Wagh Bakri eyes SEZs to install tea-bag making machine

Plans to take brand to 30 cities.

After installing its latest machine to produce non stapled tea bag, Wagh Bakri tea group is looking at installing the machine in special economic zones (SEZs) of Gujarat by next year.

"Once we begin marketing the staple-free tea bags, we plan to instal two or three more machines in various locations. We are looking at installing the machines at SEZs in Viramgam, Bavla and Dholka locations by next year," said Piyush Desai, chairman and managing director of the Wagh Bakri group on the sidelines of the inauguration of IMA-Industria automatic machine (IMA C27), which the company claims to be India's first double chamber machine producing staple-free tea bags. "We procured the IMA C27 machine, which has the capacity of producing 240 tea bags per minute, at a cost of Rs 4.5 crore from Italy," added Piyush Desai.

"The C 27 tea bags will soon be available at stores across the country as well as in UK, US, Canada, Dubai and Japan, besides the European market, which sees 35 million kgs overall export from India . Although there is 5-10 per cent market for tea bags in India, internationally they have more than 70 per cent market share," said Rasesh Desai, managing director of the group.

Talking about the company's expansion plans, Piyush Desai said that currently, the group produces 25 million kgs annually and plans to grow by 25 per cent. "We are looking at 30 major cities in 2009 and by December 2010, we plan to make Wagh Bakri a national brand. We are also launching the brand in Goa next week. The annual turnover of the company is Rs 400 crore and we have a target of Rs 1000 crore for 2009-10," he said.

Elaborating further on the future plans of the company, Pankaj Desai, vice chairman of the group said, "In order to suit the requirements of health conscious consumers around the world, we have conducted a market survey at an investment of more than Rs 4 crore. Our existing sales volume is more than 22 million kgs and we are planning to increase our production capacity by setting up a world class factory at Nadiad."

The national domestic market for tea accounts for approximately 800 million kgs, of which Gujarat holds a market of 65 million kgs. While the packaged tea industry holds a market of Rs 30-32 million kgs, Wagh Bakri holds 70 per cent market of the total market for Gujarat, said Piyush Desai.

The company, which also supplies tea bags to railways and hotels will now be approaching airlines, said Piyush Desai, without mentioning the airlines. He, however, said "We have approached a few airlines but due to lack of suppliers, it did not work out. But something should work out soon," he added.