AGRO TECH FOODS LIMITEDSUNDROP OIL

Presented by :Abhishek kumar

P15FC060

SECTORIAL INFORMATION• Contribution to the worldwide economy

INDIA, 17US, 46.6

CHINA; 65.6

JAPAN; 71.9

UK, 87

TOTAL REVENUE IS 288.1 BILLION DOLLARS

USA INDIA CHINA JAPAN UK

SECTORIAL INFORMATION

GROWTH OF FMCG SECTOR

FINANCIAL YEAR 2009

FINANACIAL YEAR 2010

FINANACIAL YEAR 2011

FINANCIAL YEAR 2012

FINANCIAL YEAR 2014

0 5 10 15 20 25 30 35 40 45 50

24.2

30.2

34.8

36.8

47.3

GROWTH PATTERN OF THE FMCG SECTOR FOR PAST 5 YEARS

Column1

Rural areas expected to be the major driver for FMCG, as growth continues to be high in these regions. Rural areas saw a 16 per cent, as against 12 per cent rise in urban areas.

PORTER’S FIVE FORCES MODEL• Rivalry among competitors:

Its very fierce as market is saturated & all sorts of tactics like price wars, promotional activities etc are done to snatch the market share.

• Potential entry of new entrants:Highly viable as price effectiveness is the only factor.

• Substitute products:Plenty of substitute products are available.

• Bargaining power of suppliers:Low as a number of suppliers are present for this sector.

• Bargaining power of consumers:Very high as switching costs are very low & customers are never reluctant to try new things off the shelf.

COMPANY ANALYSIS• Agro Tech Foods Limited is a company with a dominant market

position in the edible oils and branded foods sector, in India. • The company was incorporated in 1986 as ITC Agro-Tech to enter the

oil seed and edible oils business. In October 1997, ConAgra acquired a 51.3 per cent stake in the company through its investment arm, CAG-Tech Mauritius. At present CAG-Tech Mauritius holds 49.24% of the total paid-up capital of the company.

• The company has well known brands like Sundrop, Health World, ACT II and Rath in its portfolio. The company has two business segments namely Branded Foods Segment and Bulk and Processed Commodities Segment.It has market share of 13.8%.

• A new initiative for manufacturing Instant Popcorn (IPC) in an location in Uttaranchal was successfully completed in February 2006.

COMPETITOR ANALYSIS

PRODUCTS OF AGRO TECH PVT LTD• Sundrop Oils, they constitute of the following product line

1. Superlite Advanced2. Heart3. Goldlite4. Olivea5. Nutrilite6. Nutrifit7. Lite8. Heartcare9. Superlite10. Slimlite

• Act II popcorn has the following product line1. Microwave popcorn2. Instant popcorn3. Ready to eat popcorn

• Sundrop peanut butter • Crystal sunflower oil

SWOT ANALYSIS & STP

PEST ANALYSIS• Political: Various factors such as governmental implications on production

and distribution of the product can have an influence on the company.

• Economic: If the buying power of the consumer decreases then they are deemed to search for cheaper substitutes such as canola oil. This would decrease the demand of the product and would also bring about a change in the overall company.

• Social: Social factors such as health consciousness, esteem in usage of premium goods, increase in the education levels of the consumers would help the company focus on its premium or top line products and on the other hand negative social factors like rumors will spoil the company’s brand image and hamper sales.

• Technological: These factors have a direct implication on the production systems as well as on the upliftment of the product. Hence its important to keep up with the technological advancements.

BCG MATRIX• QUESTION MARK: Sundrop Super light, olive oil. They have low market

share & high potential of market growth too due to rising number of health conscious consumers.

• STAR: Sundrop Heart. This product has been in the market since the initial years hence it has a large market share and with relative pricing and features it has a scope for growth too.

• DOG: Sundrop Slim lite.It has low market share as well as low market growth due to it being a spray oil having less relevance in the Indian market.

• CASH COW: Sundrop peanut butter. The only product of its kind. It has good market share but low market growth due to Indian taste preferences.

PLC OF SUNDROP

•Sundrop is in the maturity stage as it is seeing a stable degree of sales. •Secondly further penetration is not happening at this time.• The company may be coming up with new edible oil variants but sundrop oil is not bringing about any change.• This shows that sundrop oil is in the maturity stage as further no decrease in sales is happening and with an upsurge in the number of health conscious people the number of consumers is constantly increasing.

MARKETING & PRICING STRATEGY• Sundrop adopted strategy and execution in two folds:1. Position Sundrop as the healthy oil for healthy people2. Ensure that this did not in any way erode the delivery of the

'taste' benefit• Pricing Strategy:1. Since Sundrop oil commands a premium of 15 per cent over

other edible oil brands, the company should be able to cater to the demand of the all the customers from different purchasing power groups.

2. Sundrop launched three new products:Sundrop Goldlite - Rs 59 per litreSundrop Nutrilite - Rs 59 per litreSundrop Superlite - Rs 67 per litre

DISTRIBUTION STRATEGIES

'FEET ON THE STREET‘ Company is in the process of increasing retail distribution and consumer awareness of the product. Company has recruited salesmen and consultants who are responsible for increasing the distribution and display of products across the country. Also company has hired rickshaw pullers on a monthly salary to distribute products which resulted into cost-effective way to expand.

ADVERTISING• ADVERTISING GOALS:1. Position Sundrop as the healthy oil for healthy people.2. Ensure that this did not erode the delivery of the taste benefit.3. Positioning had to be perceptually as far away from competitors.4. Young, modern and premium feel.5. Execution had to be distinct and original to stand out from the

clutter.

• MESSAGE:1. Was related to maintenance of good health2. Was applicable to all members of the family3. Was characterized by lively energetic people4. Thus the message and (positioning): ‘The Healthy Oil for Healthy

People’

MEDIA & MEASUREMENT OF ADS• MEDIA:

Television ad for 30 seconds & Print Ads

• MEASUREMENT:1. Within 6 months, Sundrop became the largest selling refined

sunflower oil.2. Redefined the category and expanded the Sunflower oil

segment from 2.71% to 23% in 6 months, and 42% in 1997.3. Still the largest selling sunflower oil brand holds 15% of

branded oil market.4. The ad was shown for over 10 years.

GROWTH DRIVERS & OPPORTUNITIES:

• Growing Population Base• Urbanization & Evolving Eating Routines• Rising Preference for Healthy Oils'• Escalating Incomes• Surging Modern Trade• Low Per Capita Consumption• Rising Share of Branded Oils• Presence of increasing health issues amongst Indians.• Increase in import of word foods in the country.• An increasing trend of using different edible oils for

different foods.

PRODUCT PACKAGING

ATFL

FINANCIAL STATUS

FINANCIAL STATUS

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SOURCESThe following have been used as reference points to compile this project.

www.Aceanalyzer.comwww.ndtvprofit.comwww.economictimes/indiatimes.comwww.ibef.orgwww.atfoods.com www.mbaskool.comMarketing Management by Philip Kotler, Koshy & Jha Financial Management by I.M Pandey

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