Wednesday, July 13, 2016

Danone looks to ramp up India presence

While the dairy company is one of the most iconic brands in France and in many countries, it is still is a relatively small company in India, according to experts.
“However, in cities where its fresh dairy business operates, its share of shelves in the outlets—modern trade and selected general trade stores—is in the range of 25-40% of the yogurt category,” said Marcel, while explaining that over the next few years, it will expand the dairy business and look at a larger portfolio in India, besides deeper penetration within its existing markets. 
“Our ambition is that the leadership of Danone in fresh dairy or yoghurt category (in India) can be shared and also inspire us for other categories,” said Marcel, who recognized that the yoghurt category in which Danone is the global leader is still relatively small and still an urban trend in India. 
Globally, emerging markets account for over 50% of the overall revenues of the French dairy major. “India is a strategic market for Danone. It is one of the world markets with the highest potential to grow in coming years,” said Marcel, who is also looking at expanding the company’s footprint into neighbouring markets, including Nepal, Sri Lanka and Bangladesh.
The acceleration comes after five years in India during which the company has invested Rs.1,800 crore to build manufacturing facilities in Haryana and Punjab. 
It has also built its own milk collection system, working with farmers, and invested in milk coolers and setting up of a cold chain distribution network for its fresh dairy business, besides acquiring the nutrition business of Wockhardt Group. “We have been growing at a 20% rate for the last five years and we think we can continue and probably also accelerate it,” said Marcel.
As such, India’s dairy sector is one of the fastest growing segments within the fast-moving consumer goods sector. However, a large part of it is milk. Whereas Danone’s India portfolio consists largely of flavoured yoghurt, a product it is known for internationally, others such as lassimishti doi, or even custard have been designed by its research and development teams in India.
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