Nissin To Set Up Second Plant

Indo Nissin Foods, Bangalore-based arm of the $2.3 billion Nissin Foods Products Co of Japan, has decided to expand its operations by setting up its second plant in Harayana to produce Top Ramen smoodles.

The unit will have a capacity of 40 lakh 100 gm packets per month.

The first factory at Bangalore has a similar capacity.

Indo-Nissin Foods recently broke its distribution agreement with Hindustan Lever. Before 1996, Top Ramen Smoodles was distributed by Brooke Bond Lipton India , which was merged with Lever that year.

The arrangement came to an end in March this year with Marico coming in to take the place of HLL as distributors of Top Ramen smoodles.

 

The brand is now a part of Marico healthcare division's processed foods.

Says Pranab Dutta, ceo, healthcare division, Marico, "This is the first time we will be involved in the distribution and marketing of a non-Marico product." Nissin feels it will need the additional capacity to stock more outlets expected to come under its coverage with Marico.

Marico plans to increase distribution coverage to over two lakh outlets to effectively compete with Nestle's Maggi, which sells in 2.7 lakh retail outlets. Under Lever, Top Ramen's coverage had touched only 1.2 lakh outlets.

Nestle had established an iron grip over the market for noodles with Maggi in the late eighties. Top Ramen, in spite of initial failures, garnered a market share of 20 per cent with its `smoodle' ad campaigns.

The change in distribution came about just when Nissin Foods was about to introduce a host of products from its international brand basket into India.

Dutta said "Our prime objective now is to fill the gaps and bring about extensive distribution.The new plant would help us meet further demand."

The unit has been strategically placed in the wheat belt and is scheduled to operational in mid-1999.