Godfrey Phillips to diversify into non-tobacco products

Don't want to miss the best from Business Standard?

Leading cigarette maker Godfrey Phillips is expanding business by venturing into non-tobacco products, even as promoter K K Modi group mulls consolidating all different businesses into one single entity.
The company is foraying into mouth fresheners, food & beverages, tea products and confectionery. This was announced during the launch of their cardamom-based mouth freshener 'Pan Vilas Silver Dewz' here today.
"As part of our expansion plans, we are looking into food and beverages, contemporary tea formats, confectionery products as well as new tobacco products," Harmanjit Singh, VP (Corporate Affairs) Godrey Phillips India, said at the launch.
Giving more insight into their future plans, Godrey Phillips Chief Operating Officer (Domestic), Nita Kapoor said the company is eyeing several innovative non-tobacco products such as candies having pan masala flavour.

"Just like cardamom, we are planning to offer clove mixture-based mouth freshener. For confectionery segment, we are planning to launch candies having all flavors of pan masala. Thus, people who don't prefer to eat pan masala, can enjoy similar taste through our candies," said Kapoor during an interaction with the media at the event.
In another major announcement, she said the K K Modi Group, promoter of Godrey Phillips, is planning to consolidate all their businesses into one, just like their competitor ITC.

"K K Modi Group has 9 to 10 different business at present. Just like ITC, we are planning to consolidate all our businesses into one entity after Diwali."

Kapoor said Gujarat was a key market in the pan masala segment. "Gujarat is our key market for both pan masala as well as mouth fresheners. From Gujarat, we are generating Rs 200 crore of revenue per year out of the total Rs 350 crore. With this launch, we are eyeing the vast market during the upcoming festivals of Navratri, Diwali and then Uttarayan."
According to her, the market size of pan masala segment in India is around Rs 250-300 crore and growing at a rate of 14 per cent per year.
"The mouth freshener market is at around Rs 300 crore a year. We are seeing this segment growing rapidly in Western and Northern India. As youngsters are shifting away from pan, we offer them alternative products like mouth freshener."

Asked about expansion plans, especially setting up manufacturing unit in Gujarat, Kapoor said this depends on business.
"At present, we have two factories in Faridabad and Ghaziabad, where we have invested Rs 250 crore. We do have land in Gujarat. Thus, if we do exceptional business, our owners may think of setting up a plant here.