Rasna Private Ltd, a company that makes soft-drink concentrates, plans to foray into the packaged food and health-drinks business in a bid to tap growing demand for these products.
It is considering both organic and inorganic routes to expand into the new segments and into new markets.
Rasna currently accounts for a 90% share (in volume terms) of the preparatory drinks industry, currently valued at Rs350 crore. The company sells branded ingredients in a pack that consumers use to prepare concentrates. They then use this concentrate to make soft drinks. According to Rasna’s chairman and managing director Piruz Khambatta, the company now plans to enter what he terms the “non-concentrate functional” drinks market, with products such as health drinks.
The new products are likely to be launched by the next summer, said Khambatta. “Our new portfolio of drinks will have more nutrients, anti-oxidants, and characteristics other than refreshment and fun.”
Rasna has been exporting snacks and packaged foods to the US, Europe and West Asia. Now, it plans to launch these products in India and is also keenly looking at acquiring companies operating in this segment. “We are ready to acquire companies in the range of Rs30-100 crore to boost our food portfolio,” said Khambatta. The company that used to advertise heavily on television till two years ago, is now focusing more on on-ground platforms. “Our Rs 12-15 crore advertising budget has remained consistent over the past several years, but we are now investing more in retail marketing,” said Khambatta.
Besides expanding in the domestic market, the company is also seeking to bolster its presence in global markets. Rasna is already present in 40 countries across the world and is looking at entering new markets. “We are in the process of entering new markets such as Congo, Angola and countries in the Commonwealth of Independent States. These markets are somewhat similar to India, where there is a high demand for low-cost beverages, especially after the ready availability of real fruit juices, which are 8-10 times more expensive,” said Khambatta.