Beverage Industry - India

8/12/2019 Beverage Industry - India

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Our fruit and vegetable juice market research answerquestions such as:

What is the market size of fruit and vegetable juice?

What are the major brands in fruit and vegetable juice?

What are the flavour trends in fruit juice and vegetablejuice?

What is the market share of smoothies in the 100%juice sector? Have there been any new product

launches in the last year? What is the key on-trade distribution for fruit juice and

vegetable juice?


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Indian food processing industry $ 65.6 Billion

Expected to touch US$ 66.3 billion by 2018, registering a growth of 18 per cent.

The beverage industry in India constitutes of around USD 230 million

Indias beverage market is largely unorganized, with nearly 75% of the demandserviced by companies in the unorganized sector.

According to another report by researcher Business Monitor International, theIndian market of non-alcoholic beverage market comprising carbonated drinks,juices, bottled water, ready-to-drink tea and coffee, and sports drinks is expectedto touch $5.18 billion by 2015.

the Indian non-alcoholic beveragesmarket was estimated at around Rs 5,000crore, which is growing at 15% year on year.

The market for functional drinks is estimated at close to Rs700 crore. The organised water category is estimated at close to Rs3,000 crore

According to market researcher Nielsen, Indias branded packaged juice market isestimated at Rs 1,000 crore and growing annually at 15-20 per cent.
http://economictimes.indiatimes.com/topic/non-alcoholic%20beverageshttp://economictimes.indiatimes.com/topic/non-alcoholic%20beverageshttp://economictimes.indiatimes.com/topic/non-alcoholic%20beverageshttp://economictimes.indiatimes.com/topic/non-alcoholic%20beverages


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Indian Food Market

$ 380 Billion [Yr. 2012]


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Food Processing Industry$121 Billion [2012] to $194 Billion [ 2015]

Growth 10%; Exports : 12%


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Segments in Food Processing Industry

Food ProcessingIndustry

Dairy

Fruits &Vegetables

Grains & Cereals

Fisheries

Meat & Poultry

Consumer Foods

Dairy: Whole milk powder, skimmed milkpowder, condensed milk, ice cream, butterand ghee, cheese

Fruits & Vegetables : Beverages, juices,concentrates, pulps, slices, frozen anddehydrated products, potato wafers, chips,etc.

Grains & Cereals : Flour, bakeries, starchglucose, corn flakes, malted foods, vermicelli,beer and malt extracts, grain based alcohol

Fisheries: Frozen and canned productsmainly in fresh form

Meat & Poultry : Frozen and packed mainlyin fresh form, egg powder

Consumer Foods : Snack foods, namkeens,biscuits, ready to eat food, alcoholic and nonalcoholic beverages This includes packaged foods, aerated soft

drinks, packaged drinking water and alcoholicbeverages

Packaged foods segments comprises bakeryproducts, ready-to-eat snacks, chips, namkinsand other processed foods / snack foods.


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Non Alcoholic Beverages

Rs. 6000 Cr.

Carbonated Drinks

Rs. 1800 Cr.

Growth : 1012 %

Aerated Functional Drinks[sports drinks, energy

drinks and aerated juices]Rs. 600 Cr.

Non Carbonated Drinks

Rs. 1200 Cr.

Growth : 3540 %

Hot Beverages

Rs. 3000 Cr.

Growth : 1.2 %


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Indian FNB Industry$40.3 Billion

Packaged juices

market $ 200 million ;Growth : 15%

Fruit Drinks : 30%fruit content; 60%

share of market

Fruit Juices : 100%fruit content; 30%

share of the market

Nectars : 25-90% fruitcontent; 10% share of

market

The rising number of health-consciousconsumers is giving a boost to fruit

juices; it has been observed that

consumers are shifting from fruit-

based drinks to fruit juices as they

consider the latter a healthier

breakfast/snack option.


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Packaged Juices Market

54%30%

16%

Market Shares

Dabur

Pepsi

Others


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Packaging

As per studies, the most preferred pack size is the individual (small)pack which is convenient, and easy to carry and consume. These are in great demand as out-of-home consumption is on the rise.

Consequently, there is a growing consumer base, and also intensecompetition.

Tetrapaks are most popular among manufacturers as well asconsumers.

Some companies are also offering their products in tins (e.g. DelMonte) and PET bottles (e.g. Mazza); however, they are moreexpensive than Tetrapaks, which adds to production costs, and, as aresult, affects the market price.

