CRISIL SME Tracker: Scale-up recipe eludes branded-food MSEs

CRISIL's analysis of over 150 rated MSEs in the branded foods segment shows that many have created strong local brands by catering to local tastes while maintaining good hygiene and quality

Micro and small enterprises (MSEs) in the branded foods segment need significant improvement in capital position and talent to scale up.

Revenues in the packaged foods industry are estimated at Rs 1.3 trillion and are highly fragmented, given the diversity in cuisine and flavours across regions.

The sector is expected to log a compound annual growth rate (CAGR) of 15-18 per cent in the next three years, spurred by rising disposable incomes, urbanisation and an increase in the population of working women.

That is a material opportunity for branded foods, which account for two-thirds of the packaged foods market. 

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