m i te d ( B S E : 5 1 9 5 5 2 ) Operating History
The company announced to setup 100 retail stores in the next five years with a investment of USD7.32 million in 2015.
2015 2014
2013
•
•
The company started commercial production at its 14th Packing Station in Industrial Area, Sonipet in Haryana.
The company has moved its retail business into a wholly owned subsidiary in 2013
117 Source: Company Website & Annual Reports
© TechSci Research
Hatsun Agro Products Limited (BSE: 531531)
Bodies Corporate 3.07%
Non Institutions 20.91% DII 0.02% FII Institutions 2.86% 2.88%
Promoter and Promoter Group 70.27%
Source: Company Annual Report
SEGMENTAL REVENUE BREAK UP 2014-15 By Business Segments By Geography (100% = USD439.72 million)
Financial Metrics (USD Million)
Particulars
2014-15
2013-14
Revenues
439.72
374.33
%growth
17.47%
3.74%
30.57
27.87
EBIT
Certifications • Food Safety Management % margin 6.95% 7.44% System Standard of ISO 22000:2005 PAT 5.86 12.22 • Quality Management System % margin 1.33% 3.26% Standard of ISO 9001:2008 Source: Company Annual Report • Environmental Management System Standard of ISO Share Price : INR 404.0 PE Ratio: 72.59 14001:200 Mkt Cap : USD43.49 Billion As of 8th January 2016 • MMPO -1992 Registration – Source: BSE FSSAI STOCK PRICE PERFORMANCE Key Person: Stock Price Comparison Vs Indices Sathyan Chandramogan, 4 Feb’15 – 8 Jan’16 Executive Director 10.0 300 Sam Joseph, Deputy 200 General Manager, Sourcing 5.0 100 Phone:08045316297 KEY FACTS 0.0 0 Listing : BSE Tickers: 531531 FYE : 31 Jan‘11 Industry: Dairy Products ERM (VO) ERM BSE 250 Source: BSE Volume
OWNERSHIP STRUCTURE 2014-15
KEY PRODUCTS • Dairy Whitener, • Skimmed Milk Powder • Ghee • Butter • Milk • Curd • Paneer
KEY METRICS
Share Price (INR)
BUSINESS OVERVIEW • Established in the year 1970 as M/s. R.G. Chandramogan & Co. set up Hatsun Foods Private Limited The company was incorporated as Hatsun Foods Private Limited in 1986 and went public in 1996 with its headquarters in Chennai. • The company is into manufacturing and distribution of dairy products across American, Middle East and South East Asian Markets • Hatsun Agro has 10 Manufacturing plants in India. • The Company’s sales were recorded at INR 2493.54 Crores in n 2013-14. • In Dec 2015, the company was planning to acquire cattle feed mill in Tamil Nadu. This move will further expand its cattle feed capacity.
Debt and Cash Availability (USD Million) Ice cream , 7.60% Milk products , 18.13%
38,914
Other, 1.01%
Milk , 74.27%
India, 98.99%
2013-14 Debt
Source: Company Annual Report
52,363 17,549
35,488
2014-15
Cash & Cash Equivalents Source: Company Annual Report
HEADQUARTERS / HATSUN AGRO PRODUCT LTD Domaine, Door No: 1/20A, Rajiv Gandhi Salai (OMR), Karapakkam, Chennai - 600 097. India. Phone: 044-24501622. Email : [email protected]
118 © TechSci Research
Hatsun Agro Products Limited (BSE: 531531) Operating History
Hatsun Agro Products finalized plans to acquire a cattle feed mill in Tamil Nadu for USD 2.8 Million
2015
2014
2013
•
The company launched ready-to-eat range of dishes under the brand Oyalo in 2014.
The company in 2013 expanded into Andhra Pradesh with the acquisition of Jyothi Dairy, set up a greenfield dairy plant and acquired a cattle feed plant in Tamil Nadu .