Fruit juices have created a space for themselves in regularhousehold menus, as a part of a familys breakfast, socialgatherings, and evening snacks. As a result, consumers are pickingup multiple family packs at one go, which is an emergingconsumption trend.


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Growth Drivers

Indian Packaged Juices Changing consumer lifestyles : Given the change in eating habits, the wider global

exposure, and the growing time-poverty, has provided a fillip to the convenience

food segment. Again, consumer preferences are shifting towards healthier

lifestyles. As a result, the packaged juices market has charted a high growth

trajectory thanks to its easy availability, anytime-anywhere consumption, and

convenience. Juices are often seen to be quick, yet nutritional, fillers. Increased Health Awareness : The rising awareness about heart- and weight-

related health issues, especially among teenagers and young adults, has

propelled the consumption of packaged fruit drinks. There is also a greater

preference for these healthier beverages than carbonated soft drinks.

Hygiene matters : Juices are healthy only when prepared hygienically. Packaged

juices from trusted national and international brands have usually been preparedand certified to be in accordance with health and safety regulations. They thus

underpin the confidence of consumers in considering them to be a healthy and

convenient option, as compared to the fresh juices available at local joints and

street stalls.

Growing category of informed buyers : There is a growing category of informedbuyers who are able to distinguish between fruit-based beverages and fruit juices.


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These consumers are health conscious, highly aware, and have higher disposableincome. They have, therefore, led the demand for 100% fruit juices in the past

couple of years.

Rising Disposable Incomes : In the past few years, there has been a sharp change

in the number of nuclear families, in tandem with a surge in the number of

working couples, which has led to higher disposable incomes. This has aided the

affordability of packaged fruit juices, which are fast replacing fresh, homemade

juices and becoming a compulsory item on breakfast tables.

Booming modern retail : The dynamics of growth in the fruit-based beverage

space are attributed to modern retail and alluring shelf displays which drive

impulse purchases.

Habitual purchase : The trend of consumers evolving from fruit drinks in bottles tosweetened juices to 100% packaged juices has been observed largely in the past

couple of years. Consumers are buying in greater quantities, for household

consumption, and buying fruit juices is becoming more of a habitual purchase than

a need-based purchase.

Introduction to new flavors : To kindle consumers interest in the category and

also to cater to diverse and changing tastes, fruit juices providers are introducing


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Key Challenges

Among all challenges, it is difficult to control the cost of production at theprice points of juices, primarily because of rising food inflation. Thecontinuous, year-long supply of raw materials, and the non-stopproduction of juices for the full season, is another production-linked issuewhich needs to be managed carefully. Also of vital importance iscontrolling transportation and logistics costs.

Packaged Juices are gradually cementing their place in the urbanhousehold in the metros and Tier I cities; however, replicating the samesuccess in Tier II and Tier III cities is still a struggle as residents in theseregions still prefer fresh juices over packaged ones as they arecomparatively cheaper and also in sync with the traditional belief thatjuices are best consumed freshly pressed. Challenging and changing

consumers perspective on value for money, to grab a regular spot in thecommon household basket necessitates an aggressive stance towardsimproving consumers awareness on the positive attributes of packagedjuices and their merits over locally available options.


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Opportunities

Shift towards 100% juices from sweetened juices: This offers a wide opportunity toexisting and upcoming juices manufacturing companies to spruce up their existing

business and plan as needed for business or capacity expansion.

Healthy proposition: it has been observed that consumers are making healthy

choices in their beverage consumption; therefore, fiber-enriched juices and no

sugar juices are more in demand. Some new juice variants claim to have no added

sugar; this can be positioned as a health attribute, e.g. Dry Fruit Apple Juice byBalan Natural Foods Unique offering: Consumers are seeking unique fruit flavors

apart from the usual mango, orange, or lime-based fruit juices. Companies

intoned to identify some of the unique fruit juices that can be offered

- Dry Fruit Apple Juice for instance, which is much sought after due to the

nutritive benefits provided by the combination of dates, figs, raisins, almonds, and

apple concentrate.

Wider Options: Companies need to offer wider varieties and options for the

consumer to choose from, ranging from mixed fruit juices to pure, single fruit

juices to dry fruit juices. Thanks to higher incomes, consumers are willing to

experiment with variety and pay a premium for such value-added products.


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Product extension: There has been some recent product extension, e.g. Tropicana

launched Tropicana Fruit Powder with no preservatives or artificial flavors, which

will be available in single-serve sachets and can be made into a full glass of juice

simply by adding water.

