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FMCG major ITC Ltd plans to expand its dairy portfolio as it looks at a pan-India presence. The company will explore region-specific offerings to strengthen its position in the category.
According to Hemant Malik, Divisional Chief Executive – Food, ITC Ltd, the company will add paneer to its portfolio in two months.
The company is also eyeing the flavoured milk market with a pan-India launch through a “new brand”. Initial roll-out will happen in markets where ITC already has a strong distribution network, such as the South. The company will leverage its integrated consumer goods manufacturing facility at Kapurthala in Punjab to produce flavoured milk.
“We will ramp up our portfolio in the dairy sector with new launches some of which will be pan-India. Some products like milk and paneer could be region-specific or cater to areas close to where we are sourcing from. For instance, the immediate focus of milk and paneer are the Bengal and Bihar markets,” Malik told reporters at a press conference on Tuesday.
Dairy sector foray
ITC had entered the dairy sector in 2015 with the launch of ghee, under ‘Aashirvaad Svasti’ brand, in Karnataka, Kerala and Tamil Nadu. Subsequently, the product was extended to other markets .
Earlier this year, the company launched pouch milk, under the ‘Aashirvaad Svasti’ brand in Bihar. The company’s milk and curd products will go on sale in West Bengal tomorrow.
The initial target would be to capture 8-10 per cent of the market over a two-year period with consumer spends in the range of ₹400-500 crore.
Processing Unit
ITC has a milk processing unit at Munger in Bihar. The unit has a capacity of 250,000 litres per day; while it procures around 125,000 litres per day from various cooperatives in the region.
In West Bengal, the company is firming up its tie-ups with cooperatives in milk-producing districts of Burdwan and Hooghly.
“We plan to procure close to 100,000 litres of milk per day from cooperatives in Bengal. Ramp up will happen over time,” Malik said.
He did not specify the investments that ITC was making towards the milk processing unit in Munger or the capacity utilisation of the facility. “These are dynamic numbers and they keep changing as the need arises,” he said.
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