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Concentrates_in_India.pdf

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Concentrates_in_India.pdf

  1. 1. Concentrates in India Euromonitor International February 2022
  2. 2. C O N C E N T R A T E S I N I N D I A P a s s p o r t i © E u r o m o n i t o r I n t e r n a t i o n a l LIST OF CONTENTS AND TABLES KEY DATA FINDINGS.................................................................................................................. 1 2021 DEVELOPMENTS............................................................................................................... 1 E-commerce acts as both boon and bane for companies, particularly partnerships with hyperlocal delivery players........................................................................................................ 1 Leader Pioma Industries focuses on fortifying its products....................................................... 1 Ayurvedic products focus on ingredients and increased e-commerce availability .................... 2 PROSPECTS AND OPPORTUNITIES......................................................................................... 2 Communication will continue to be focused on functional references....................................... 2 Brands promoting Ayurveda expected to do well in the forecast period ................................... 2 Versatility and rural areas set to underpin growth in concentrates ........................................... 2 CATEGORY DATA....................................................................................................................... 3 Concentrates conversions ........................................................................................................ 3 Summary 1 Concentrates Conversion Factors for Ready-to-Drink (RTD) Format........... 3 Table 1 Off-trade Sales of Concentrates (RTD) by Category: Volume 2016- 2021............................................................................................................. 3 Table 2 Off-trade Sales of Concentrates (RTD) by Category: % Volume Growth 2016-2021 ....................................................................................... 3 Table 3 Off-trade Sales of Concentrates by Category: Value 2016-2021 ................. 3 Table 4 Off-trade Sales of Concentrates by Category: % Value Growth 2016- 2021............................................................................................................. 4 Table 5 LBN Brand Shares of Off-trade Concentrates (RTD): % Volume 2018- 2021............................................................................................................. 4 Table 6 NBO Company Shares of Off-trade Concentrates: % Value 2017- 2021............................................................................................................. 4 Table 7 LBN Brand Shares of Off-trade Concentrates: % Value 2018-2021............. 5 Table 8 NBO Company Shares of Off-trade Liquid Concentrates (RTD): % Volume 2017-2021....................................................................................... 5 Table 9 LBN Brand Shares of Off-trade Liquid Concentrates (RTD): % Volume 2018-2021.................................................................................................... 6 Table 10 NBO Company Shares of Off-trade Powder Concentrates (RTD): % Volume 2017-2021....................................................................................... 6 Table 11 LBN Brand Shares of Off-trade Powder Concentrates (RTD): % Volume 2018-2021....................................................................................... 6 Table 12 Forecast Off-trade Sales of Concentrates (RTD) by Category: Volume 2021-2026.................................................................................................... 7 Table 13 Forecast Off-trade Sales of Concentrates (RTD) by Category: % Volume Growth 2021-2026 .......................................................................... 7 Table 14 Forecast Off-trade Sales of Concentrates by Category: Value 2021- 2026............................................................................................................. 7 Table 15 Forecast Off-trade Sales of Concentrates by Category: % Value Growth 2021-2026 ....................................................................................... 7
  3. 3. C O N C E N T R A T E S I N I N D I A P a s s p o r t 1 © E u r o m o n i t o r I n t e r n a t i o n a l CONCENTRATES IN INDIA KEY DATA FINDINGS ▪ Concentrates maintains solid growth in 2021, as consumers seek functional benefits in light of COVID-19 ▪ In 2021, off-trade sales of concentrates see current value and RTD volume growth of 9% and 5%, to reach INR13.8 billion and 363 million litres, respectively ▪ Pioma Industries Ltd maintains the lead in concentrates in 2021, with a 43% off-trade value share ▪ Concentrates is set to see an off-trade current value CAGR of 8% (4% CAGR at constant 2021 prices) and a volume CAGR of 5% over the forecast period, to stand at INR20.6 billion and 453 million litres in 2026 2021 DEVELOPMENTS E-commerce acts as both boon and bane for companies, particularly partnerships with hyperlocal delivery players Like most soft drinks, the majority contribution for concentrates comes from three to four months during the summer. In 2020 and 2021, the COVID-19 lockdowns overlapped with the summer season, thereby limiting volume growth slightly. However, the category continued to perform relatively well, largely due to the low unit prices of these products. In addition, companies partnered with online delivery platforms to offer their products to consumers