Ds Group Changing Track, From Gutka To Foods Products

The Rs 600-crore pan masala and chewing tobacco major DS Group is looking for a blockbuster food product that will fetch it a turnover of almost Rs 500 crore. "We will freeze the product within the year," DS Group vice-president Ashok K Aggarwal said.

At the moment, food products including Catch spices, Pass Pass mouth freshner and Catch spring water account for a little over 10 per cent of the group's turnover. The rest is made up by chewing tobacco, pan masala and gutka (a mix of chewing tobacco and pan masala).

"Within two years, our turnover from the foods business will be higher than the other business," Aggarwal added.

For this purpose, the group is currently studying all staple food items. "The important thing is that there should be a good availability of the raw material and the consumer should be interested in switching over to a branded variant of the product," Aggarwal said, adding that the product would be launched under the group's existing Catch brand.

Also, Aggarwal said, the product should be such that it is consumed throughout the year. He ruled out getting into products such as pickles, soft drinks, jams and dairy products.

Aggarwal disclosed that the group, in association with market research agency MODE, had looked at the option of getting into tea. "But we decided against it as it is a very complex business. Every state requires a different tea to suit different tea drinking habits," Aggarwal said.

Meanwhile, the group has drawn up plans to expand its existing foods business. The turnover of Pass Pass mouth freshner is sought to be raised from Rs 40 crore to Rs 100 crore this year through new packaging in flip-tops which, the group hopes, will improve its reach. The group also plans to raise its spices business from the existing Rs 20 crore to Rs 100 crore during the year by launching new products at the same prices as other brands in the market.

Explaining the reason for the shift, Aggarwal said that the growth prospects in the other business are not too good. "While the pan masala and chewing tobacco business are not growing, the group has a limitation in the gutka business. Because of high excise, the business has been captured by the players in the unorganised sector. Thus, we are looking for growth in the foods business."