The investment is part of Mondelez International's $65 million outlay to develop a global research, development and quality units at nine locations around the world
Mumbai: Mondelez International Inc., the maker of Cadbury chocolates and Oreo cookies, on Monday said it would invest about $15 million in building a global research, development and quality hub in Thane, Maharashtra.
The investment is part of its $65 million outlay to develop a global research, development and quality (RDQ) ‘Network of the Future’ at nine locations around the world over the next two years, the company said in a statement.
The investment will enable the company to better recruit, retain and develop talent across a range of science and technical disciplines while also creating a stronger presence in both emerging and developed markets, the company said.
“We’re delighted that one of our nine technical hubs will be based in India," said Deepak Iyer, managing director, Mondelez India Foods Pvt Ltd , said in the statement.
He said India has a strong legacy of research and development, which has contributed to product and process innovation. “With a focus on chocolate and beverages, this centre will combine the high-end skills of our local team with global learnings and best practices to develop products and processes for Mondelez International globally," he said.
Mondelez India is the latest MNC to setup an R&D centre in the country. In 2013, L’Oreal India Pvt. Ltd, the maker of Maybelline and Garnier line of cosmetics, pledged Rs970 crore of investment in India and opened its first research and development (R&D) centre here. Since then the company has increased its India centric innovations, launching shampoos and conditioners in the herbal and ayurvedic space.
Others such as Hindustan Unilever Ltd, Pepsico India Holdings Pvt Ltd and Nestle India Ltd are also known for their focus on India-specific innovations.
“It makes sense for the company to open an R&D centre here as the business is now of relative size and they can develop a lot more locally relevant products," said Abhishek Malhotra, partner at consulting firm A.T. Kearney, adding that India can also be used as a hub for other emerging markets.
The Indian chocolate market, which was worth Rs5,800 crore in 2014, is expected to reach Rs12,200 crore by 2019, according to market research firm ValueNotes. Cadbury has a 60% share of that market, Mint reported on 26 April.
Mondelēz International has also set up centres in Mexico, the US, the UK, Poland, China, Singapore and Brazil. The centres in the US and UK are already fully operational.
The India technical centre will employ over 150 scientists, engineers and other specialists who will focus on developing technology platforms for chocolates and beverages, consumer science, packaging and cross-category productivity.
The company will start construction of the Thane facility in December. The site is expected to be fully operational by mid-2018. The new facility will come up at the site of the previous science and technology centre.
This investment is the second largest in the country by the company since it announced an investment of $190 million in the first phase of its greenfield plant at Sri City, Andhra Pradesh, that was inaugurated in April this year.