119 Source: Company Website & Annual Reports
© TechSci Research
OWNERSHIP STRUCTURE 2014-15 Public 30.44%
Promoter & Promoter Group 69.56% Source: Annual Report
SEGMENTAL REVENUE BREAK UP, 2014-15 By Business Segments (100%=USD 878.20 Million) Milk Powder 8%
Ice-cream 4% Curd Cheese Butter 1% 1% Flavoured Milk 1% Paneer 1%
Liquid Milk 76%
Ghee 8%
Source: Annual Report
KEY PRODUCTS • Drinking Milk • Paneer • Flavored Milk • Cheese • Curd • Butter • Ice-cream • Ghee • Milk Powder
KEY METRICS Financial Metrics (USD Million)
Particulars
2014-2015
2013-2014
Revenues
878.20
763.00
%growth
15.10%
23.99%
EBITDA
54.93
46.00
%margin
6.25%
6.03%
RECENT DEVELOPMENTS • June 2014: The company signed PAT 23.49 21.11 a Memorandum of Understanding with Central Bank %margin 2.67% 2.77% of India to provide financial Source: Annual Report assistance to milk producing Share Price: INR115.70 PE Ratio: 15.21 farmers. Mkt Cap: USD422.17 Million as of 1st April 2016 Key Person • Rajesh Sahu (General Manager, Source: NSE Sales) STOCK PRICE PERFORMANCE • Gagandeep Singh Marwah (Sales Stock Price Comparison Vs Indices Manager) March’15 – March’16 200.0 10.00 • +91-11-47006500 8.00 150.0 Key Personnel 6.00 • Dr. Rattan Sagar 100.0 4.00 Khanna(Chairman) 50.0 2.00 • Mr. Sanjay Dhingra (Managing 0.0 Director) Apr-15 Jun-15 Aug-15 Oct-15 Dec-15 Feb-16 KEY FACTS KWALITY (VO) KWALITY NSE Listing : BSE Symbol: 531882 Source: NSE FYE :31ST Mar Debt and Cash Availability (USD Million) Industry: Dairy HEADQUARTERS / 180.92 175.65 Address Kwality Ltd. 4.76 2.12 Kwality House F-82, Shivaji Place, Rajouri Garden 2014-15 2013-14 New Delhi - 110027 Debt Cash & Cash Equivalents Tel . 011 47006500 (100 lines) Source: Annual Report Email. [email protected] Note : Debt Includes Short & Long term Borrowings Volume
BUSINESS OVERVIEW • Incorporated in 1992 as Kwality Dairy India Ltd., the company was set up as backward integration unit of Kwality Ice Creams India Ltd. • The company was acquired by Dhingra Family in 2002. • The company has various milk processing plants located at Palwal (Haryana), Bulandsahar (UP), Saharanpur (UP), Jarar (UP), Sitapur (UP), and Ajmer (Rajasthan), which are capable of handling approximately 3 million liters of milk per day. • For direct collection of milk from milk producers, the company has milk chilling centers situated across Rajasthan, UP, Punjab, and Haryana. • Company is planning to launch new products catering to the increasing health awareness among the consumers.
( B S E : 5 3 1 8 8 2 , N S E : K WA L I T Y )
Share Price (INR)
Kw a l i t y L i m i t e d
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Kw a l i t y L i m i t e d ( B S E : 5 3 1 8 8 2 ) Operating History
The company secured rights from its founding father P L Lamba to use the 'Kwality' artwork for its dairy products and beverages. Kwality was selling its dairy products under the brand name 'Dairy Best'.
2015
2014
2013
The company entered into an agreement with Central bank of India to provide financial assistance to dairy farmers in producing quality milk.
The company has changed from Kwality Dairy (India) Limited to Kwality Limited
121 Source: Company Website & Annual Reports
© TechSci Research
Pa r a s D a i r y BUSINESS OVERVIEW
Other Relevant Information
• Headquartered in Delhi, Paras was established
• The company’s first unit was established
in April 1986 as Ved Ram & Sons • The company is engaged in manufacturing and exporting dairy products • It produces milk, dahi, paneer etc. with cow ghee being the latest addition to its portfolio The company operates across North America, South America, Eastern Europe, Southeast Asia, Africa, Middle East The company has 5 manufacturing units located at Malanpur, MP Gulaothi, UP Sandila, UP Sahibabad, UP It uses three different strategies for procuring milk - Franchise, Supplier and VLC System which involves use of Automatic milk collection Unit. The company sells its products in 16 states in India and in more than 25 countries around the world.
