Kishore Biyani lays out roadmap for Future Consumer-Hain Celestial JV
Mumbai: Kishore Biyani has laid out a roadmap for Future Consumer’s 50-50 joint venture with New York state headquartered Hain Celestial Group, that sells organic food and personal care products.
The joint venture was announced in January this year.
“We will begin with three of Hain Celestial’s main products, Terra Chips, baby foods, and non-dairy milk products,” Biyani said at a press conference on Tuesday. “I believe Indians, especially mothers, are very conscious about brands, and more Indians today are lactose intolerant.”
With this joint venture, Future Group will have products competing with Nestle’s Cerelac baby foods, Pepsico’s Frito Lay’s chips, and Hershey India that sells non-dairy soy milk under the brand name Sofit. Other non-dairy milks include rice, almond, and coconut milks.
“We’ve identified a new plant in Tumkur, Karnataka, to manufacture Terra Chips”, Biyani said. “This will be rolled out by the end of December this year, made in India.”
Biyani added that the prices of Terra chips would be lowered from the current close to Rs400 a packet to around Rs100 a packet.
He said the joint venture will continue to invest in manufacturing facilities for these products over the next 4-5 years. However, Biyani declined to comment on how much investment has been made or is planned for the venture. “We have already assessed machinery requirements and other things for now,” he said.
“We have the products and Future (Consumer) has the distribution and the food park,” said Irwin Simon, founder and chief executive of Hain Celestial. “We’re partnering with the largest retailer in India.” Future Group set up an integrated food park in Tumkur, Karnataka, in 2014.
Hain Celestial, a $3.58 billion company by market capitalization, was founded in 1993 and listed on the NASDAQ in 1994. Most of its sales come from consumer food products, particularly the Whole Foods chain of retail stores in the United States. Hain also owns and markets the basmati rice brand Tilda, for which it sources rice from India.
Future Consumer has, in the past, brought other foreign food and personal care brands to India. For instance, in 2013, it introduced California-based citrus juices brand Sunkist.
Biyani and Simon emphasized the growing demand for healthy and organic food among increasingly health-conscious Indians. However, it may have to contend with the growing popularity of ayurvedic and ‘traditionally’ made food and personal care brands in India that health-conscious consumers have also taken to. “I don’t think that will be something we will be thinking about,” Biyani countered. “There isn’t much ayurvedic (trends) in packaged foods, except perhaps things like Chyawanprash.”