and drive sales. In some cases, cost took a backseat as the main aim was to ensure that consumers did not shift to other brands due to lack of availability. However, although e-commerce is here to stay, and products will continue to be sold online on marketplaces such as Amazon and Flipkart, companies believe that partnerships with hyperlocal delivery players such as Swiggy and Dunzo are not sustainable in the long run. The commission charged by hyperlocal players is high, and the margins on concentrates do not make it worthwhile. In addition, although the fmcg giants can go the direct to consumer route, mid-sized companies cannot do this, due to high logistics costs and fuel prices. Leader Pioma Industries focuses on fortifying its products The demand for products with added health benefits is on the rise. The leading company in concentrates, Pioma Industries, has therefore been formulating products that cater to the health and wellbeing trends. To address this demand, the company fortified its products with vitamin E, vitamin B12, vitamin B6, selenium and zinc. It also ensures accessibility, as most of its consumers are from the bottom of the pyramid. The company heavily allocates resources to its digital medium for marketing products by partnering with food influencers. In 2021, it launched the #iloveyourasnarecipes campaign to interact with consumers, whereby influencers shared their recipes, and consumers, on the back of those posts, shared theirs. Nevertheless, traditional media remains vital for the company, and it continues to air commercials on television, communicating the benefits of fortification in its products. It is also diversifying by planning to extend its products into carbonates in 2022. The company believes it can leverage its vast distribution network and will not solely depend on e-commerce to sell its carbonates brand across India, unlike the smaller regional products. Its carbonates brand is expected to contain natural fruit and be priced slightly higher than the competition.
  4. 4. C O N C E N T R A T E S I N I N D I A P a s s p o r t 2 © E u r o m o n i t o r I n t e r n a t i o n a l Ayurvedic products focus on ingredients and increased e-commerce availability Ayurveda-influenced concentrates started gaining popularity in recent years, but COVID-19 accelerated their growth. As prevention has come to the fore regarding consumers’ approach to health due to the disease, Ayurveda is no longer considered a pharmaceutical approach. In the past, Patanjali and Sri Sri Tattva had introduced concentrates containing amla, rose, basil leaves, bottle gourd and aloe vera, which are gaining popularity in India. These brands have also extended their distribution reach by opening exclusive stores and utilising e-commerce. The latter was significant, as this channel gained share due to lockdown restrictions in 2020. Another big brand which has been doing well due to the move to e-commerce during the pandemic is Kapiva Ayurveda. Kapiva saw a considerable increase in concentrates containing amla, wheatgrass, aloe vera, tulsi and giloy, amongst other ingredients. Although its products are available through stores, most sales are through e-commerce platforms, including its website. PROSPECTS AND OPPORTUNITIES Communication will continue to be focused on functional references Concentrates is not the most popular soft drinks category, with these products mainly being targeted towards price-conscious consumers. This consumer cohort was also the hardest-hit during the pandemic, which forced consumers to re-evaluate their priorities. In the forecast period companies in this space will need to continue providing value to consumers whilst also communicating their health benefits. For example, Rasna, the most popular concentrates brand, focuses on communicating that its price is as low as INR2 per glass. However, although important, value can no longer be its sole selling point. Across the whole spectrum, the demand for products with preventative health benefits has increased. Historically, the top brands have positioned their products on value and fortification; however, communication will increasingly need to be dominated by the benefits of fortification. Also, the category will witness new launches which contain no artificial colours and flavours and no added sugar in order to avoid competition from substitutes such as juice drinks. Concentrates is therefore expected to see solid off-trade volume growth rates in the forecast period, along with stronger current value increases. Brands promoting Ayurveda expected to do well in the forecast period The health and wellness trend will continue to strongly influence concentrates, as COVID-19 has accelerated the demand for immunity-boosting products. Ayurveda-based liquid and powder concentrates from brands such as Kapiva Ayurveda, Patanjali and Sri Sri Tattva are expected to build a presence in concentrates in India over the forecast period. Many Indian consumers consider Ayurveda-based products to be naturally healthy and provide functional benefits. Similarly, brands such as Rasna and Tang will be marketed based on their fortification with minerals and vitamins. Demand for Ayurveda-influenced concentrates will be further supported by the aggressive marketing of Ayurvedic products elsewhere, for example in dietary supplements. Versatility and rural areas set to underpin growth in concentrates In addition to the convenience and low cost of concentrates, consumers appreciate their versatility. A primary advantage of concentrates is that not only can they be mixed with water, but they can also be used in the preparation of ice sweets, jelly, custard, mocktails, and others.
