ITC Limited's food division plans to launch two new products every month over the next 12-14 months to strengthen its presence in the organised packaged food market in India.
The company at present offers food products under five brands - Kitchens of India, Ashirward, MintO, Candyman and Sunfeast.
The company plans to grow the food division to Rs 500 crore through organic and acquisition modes. Its executives are not willing to provide the current volume of business generated by the food division.
ITC at present reports the sale of branded packaged foods under the heading 'miscellaneous', which also includes garments, greetings cards and stationary items. For the fiscal ended March 31, 2004, miscellaneous sales were Rs 314.43 crore as compared to Rs 110.53 crore in 2002-03.
ITC on Thursday launched the Sunfeast Milky magic brand of milk biscuits in Tamil Nadu.
Addressing the media at the launch of this new product, Ravi Naware, chief executive of ITC's food division, said the company had tied up with Tamil Nadu Milk Producers' Federation Limited (TMPFL) for procuring cow milk which is a key ingredient in this new product.
TMPFL will supply 6 MT of whole milk powder and 30 MT of skimmed milk powder over the next 2 months. Further orders for milk will be placed based on the demand for the end product.
Naware said the size of biscuits market in India was Rs 5000 crore of which Rs 3000 crore was accounted for by the organised sector. Glucose and milk biscuits account for 25 per cent each and marie biscuits 20 per cent of the biscuits market.
An estimated 70 per cent of the demand for milk biscuits in the country comes from Tamil Nadu, a main reason for launching Sunfeast Milky magic biscuits in Tamil Nadu.
Citing a study by AC Neilson, Naware said the biscuits market in India was on an average growing at 8-10 per cent per annum.