It is appropriate to say that the packaged juices market in India is still evolving. As

there are many national and international brands on the verge of succeeding andexpanding further into the field, new entrants can also cash in on this opportunity by

positioning/promoting packaged and bottled fruit juices as part of the consumers

daily diet. Simultaneously, it is critical to ensure affordability for consumers, while

maintaining the hygienic aspects and quality of products throughout the year.


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Coming to the non alcoholic beverages section, we can say, traditionally, theIndian life style has a predilection for fresh fruits and vegetables or those

processed at home. There is a sea change. People, are now increasingly going infor fresh fruit vending from kiosk fountains which produce instant juices fromfresh fruits in the presence of the consumer. Fast expanding middle classpopulation that is currently around 340 Million, increased urbanization andrising disposable income are some of the major reasons contributing to this

change. Besides this, growing health consciousness among Indias youngpopulation has brought about a revolution in the Indian non-alcoholic drinksmarket. Among the fruit juices beverages are Pepsis Tropicana, nectars (DabursReal) and fruit drinks (Frooti and Slice).All these are real, reconstituted from fruit

pulps or concentrates. The leading fruit juice brands include Real, Onjus,Tropicana, Frooti, and Jumpin. The branded fruit juices segment is growing ataround 11 per cent annually. Similarly the bottled water market is growing at a

rapid rate of around 20 per cent a year. Multinationals, Coca-cola, Pepsi, Nestle,Parle Export, Parle Agro and others are trying to grab a significant share of themarket. The leading bottled water brands include Bisleri, Kinley, Aquafina,Himalaya, Hello, Perrier, Golden Eagle ,Penguin mineral water etc .to name a

few.


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Indian Beverages :

Alcoholic

Non-alcoholic Tea, Coffee etc.

Carbonated soft drinks

Bottled fruit based beverages

Other Beverages

Very Little in Organised Sector


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These days people are turning more health conscious. Because of this the non-carbonated

beverage segment has become one of the fastest growing and most exciting businesses at

the moment.

Manufacturers are offering the consumers better tasting, more healthful alternatives.

Newer products that have efficacious amounts of nutritional ingredients are being developed

by the manufacturers. While all segments of the beverage market are evolving, the growth

seems to be directed more towards healthy, light and low-calorie drinks.

Another key trend in beverage industry is the increasing preference for healthy products.

Consumers have become increasingly aware of health and fitness-related issues. Additionally,

due to greater disposable incomes, particularly in urban areas, consumers are seeking

healthier beverages even if they are relatively more expensive. This trend is so far restricted

to urban consumers whilst for the rural consumer; manufacturers continue to focus on

offering economy pack sizes. A number of young Indians indulge in outdoor sports and exercise regularly, which has

increased the demand for Satiety-inducing beverages such as dairy-based drinks. Since the

year 2007, the country has seen numerous product launches in the field of nutraceuticals/

functional foods and beverages that cater to distinct consumer brackets and ages. Indian

health drinks market is still in its infancy due to the lack of awareness among the population.

In value terms, the health food drink market is around Rs 1, 400 crore and in volume terms

around 65,000 tons per annum.


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At present, the Indian packaged juices market isvalued at Rs 1100 crore (US$ 177.78 million) andis projected to grow at a compound annual

growth rate (CAGR) of 15 per cent over the nextthree years.

Dabur India Ltd is the established leader,accounting for 54 per cent market share through

its Real fruit juice brand, followed by PepsiCoIndia with a 2530 per cent market share throughits Tropicana juice brand.


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Expecting fast growth in value-added dairyproducts such as milk, foreign entities havestarted looking at India as a dairy product

market. Packaged milk segment in India isprojected to grow from US$ 7.76 billion to US$32.9 billion by 2030, registering an annualgrowth of 8 per cent. The hot beverages

market in India is also surprisinglyconcentrated with the top 10 companiesaccounting for 65 per cent of the market.


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Why people drink beverages ?

Quench the thirst

Health benefits of water Medicinal benefits of beverages


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Health Benefits of Drinking Water Lose Weight

Regulates Body Temperature

Natural Remedy for Headache

Look Younger with Healthier Skin Better Productivity at Work

Better Exercise & Relieves Fatigue

Helps in Digestion & Constipation

Less Cramps & Sprains

Good Mood Reduces Risk of Cancer, CVD, Respiratory Infection, Arthritis

Helps Distribute Nutrients to Tissues

Detoxifies & Reduces Risk of Kidney Stones

Beverage Industry - India

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