  5. 5. C O N C E N T R A T E S I N I N D I A P a s s p o r t 3 © E u r o m o n i t o r I n t e r n a t i o n a l Furthermore, companies that target demanding rural areas are set to fare well. The leading players in concentrates are targeting rural consumers, as growth in cities is increasingly being threatened by products that are more compatible with modern urban lifestyles, which are likely to resume as the country recovers from the pandemic. CATEGORY DATA Concentrates conversions The conversion ratio for powder concentrates has remained the same for some time, and in general, 100g of powder concentrate will yield around one litre of RTD beverage. Many Indians generally add sugar to sweeten the beverage even more. These conversion ratios are primarily dictated by the leading brands in powder concentrates, Rasna and Tang. In liquid concentrates, the conversion ratio has remained over five litres of RTD beverage per litre of liquid concentrate. This ratio is primarily determined by the leading brands in the category, Kissan and Rooh Afza. Summary 1 Concentrates Conversion Factors for Ready-to-Drink (RTD) Format Conversion factors Powder concentrates 1kg = 10 litres RTD Liquid concentrates 1 litre = 3.8 litres RTD Source: Euromonitor International Table 1 Off-trade Sales of Concentrates (RTD) by Category: Volume 2016-2021 million litres 2016 2017 2018 2019 2020 2021 Liquid Concentrates 118.0 124.1 128.8 133.5 138.2 143.0 Powder Concentrates 161.5 172.9 184.9 197.5 208.6 219.8 Concentrates 279.5 297.1 313.7 330.9 346.8 362.8 Source: Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources Table 2 Off-trade Sales of Concentrates (RTD) by Category: % Volume Growth 2016- 2021 % volume growth 2020/21 2016-21 CAGR 2016/21 Total Liquid Concentrates 3.5 3.9 21.2 Powder Concentrates 5.4 6.4 36.1 Concentrates 4.6 5.4 29.8 Source: Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources Table 3 Off-trade Sales of Concentrates by Category: Value 2016-2021
  6. 6. C O N C E N T R A T E S I N I N D I A P a s s p o r t 4 © E u r o m o n i t o r I n t e r n a t i o n a l INR million 2016 2017 2018 2019 2020 2021 Liquid Concentrates 5,621.2 6,030.3 6,461.0 6,858.3 7,296.2 7,871.9 Powder Concentrates 3,777.0 4,139.0 4,589.3 4,992.7 5,329.1 5,887.0 Concentrates 9,398.2 10,169.3 11,050.2 11,851.0 12,625.3 13,759.0 Source: Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources Table 4 Off-trade Sales of Concentrates by Category: % Value Growth 2016-2021 % current value growth 2020/21 2016-21 CAGR 2016/21 Total Liquid Concentrates 7.9 7.0 40.0 Powder Concentrates 10.5 9.3 55.9 Concentrates 9.0 7.9 46.4 Source: Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources Table 5 LBN Brand Shares of Off-trade Concentrates (RTD): % Volume 2018-2021 % off-trade volume Brand (GBO) Company (NBO) 2018 2019 2020 2021 Rasna Pioma Industries Ltd 47.6 47.1 47.2 47.7 Kissan (Unilever Hindustan Unilever Ltd 11.3 11.1 10.9 10.9 Group) Rooh Afza Hamdard Wakf 9.3 9.1 9.0 8.9 Laboratories Ltd Tang (Mondelez Mondelez