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| Parag Milk Foods: Way to go |
| Arunima Mishra / Feb 13, 2012, 00:24 IST |
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The Indian cheese story has come a long way — from one that once used to be only about Gujarat Co-operative Milk Marketing Federation’s Amul, cubed, canned and now sliced, it now includes a bunch of new players, both national and international. Increasing competition has also meant players are looking at newer avenues for growth. Take Maharashtra-based Parag Milk Foods, which is eyeing the institutional segment with keen interest.
“We really don’t have focused competition in the Institutional segment,” says Rahul Akkara, vice-president (marketing), Parag Milk Foods. “Besides a handful of organised players, this segment is serviced largely by unorganised players who have been in the business for a while now.”
Cheese constitutes less than 1 per cent of the Indian dairy industry, and the Rs 500-crore Indian cheese market is growing at a compounded annual growth rate of 15-20 per cent, according to management consulting firm Technopak. Approximately 45 per cent of India’s total milk production is sold as liquid milk; the rest goes into production of value-added products such as milk powders, whiteners, condensed milk, butter, cheese, ice cream and ghee. (Indian milk production touched 116 million tonnes in 2011, according to Technopak.)
In cheese, the top local players in the institutional segment are Amul, Paras, Parag, Madhusu- dhan, Umang, Golpaljee, Param and Shreejee. In the retail segment, Indian players like Amul and Paras compete with the likes of Kraft (imported) and Britannia. With Indian consumers taking to Western snack foods like burgers and pizzas, the cheese story can get happier in days to come.
According to Parag, its brands Gowardhan and GO cheese have cornered about 50 per cent of the institutional sales market already and about 20 per cent of the retail segment (general plus modern trade). Akkara says, “Our success can be attributed to our state-of-the-art manufacturing facility.” According to the company’s website, its plant in Pune is one of the only two facilities in Asia with ultra-high temperature (UHT) processing technology. The equipment, imported from Stephan Machinery Germany, pioneers in cheese processing equipment, allows the UHT treated cheese to be stored in ambient condition without refrigeration up to a period of six months even in the tropical climates.
Parag is now drawing up a roadmap to address markets in India where it doesn’t have much of a presence. Its centralised cheese plant at Manchar, Pune, is one of the biggest as well as the most modern plants in Asia and has a capacity of 40 metric tonnes of processed cheese every day. “We have a second plant at Palamner in the Chittoor district of Andhra Pradesh and with this the access to the southern markets has become quicker,” says Akkara.
The 80,000 sq ft Palamner facility, set up in 2010 to manufacture milk and related products, started with an installed capacity of processing of 5 lakh litres of milk per day. Besides milk, the focus of production is on value-added products such as ghee, curd, cheese etc. “As we scale up our distribution and reach out to newer markets, there would be need for more sustained and strategic advertising and brand-building initiatives,” says Akkara. “We will also focus on below-the-line initiatives to induce trials,” he sums up.
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