Nov 3, 2020
Packaged food companies have become quite bullish and expanding their manufacturing capacity for packaged foods, as consumers opt for branded products thereby augmenting the sale of branded packed snacks noodles, cookies, ready-to-eat foods, condiments, and staples. Definitely branded packed foods have benefitted as consumers switch to known and popular brand during the pandemic.
Convenience foods such as pasta, noodles, and ready-to-cook food, poha; oats, etc. use at home increased as it was reflected in strong double-digit growth in foods that companies such as Marico Ltd, Hindustan Unilever Ltd, Nestle India, ITC Ltd., and Britannia Industries reported.
Bikano-packaged sweets, savoury snacks and Namkeens brand is investing in this development by adding a ₹200 crore plant in the city of Hyderabad to help expand the company’s presence in the southern market. The company has five production facilities across including in New Delhi and Greater Noida but the new plant will help reach more southern states.
Nestle India said it is set to invest ₹2,600 crores in India over the next three-to-four years to expand existing manufacturing capacities, apart from setting up a new plant in the state of Gujarat. The company has immensely benefitted from an uptick in in-home consumption with brands such as Maggi, Kitkat, Maggi sauces, and its portfolio of coffee brands witnessing “double-digit” growth.
The investment includes ₹700 crores the company announced last year in setting up a new plant for its packaged noodles brand Maggi.
While Britannia Industries has signed a MOU with the Tamil Nadu government to increase its investment in the state. The company’s portfolio of cookies, bread, cheese, and other dairy products remained in demand during the first half of the year. The food giant has announced that it has enhanced its investment plans from ₹300 crore to ₹550 crores over a period of 7 years in Tamil Nadu.
Food and beverages major PepsiCo is “extremely optimistic” about the future of the Indian packaged food market and increasing investment at its new greenfield snacks plant in Uttar Pradesh to ₹814 crores to meet increasing demand.
The company is committed to double its business from snacks business in India and also increasing the capacity of existing food plants in West Bengal and Maharashtra, and it has additionally proposed to set up a Greenfield manufacturing facility in Assam.
Nepal-based CG Corp Global that makes Wai Wai noodles said it is expanding capacity in four of its existing plants—including Assam, Ajmer, Chittor, and Purnia—a process that will take over a year to complete. The region wise capacity expansion will help the noodle maker with an additional 35% capacity for its India operations.
Most foods companies, unlike other FMCG firms, benefitted as in-home consumption spiked early on in the pandemic—even though out-of-home sales and institutional sales slumped.
LT Foods Ltd that sells the Daawat brand of packaged rice apart from organic staples said in-home consumption of rice increased by 1.5-2 kilos per household during the lockdown, according to third-party data available with the company. The company has invested Rs12-15 crore in increasing capacity of packaging units for small packs. LT foods invested in more packaging facilities in Europe, India, and some in the USA.