LT Foods sets up ready-to-heat organic rice plant in US
Mumbai: Leading basmati rice firm LT Foods on Wednesday said it has set up a ready-to-heat organic rice plant in US with an investment of $5 million.
“The initial capex investment on the plant is $5 million and expected to generate revenue of $21 million in next 5 years,” the company said in a statement. The products would be launched under the company’s organic foods brand EcoLife.
The company, which sells basmati rice under the Daawat brand, added that the new plant would manufacture 20 million pouches of ready to heat organic rice pouches in the initial phase and expand it to 70 million pouches by 2018. It expects to capture a market share of 8% in initial phase and increase to 12-15% over the next 5 years.
The market size for ready to heat rice products in US currently stand at approximately $265 million and it is growing at 14% on year. The company’s basmati rice brand ‘Royal’ is already the largest brand in US with a market share of more than 40%.
“We already have a strong presence in US through our Basmati rice brand Royal and we will be leveraging our strong presence and experience to grow our US market even further,” LT Foods chief executive officer and managing director Ashwani Arora said.
“Convenient, ready to heat rice options appeal to millennials, who are more likely to eat away from home or to snack rather than have a sit-down meals. We always closely observe changing consumer behaviour and we will keep launching new innovative products in line with consumer needs and preferences,” he added.