RJ's Cream Bell heads west; to focus on premiumisation

To expand its reach firm has added 12,000 selling points and entered the Gujarat market this year

Cream Bell ice-creams, the Rs 500-crore Ravi Jaipuria-led company, is eyeing expansion in western markets such as Gujarat. It is also working on more innovative and premium products.

Cream Bell, which started in 2003, is the fifth largest in the sector, with a strong foothold in the northern and eastern markets, 40 per cent of its sales. This year, it added 12,000 sale points and entered Gujarat. “We launched in Ahmedabad in March and are preparing to soon enter Baroda and Surat. Gujarat is considered the Mecca of ice-creams in India. However, since all the major established players were present there, (it took us) three years of deliberation,” said Nitin Arora, chief executive.

The company was holding back this decision to increase penetration in the western markets as it does not have a localised production unit there. “After entering Gujarat, we are present in all states except Kerala and Tamil Nadu,” said Arora. One of the three production units is in Goa, catering to Maharashtra, Andhra Pradesh and Karnataka. It is dominant in central and western Uttar Pradesh, where its “flagship” plant is situated.

Another barrier in venturing to new territories is the dismal state of power supply in those regions. “We are currently present in 240-250 towns across the year. And, focusing on increasing our penetration in those,” said Arora. The plan is to add 15,000 sale points in 2016, to the current strength of 78,000.

Cream Bell, apart from focusing on presence, is also working on new products. It had launched 14 variants this year and five more this festive season. “We want to be a full-range player, unlike many others who launched their separate brands for premium products,” said Arora. “Consumers are opting for premium products and we will be introducing 15 to 20 new products every year.” It had ventured into the premium category two years earlier with 125 ml cups priced at Rs 50 each.

And, although a subdued summer made the company cut its revenue estimate for 2015-16, Arora is confident of growing 15-16 per cent this year, from Rs 500 crore a year before.