India Foods 8.0 8.0 8.0 8.1 International Inc) Pvt Ltd Mapro Mapro Foods Pvt Ltd 0.6 0.5 0.5 0.5 Guruji's Guruji Products Pvt Ltd 0.5 0.5 0.5 0.5 Mala's Mala's Fruit Products 0.4 0.4 0.4 0.4 Ohm's Ohms Food Products Pvt Ltd 0.1 0.1 0.1 0.1 Manama Manama Farms & Foods 0.1 0.0 0.0 0.0 Tang (Mondelez Kraft Jacobs Suchard - - - - International Inc) India Pvt Ltd Others Others 22.2 23.1 23.3 22.9 Total Total 100.0 100.0 100.0 100.0 Source: Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources Table 6 NBO Company Shares of Off-trade Concentrates: % Value 2017-2021 % off-trade value rsp Company 2017 2018 2019 2020 2021 Pioma Industries Ltd 40.8 42.1 42.3 42.4 42.8 Hindustan Unilever Ltd 16.6 16.7 16.8 17.3 17.2 Hamdard Wakf 14.4 13.0 13.0 13.0 12.9 Laboratories Ltd Mondelez India Foods 6.2 6.8 6.9 6.9 6.9 Pvt Ltd
  7. 7. C O N C E N T R A T E S I N I N D I A P a s s p o r t 5 © E u r o m o n i t o r I n t e r n a t i o n a l Mapro Foods Pvt Ltd 1.3 1.3 1.2 1.2 1.2 Guruji Products Pvt Ltd 0.4 0.4 0.4 0.4 0.4 Mala's Fruit Products 0.4 0.4 0.3 0.3 0.3 Manama Farms & Foods 0.1 0.1 0.1 0.1 0.1 Ohms Food Products Pvt 0.0 0.1 0.1 0.1 0.1 Ltd Kraft Jacobs Suchard - - - - - India Pvt Ltd Others 19.7 19.1 18.8 18.3 18.1 Total 100.0 100.0 100.0 100.0 100.0 Source: Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources Table 7 LBN Brand Shares of Off-trade Concentrates: % Value 2018-2021 % off-trade value rsp Brand (GBO) Company (NBO) 2018 2019 2020 2021 Rasna Pioma Industries Ltd 42.1 42.3 42.4 42.8 Kissan (Unilever Hindustan Unilever Ltd 16.7 16.8 17.3 17.2 Group) Rooh Afza Hamdard Wakf 13.0 13.0 13.0 12.9 Laboratories Ltd Tang (Mondelez Mondelez India Foods 6.8 6.9 6.9 6.9 International Inc) Pvt Ltd Mapro Mapro Foods Pvt Ltd 1.3 1.2 1.2 1.2 Guruji's Guruji Products Pvt Ltd 0.4 0.4 0.4 0.4 Mala's Mala's Fruit Products 0.4 0.3 0.3 0.3 Manama Manama Farms & Foods 0.1 0.1 0.1 0.1 Ohm's Ohms Food Products Pvt Ltd 0.1 0.1 0.1 0.1 Tang (Mondelez Kraft Jacobs Suchard - - - - International Inc) India Pvt Ltd Others Others 19.1 18.8 18.3 18.1 Total Total 100.0 100.0 100.0 100.0 Source: Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources Table 8 NBO Company Shares of Off-trade Liquid Concentrates (RTD): % Volume 2017-2021 % off-trade volume Company 2017 2018 2019 2020 2021 Hindustan Unilever Ltd 27.6 27.5 27.5 27.4 27.6 Pioma Industries Ltd 23.2 23.2 23.0 23.0 23.1 Hamdard Wakf 22.7 22.7 22.6 22.5 22.7 Laboratories Ltd Mapro Foods Pvt Ltd 1.3 1.3 1.3 1.3 1.3 Guruji Products Pvt Ltd 1.2 1.2 1.2 1.2 1.2 Mala's Fruit Products 0.9 0.9 0.9 0.9 0.9 Ohms Food Products Pvt 0.1 0.1 0.1 0.1 0.2 Ltd Manama Farms & Foods 0.1 0.1 0.1 0.1 0.1 Others 22.8 22.8 23.1 23.4 23.0 Total 100.0 100.0 100.0 100.0 100.0 Source: Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources
