nhc foods limited presenation at... · the industry structure - food processing fruits...
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NHC FOODS LIMITED NHC FOODS LIMITED NHC FOODS LIMITED NHC FOODS LIMITED
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Industry Overview
Flour Mills 516
Fish Processing 568
Food & Veg 5,293
Meat Processing 171
Aerated Water 656
Milk Products 266
Sugar Mills 429
Solvent Extract 725
RTE, Culinary 1,74,296
Dairy
The Industry Structure -
Food Processing
Fruits &Vegetables
Meat & Poultry
Fisheries
Packaged Food
Beverages
Staples
Processed Milk Products
Raw & Processed Fruits & Veg
Poultry , Cattle, Sheep, etc
Marine Fisheries, Frozen & Minced
Snacks , RTE, Culinary Ingredients
Carbonated Drinks, Beverages
Sugar, Wheat, Bread, Flour
Market Segmentation & Units In The Organized Sector
Key Highlights-
80%
77%
50%
48%
15%
5%
Packaged Food
Beverages
Staple Foods
Fruits & …
Dairy Sector
Meat & Poultry
� The Food processing Industry is valued at USD 70bn and is growing at 14% annually and theIndustry ranks fifth in terms ofproduction, consumption, export and growth;
� As per CII estimates, the food processing sectorhas the potential to attract USD 33 billion in thenext 10 years & generating employment of 9million person days;
� India is the land of spices and seeds producing allvarieties worth over INR 45 billion amounting to25%-30% of world production.
� The size of the semi-processed and Ready-To-Eatpackaged food is over USD 1 billion and isgrowing at over 20%
� Packaged/Convenience Foods, especially culinaryingredients comprises 80% of the RTE segment.The market for this segment has been growing at20% with the market for culinary ingredientsgrowing at almost 18%
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Food Retail In India
� India is expected to become the world’s 5th largest consumer market by 2025from its current rank of being 12th largest;
� Food is the largest segment in terms of its contribution to the total value ofthe retail market contributing as much as 50% of the value of final privateconsumption;
� India’s urban population is increasing with around 41% expected to live incities and towns by 2030. Increasing urbanisation has increased the demandfor food consumption per family.
� Aggregate food consumption is expected to grow from INR 17 tn today toINR 34 tn by 2015 and INR 70 tn by 2025;
Market Segmentation-
62%9%
8%
6%
4%4%
4%
2%
1%
Food
Fashion
Liesure & Entertainment
Fashion Accessories
Consumer Durables
Health, Beauty & Pharma
Furniture
Telecom
Books & Music
Food Retail landscape
Traditional Format
Weekly Markets
Local KiranaStores
Govt. Shops
Modern Format
Super Markets
Dept. StoresShopping
MallsHyper
Markets
5000 sq/ft -
15000 sq/ft800 sq/ft -1000
sq/ft100,000 sq/ft
15000 sq/ft -100,000 sq/ft
Food/, Grocery, Household Products
Apparels, Durables, Accessories
Food, Durables, Apparels, Furnishings, etc
Food, Grocery, Apparel, Durables,Accessories
Consumer Food Needs -
Hawkers/ Other s
Fair Price Shops
Traditional Retailers
Organized Retail
Small –Medium
Retail Outlets
Open Format Outlets
Super Markets/ Food Chains/
Hyper Markets
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Snapshot of performance in 2010-11
International Sales Promotion:
NHC participated in Gulf food festivalat Dubai – 27th Feb. – 2nd Mar, 2011
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Our Infrastructure
� Fully integrated processing facility at Pardi, Gujarat – Set upat an appx. cost of INR 95 Mn
� Technology for the integrated and automated processingimported from Buhler, Germany;
� Capacity – 1ton/hr for processing Spices & 2tons/hr forprocessing seeds;
� On a 3 shifts basis/280 days annum, capacity – 6,720 tons ofspices & 13,440 tons of seeds
Processing Infrastructure -
- Laboratory
Plant at Pardi-
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NHC Accreditations
ISO 22000:2005 – Food Safety Management System &
ISO 9001:2008 Certification
Government of India’s Recognized Star Export House
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Business Model - NHC� 50 years of International business in agri
products– Spices, Seeds, etc
� Strong network with farmlands forprocurement – 50%-60% procurement is directlyfrom the farmlands & balance from millers and‘mandi’
� Global Client base– Singapore, USA, MiddleEast, Brazil, China, Australia, Europe, etc
� Already has 2 brands which are distributed only inthe overseas markets – ‘Indibite’ for bulk spiceand culinary products & ‘Eatmor’ for ready toeat products
� Fully integrated processing facility inGujarat to cater to bulk process ordersinternationally and private labels + culinaryproducts in the domesticmarket
� Launch of ‘EATMOR’ as a retail brand in thedomestic retail markets limited to savorysnacks on an outsourced processing model with in-house seasoning base recipes
� Launch of ‘SAAZ’ – culinary ingredientsbrand in the domestic retail markets entirelyprocessedwith in-house recipes at Gujarat facility
� Private Labels - Shift in business model tocater to a segmented market being Hotelchains, Food chains, Branded Processors ,etcprocessedat Gujarat facility
Key Notes -
Inherently De-risked Model
The vast expanse of existing international trading & Semi processing clientele de-risks/cross subsidizes the business modelThe vast expanse of existing international trading & Semi processing clientele de-risks/cross subsidizes the business modelsince, all the 3 revenue streams of processed products can effectively substitute the ever growing order book on the bulk trade side.This is possible since, the base raw material for the processing of all the 3 revenue streams remain the same . This also offers thebusiness model a huge scale advantage on procurements.