• •
• • •
• Certifications • ISO 9001 • Halal assured • HAC Certified • Agmark Certified • Apedia Certified • Kosher foods Certification • 2-STAR-EXPORT Certification from Government of India
• •
in 1987 under the name VRS Foods Limited The company sells approximately 2, 50,000 liters of milk per day In Delhi It covers 5,000 villages across Western UP, Haryana, Rajasthan, Maharashtra and Gujarat for collecting milk 154,000 villagers directly. September 2015: Paras launched a new exclusive milk outlet in Masuri Dasna Ghaziabad and Vaishali July 2014: The company added cow ghee to its portfolio. The company’s modern dairy ingredient plants is operating in technical collaboration with Westfalia Separator, A.G. , Filtration Engineering Inc., US and Applexion, Major exports are shipped to USA, , Egypt, Jordan, Libya, Ivory Coast, Afghanistan, Bangladesh, UAE and Pakistan. The company has a 6% market share in the city of Lucknow and 4% in Delhi. August 2013: The company launched seven color packaging for its milk variants to boost its sales
KEY PRODUCTS • Milk • UHT Milk • Flavored Milk • Dahi • Paneer • Ghee • Dairy Whitener RECENT DEVELOPMENTS • March 2012: Paras, invested D4.3 million in its dairy processing unit at Hardoi district in central Uttar Pradesh with a capacity of processing 3.5 lakh litres of milk/day
• 2011 : The company opened 14
new automatic Milk Procurement Centers in to cover 4400 villages
Key Person • Praduman Mahajan, Area Sales Manager • Email: praduman.mahajan@parasdairy .com Key Personnel • Rajendra Singh (Managing Director) HEADQUARTERS / Address D-55, Basement, East of Kailash New Delhi-110065 Ph :- 011 - 26427481-82, 011 - 40591303-04
122 © TechSci Research
Pa r a g M i l k Fo o d s L i m i t e d BUSINESS OVERVIEW Founded in 1992, Parag milk foods limited in headquartered in Mumbai, India • The company has Milk, Cheese Processing Unit and Dairy Farm in Manchar. Another Milk Processing Unit, Palamner with a capacity of around 1,000,000 liters per day. • It nurtures about 2,000 Holstein cows which are the world’s finest breed. • The company operates with four different brands - Gowardhan, Pride of cows, Topp up and GO. • The product portfolio includes ghee, milk, dahi, gulab jamun mix and paneer. • It has 14 depots and 103 super stockists, caters to over 3,000 distributors • The company has round 1600 employees. • Parag currently exports to over 37 countries across the globe. Future Expansion Plans • After launch of two variants of “Go Almette” cheese in Nov’15, company, in near future, is planning to increase its focus towards health and nutrition products to suit Indian taste preferences. •
Recent Developments • May 2015: Russia's Federal Inspection Agency Rosselkhoznadzor inspected the facilities of the company and allowed import of dairy products from their facilities to Russia. • April 2015: The company started producing whey a by-product of the cheese, it’s the first large dairy company in India to begin making whey powder
Recent Developments • November 2015: The company partnered with German cheese maker Hochland to import and market latter's cream cheese in India under a cobranding strategy. • October 2015: Parag Milk Foods entered fresh cream market with Go brand • March 2013: The company invested USD12 million in its plant at Palamaner in Chittoor district of Andhra Pradesh for manufacturing and processing value-added products. • June 2015: The company introduced Go butter milk in a strategic move to expand it portfolio. • April 2015: Parag Milk Foods launched Whey Products. • February 2015: The company announced to launch ghee in Uttar Pradesh as a part of its expansion strategy. • May 2013: International Finance Corporation (IFC) invested USD17 million in Parag Milk Foods Pvt Ltd for expanding milk processing projects at Manchar in Maharashtra and Palamaner in Andhra Pradesh. • September 2012: IDFC Alternatives invested USD27 million in Parag Milk Foods.