  8. 8. C O N C E N T R A T E S I N I N D I A P a s s p o r t 6 © E u r o m o n i t o r I n t e r n a t i o n a l Table 9 LBN Brand Shares of Off-trade Liquid Concentrates (RTD): % Volume 2018- 2021 % off-trade volume Brand (GBO) Company (NBO) 2018 2019 2020 2021 Kissan Fruit Kick Hindustan Unilever Ltd 27.5 27.5 27.4 27.6 (Unilever Group) Rasna Utsav Pioma Industries Ltd 23.2 23.0 23.0 23.1 Rooh Afza Hamdard Wakf 22.7 22.6 22.5 22.7 Laboratories Ltd Mapro Squash Mapro Foods Pvt Ltd 1.3 1.3 1.3 1.3 Guruji Kesaria Guruji Products Pvt Ltd 1.2 1.2 1.2 1.2 Thandai Mala's Orange Crush Mala's Fruit Products 0.9 0.9 0.9 0.9 Ohm's Orange Squash Ohms Food Products Pvt Ltd 0.1 0.1 0.1 0.2 Manama Fruit Twist Manama Farms & Foods 0.1 0.1 0.1 0.1 Others Others 22.8 23.1 23.4 23.0 Total Total 100.0 100.0 100.0 100.0 Source: Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources Table 10 NBO Company Shares of Off-trade Powder Concentrates (RTD): % Volume 2017-2021 % off-trade volume Company 2017 2018 2019 2020 2021 Pioma Industries Ltd 65.5 64.6 63.4 63.3 63.7 Mondelez India Foods 13.8 13.6 13.4 13.4 13.4 Pvt Ltd Kraft Jacobs Suchard - - - - - India Pvt Ltd Others 20.7 21.8 23.1 23.3 22.8 Total 100.0 100.0 100.0 100.0 100.0 Source: Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources Table 11 LBN Brand Shares of Off-trade Powder Concentrates (RTD): % Volume 2018- 2021 % off-trade volume Brand (GBO) Company (NBO) 2018 2019 2020 2021 Rasna Pioma Industries Ltd 64.6 63.4 63.3 63.7 Tang (Mondelez Mondelez India Foods 13.6 13.4 13.4 13.4 International Inc) Pvt Ltd Tang (Mondelez Kraft Jacobs Suchard - - - - International Inc) India Pvt Ltd Others Others 21.8 23.1 23.3 22.8 Total Total 100.0 100.0 100.0 100.0 Source: Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources
  9. 9. C O N C E N T R A T E S I N I N D I A P a s s p o r t 7 © E u r o m o n i t o r I n t e r n a t i o n a l Table 12 Forecast Off-trade Sales of Concentrates (RTD) by Category: Volume 2021- 2026 million litres 2021 2022 2023 2024 2025 2026 Liquid Concentrates 143.0 147.7 152.8 157.8 163.0 168.4 Powder Concentrates 219.8 231.6 244.1 257.4 270.7 284.5 Concentrates 362.8 379.4 396.9 415.2 433.7 452.9 Source: Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 13 Forecast Off-trade Sales of Concentrates (RTD) by Category: % Volume Growth 2021-2026 % volume growth 2021/22 2021-26 CAGR 2021/26 Total Liquid Concentrates 3.3 3.3 17.8 Powder Concentrates 5.4 5.3 29.4 Concentrates 4.6 4.5 24.9 Source: Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 14 Forecast Off-trade Sales of Concentrates by Category: Value 2021-2026 INR million 2021 2022 2023 2024 2025 2026 Liquid Concentrates 7,871.9 8,078.2 8,286.6 8,484.8 8,686.2 8,892.2 Powder Concentrates 5,887.0 6,204.4 6,531.9 6,870.4 7,195.7 7,532.8 Concentrates 13,759.0 14,282.5 14,818.5 15,355.2 15,881.9 16,425.0 Source: Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 15 Forecast Off-trade Sales of Concentrates by Category: % Value Growth 2021- 2026 % constant value growth 2021/2022 2021-26 CAGR 2021/26 Total Liquid Concentrates 2.6 2.5 13.0 Powder Concentrates 5.4 5.1 28.0 Concentrates 3.8 3.6 19.4 Source: Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

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