MTR Foods is cooking up plans to expand its manufacturing capacity and explore newer markets with an aim to achieve a Rs 1,000-crore turnover by 2015.
It will sharpen focus on three categories – masalas, mixes and snacks.
The company earmarked Rs 250 crore for its expansion plan. Of this, it has spent a little over Rs 100 crore on capacity expansion and launching newer products. “We intend to invest another Rs 150 crore in the next two years for upgrading and expanding capacity at our existing facility,” said Sanjay Sharma, CEO, MTR Foods Pvt Ltd.
MTR, owned by the Norwegian company Orkla Group, currently has 200 products across nine categories such as masalas, ready mixes, ready-to-eat foods, vermicelli, snacks, beverages, ice-creams, pickles and
To reach its turnover target, it plans to launch new products in the three categories, as they contribute over 70 per cent of the company’s turnover. Besides, Sharma says, there is enough room for growth in these areas. As a part of this strategy, it will explore the South market further with State-specific products. Today, it launched sambar, rasam and kulambu masalas , targeted at Tamil Nadu.
According to Sharma, the State is by far the biggest market for masalas in the country, accounting for Rs 700 crore of the total Rs 1,250 crore.
Two players – Sakthi Masala and Aachi Masala – control 93 per cent of this market, MTR’s share is 1 per cent . But, with these products, it expects to take its share up. Sharma says though Sakthi and Aachi were instrumental in growing the market here, there is a clear need gap for high-quality premium products, as current players have designed their offering as low-cost products. At present, Tamil Nadu accounts for 11 per cent of the company’s turnover. These products will take it to 15 per cent, he said.
Besides expanding its distribution and sales network in the State, it has earmarked Rs 35 crore for advertising through print and electronic media to promote these products. And, for the whole country, it has increased its ad budget to 16 per cent of its turnover from 8 per cent last year.
MTR closed the year 2011 with a turnover of Rs 350 crore (8 per cent of this came from exports). It hopes to close the current calendar year with a turnover of Rs 450 crore.