Both companies chalk out robust plans for gaining in position
Though summer is still a couple of months away, the Rs 800-crore branded ice cream sector is hotting up with two dominant players laying claim to the numero uno slot.
The Gujarat Cooperative Milk Marketing Federation (GCMMF) claims that its Amul brand enjoys a 36 per cent market share. This is way ahead of the 8 per cent of Hindustan Lever Ltd's (HLL) Kwality Walls, followed by the 7 per cent of Vadilal, the 4 per cent of the Chennai-based Hatsun Agro Product-owned Arun and the 3 per cent of Kolkata's Metro Dairy.
HLL, however, dismisses the numbers stating, "There is no authentic, audited source of ice cream market share in India." It, in turn, claims to be the market leader in the non-institutional segment based on its "internal assessments".
GCMMF makes claim of its leadership in overall volume and value of sales through the following details.
The Rs 3,700-crore cooperative forayed into the ice cream segment in 1997, producing around 4 million litres of ice cream worth Rs 27.40 crore. In 2005-06, volumes touched about 34 million litres valued at Rs 210 crore. "This fiscal we will end up at 42 million litres and a turnover of roughly Rs 270 crore from ice cream. We have set a target of 200 million litres by 2010," said Mr Jayen Mehta, Assistant General Manager (Marketing), GCMMF.
HLL's successive annual reports show that after hitting a peak of 24 million litres each in 1998-99 (Rs 171.26 crore), 1999-2000 (Rs 163.91 crore) and 2000-01 (Rs 156.39 crore), ice-cream sales tumbled every year to touch 8.6 million litres in 2002-03 (Rs 93.39 crore). Since then, however, there has been an upward trend, with sales amounting to 8.5 million litres valued at Rs 111 crore in 2005-06. "We have grown double digit over the last five quarters and that is only accelerating," said Mr Sailesh Venkatesan, Category Head, Ice Creams, HLL.
According to the company, volumes and turnover are not the sole criteria for judging market leadership, while stressing the value factor from non-institutional sales. However, figures from its 2005-06 annual report suggest that the contribution of the company's food business (which includes ice creams) to overall sales has dropped from 34 per cent in 1996 to 25 per cent. Meanwhile, both the companies have robust plans for gaining in position in the ice cream segment.
GCMMF recently launched its pro-biotic ice creams that have live beneficial culture that confer beneficial health effects such as improving immunity and digestion and strengthening bones. It also introduced a sugar-free ice cream range and is planning a Web site on ice creams. On the retail front, it intends to hike its Amul parlours from 600 to 10,000 by 2010.
Mr Venkatesan detailed HLL's strategy: "Ice creams has been identified as a core category by the company. HLL pans to build market dominance in India and drive category growth. "We plan to leverage Unilever scale innovation ability and technological expertise to launch new and differentiated products under the category. Several new product launches have been planned for the coming summer season. These include an array of flavours and formats that we believe the consumers will love eating."