KEY PRODUCTS • Pure Milk • Ghee • Butter • Curd • Flavored Milk • Paneer • Dahi • Milk powder • Cheese • Yoghurt • Cream • Butter milk
Certifications • ISO 9000 • AGMARK
Key Person • Shirish Upadhyay(Sr. Vice President) • Ajay Singh Bhadoria(VP Sales) Email: [email protected] Key Personnel • Mr. Devendra Shah (Founder) • Mr. Pritam Shah (Managing Director) HEADQUARTERS / Address 20th Floor Nirmal Building, Nariman Point, Mumbai-400021. T- 022-43005555 Fax- 022-43005580
123 © TechSci Research
S t ra te g i c Re c o m m e n d a t i o n s Market Intelligence . Consulting
C o n c e n t r a t e o n Va l u e A d d e d D a i r y P r o d u c t s Change in customer’s consumption patterns, shifting consumer preferences towards value added dairy products (VADPs) such as butter, cheese, ice cream, etc., coupled with rising disposable income, etc. are few of the factors driving the demand for Value added dairy products in India. VADPs are high quality products which are priced
reasonably and are available at very convenient locations for customers to purchase. Price margins in drinking milk segment stood at around 4% – 5% whereas for VADPs it ranged from 12% – 18%. Product innovations in VADPs, such as low fat cheese, sugar free ice creams, flavored yogurts, etc., are likely to drive the demand for these products in India during the forecast period. Companies are, therefore, recommended to incline
more investments towards value added dairy products in order to capitalise on margins and volumes.
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Fo c u s o n Ru ra l A re a s With increasing disposable income levels of consumers in rural areas, there is a huge potential for dairy products, as there are only a few major organized players operating in rural regions of the country. Consumers in rural areas are in need of quality packaged products, presents
which
ensures
organized
hygiene
players
with
and an
safety.
This
opportunity
to
strengthen their position in the market. Manufacturers can establish dairy plants in rural areas, given the low establishment and procurement costs. This is expected to ensure low operational costs and high quality of dairy products. Additionally, hygiene and quality of dairy products can be ensured right at the procurement level. Companies are therefore recommended to establish themselves in these parts of the country in order to strengthen their market presence.
126 © TechSci Research
Fo c u s o n Pa c k a g e d P ro d u c t s
India dairy products market is dominated by the unorganized sector and does not follow any fixed packaging regulations. Demand for packaged dairy products such as butter and ghee, is increasing on of rising customer awareness. This is anticipated to drive demand for packaged dairy products that ensure hygiene. Dairy
product
recommended
to
manufacturers focus
on
are
thus
providing
proper
packaging of products, which ensures product longevity to increase product quality. Rising incorporation of reusable packages for products such as butter, ghee, cheese, etc., which can be stored for longer periods is attracting consumers.
127 © TechSci Research
Fo c u s o n I m p rov i n g S u p p ly C h a i n M a n a g e m e n t The supply chain of dairy products in India needs significant improvements. Lack of proper cold chain facilities in the country has resulted in large portion
of
dairy
products
being
disposed
off
unused. Strengthening of supply chain is forecast to ensure
less wastage of dairy products. In India, the transportation system needs improvements. Cold chain infrastructure is not available in the rural areas and this leads to complications in transporting dairy products. Improvements in cold storage facilities in the country is projected to reduce wastage and enhance productivity of the manufacturers. Companies are thereby recommended to improve
their supply chain structure to reduce product loss during transportation.
128 © TechSci Research
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Related Reports India Food Additives Market Forecast and Opportunities, 2020 United States Organic Foods Market Forecast and Opportunities, 2020 Global Cold Chain Market Forecast and Opportunities, 2020
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