Nestle to gain if Unilever sells Knorr

Knorr is country's largest branded soup player, with 63-64% share in a Rs 300-cr market. Nestle's Maggi has a share of 23%

Unilever’s move to prune its portfolio of food products to navigate the global slowdown could impact its India operations. Unilever has not specified the brands it would sell, but Reuters quoted the CFO as saying most brands to be sold will be from the food business, which includes Knorr soups and Hellmann's mayonnaise.

Knorr, one of Unilever's key packaged food products, is the largest branded soup player in the country, with a share of about 64 per cent in the roughly Rs 300-crore market. Rival Nestle has a share of about 23 per cent with its Maggi range of soups. Nestle, say analysts, will be the likely beneficiary if Knorr makes a departure as it will give Maggi a chance to bid for the top spot in soups.

In response to a mail, a Unilever spokesperson said, “No further detail is available on how the announcements given in London yesterday (Thursday) will affect individual businesses including Hindustan Unilever. The detail will be worked out over the coming months and this includes the topic relating to jobs.” HUL launched Knorr in India 15 years ago.

Since then, it has steadily consolidated its position and extended the Knorr franchise to noodles and ready-to-cook Indian and Chinese products. While soups remain the big driver for Knorr, in noodles and ready-to-cook, it has had to contend with stiff competition from Nestle and ITC.