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‘‘SAAZ’
Sa Re KhaNa
Grounded Masalas
Hot Chilli Powder
Kashmiri ChilliPowder
Sabji Masala
Coriander-CuminPowder
Noodes
Black Pepper Powder
Chat Masala
Meat Masala
Chicken Masala
Turmeric Powder
Tea Masalas
Cumin Powder
Coriander Powder
Pav Bhaji Masala
Garam Masala
Blended Masalas
Our Upcoming Product -
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Marketing, Distribution, Branding………Roll Out
�Market leadership varied on masala type sold and not on single brand
The Roll-Out Plan – Pan India
2011-12
2012-13
2013-14
2014-15
2015-16
MaharashtraGujaratGoa
Rajasthan
Madhya PradeshChattisgarhDelhi
PunjabUttar PradeshAndhra Pradesh
BengaluruTamil Nadu
Phase I
Phase II
Phase Phase III
�No clear leader in the urban market - In terms of a single brand
Roll Out – Phase I : Maharashtra, Goa, Gujarat
Mumbai
Mah. & Goa
Gujarat
Market SizeRs. 4,360 millions
20 millions kgs
Rs. 2,200millions
10 millions kgs
Top 3 Brands
Everest ;Wagmare;Badshah; Suhana
Badshah,Mahalaxmi, Ramdev, Jalaram
Coverage 18 Zones
8 Regions& 63 towns
5 Regions& 63 towns
Sales Force 19 22 22
Company to target urban consumers first – Brand Promotion in Urban Towns
Company penetration in the above market – target 1% of market share in phase I
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Marketing, Distribution, .………Media Plan
Platform To Be Used
TV Radio Theatres Print
GEC *
Movie
Regional
Digital Format
Week-ends
Magazines News Papers
English -Movies
English -Female
English
Local
5 No’s
Regional
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Strategy & Vision
� Continuation In Global Trading & Semi Processing Activity – Global Client Base as an outlet for processed output � Continuation in trading& Semi Processing activity primarily to consolidate client base that would be a ready outlet for processed bulk agri products;
� Continuation & expansion of trading activities should be pursued since, it provides a de-risking of the revenue model and also an opportunity to explorenewermarkets first on a ‘traded’ product followed by a ‘processed’ output ;
� As a matter of strategy , both traded products and bulk processed output would be an Internationaloffering only
� Private Labels – Business To Be Promoted As An Outsourcing Facility –� Market For processed ingredients largely unorganized and ‘mostly‘ bulk driven – ample scope for ‘processors’ for customizing ingredients for end users
such as large food chains, Restaurants,Hotels, brandedRTE processors, etc
� A part of the processing capacity to be allocated – For DomesticOffering Only
� Retail Businesses – Culinary & Savory Snacks� Launch in phases – aroundGujarat andMumbai to start with since, near to processing location and easier to distribute
� Initially concentrate on those culinary products under ‘SAAZ’, where ingredients required in the processing are the same spices / agri products that NHCalreadyprocesses/tradesin its bulk business;
� Outsource the processing of Savory snacks under ‘EATMOR’. Launch only those snacks where the ‘seasoning’ base is the in house recipe of NHC –concocted from out of the same spices and agri ingredients dealt with by NHC in its bulk businesses. Launch of EATMOR aimed at opening theprocessingmarket of ‘seasoning’ base for NHC
Phase I
• Consolidate Trade & Bulk Processing;• Set Up 1 more processing facility in Gujarat;• Launch ‘ SAAZ’ & ‘EATMOR’ in select cities
Phase II
• Set up processing facilities pan-India- Cluster driven;• Own processing line(s) for RTE Segment;• Brand Distribution pan- India
Phase III
• Consolidate Brand Pan India;• Inorganic Growth• Launch Brands International
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Key Notes -
�Foray into the ever growing culinary ingredients retail marketwith its own brand offering – ‘SAAZ’ – Sa Re Kha Na;
�Vast Repertoire of 60+ recipes of masalas and mixes – researchedand concocted in-house
�Initial Launch – 14 masala types processed in house ;
�Roll out in a phased manner - Launch in Tier I cities of Gujarat, Mumbai & neighboring satellite towns;
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Th
ank
Yo
u
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