Market Research Report : Nutraceuticals market in India 2012


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The healthcare industry in India is showing great progress. There has been considerable increase in spending on healthcare backed by the growing purchasing power of individuals. Moreover, with a lot of importance being given to preventive medication, the nutraceuticals market in India is set to flourish. It is one of the booming markets in India. Predominantly vitamins and minerals derived from oral pills were used for curing certain diseases and ailments. People today are becoming more prone to consume immunity enhancing food supplements and wellness related products. This is promoting the growth of the industry with players diversifying into production of various new varieties of products. Further assistance from the government and increasing demand from consumers will fuel growth in this market.

The report begins with an introduction to the Indian nutraceuticals market and its classification on the basis of the ingredients and benefits incurred from them. This is followed by the market overview section which provides the market size and growth as well as the market share of the various segments in the market, namely, functional foods, dietary supplements and functional beverages. A detailed description of each segment in the market along with the dominant products in the particular category has also been provided. Focusing on one the major sub-segments, an overview of the probiotic market in India has been included. This segment has been highlighted owing to the fact that it is one of the most promising categories under the nutraceutical market and has huge growth potential in the near future with growing interests of players. The genesis of probiotics has been highlighted showing the types dominant in India and the key therapeutic benefits derived from them. This section also contains information regarding the market size and growth of probiotics in functional foods in India as well as the key segments and the active players in this space.

This is followed by an analysis of the drivers leading to growth in the market. This includes increasing shift towards preventive therapies, increasing disposable income, increase in healthcare spending, increasing shift towards self-medication, changing demographics, growth in pharmacy and wellness related retail chains and favorable pricing environment. The key challenges to the market include lack of standardization, marketing and distribution challenges, high pricing and lack of awareness. Several trends have also been identified in the market and this has been provided in the next section. The key trends include fortified foods, ayurvedic nutraceuticals, foreign tie-ups, players educating consumers, encapsulation, and cosmeceuticals and nanoceuticals. A section on government regulations in the industry has also been included.

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Market Research Report : Nutraceuticals market in India 2012

  1. 1. Nutraceuticals Market – IndiaMarch 2012
  2. 2. Executive Summary  Market valued at INR b bn in 2011 and is estimated to reach INR f bn in 2015 Market  Comprises of three segments, dietary supplements, functional foods and functional beverages   India accounts for a mere m% of the total world market for nutraceuticals  Probiotics in India generally comes in two forms : Drugs and Packaged foods and beverages Probiotic   Major pharmaceuticals companies have become active in this space and are devising newer  Market drugs and products, however current drugs are predominant in the area of gastroenterology    Players are also devising packaged products like jellies, RTE cookies and smoothies Drivers: Challenges: – Increasing shift towards preventive therapies – Lack of standardization – Increasing disposable income – High pricing Drivers &  – Increase in Healthcare Spending – Lack of awarenessChallenges – Increasing shift towards self‐medication – Marketing and distribution challenges – Changing Demographics – Growth in pharmacy and wellness related retail chains – Favorable pricing environment  Fortified foods  Initiatives by players to educate consumers Trends  Ayurvedic nutraceuticals   Encapsulation  Foreign tie‐ups  Cosmeceuticals and Nanoceuticals Major Public Players Major Private PlayersCompetition Company 1 Company 3 Company 5 Company 7 Company 2 Company 4 Company 6 Company 8 NUTRACEUTICALS MARKET IN INDIA 2012.PPT 2
  3. 3. •Introduction•Market Overview•Probiotic Market •Drivers & Challenges•Trends•Government Regulations•Duties and Tax Structure•Industry Associations & Bodies•Competition•Strategic Recommendations•Appendix NUTRACEUTICALS MARKET IN INDIA 2012.PPT 3
  4. 4. Increasing shift towards preventive therapies and increasing  disposable income has led to a growing market  Market Overview Market Size and Growth • India accounts for only m% of the world  INR bn nutraceuticals market 250 • Nutraceuticals market in India is growing at a very  f 200 x% e fast pace and is expected to be almost double in 20‐‐ d 150 c from its size in 20‐‐ a b 100 • Increasing shift towards preventive therapies and  50 increasing disposable income is driving growth in this  sector 0 2010 2011 2012e 2013e 2014e 2015e • Several pharmaceutical companies are entering this  space, realizing that nutraceutical products can be  supplementary products to their therapeutic  Market Segmentation (2011) products Segment 1 Segment 2 • There are more Indian players than multinationals in  the market as it is a relatively low technology section  compared to pharmaceuticals u • Probiotics is one of the most emerging and nascent  v Segment 2 can be further  segments in this market with increasing consumer  divided into Segment 2a and  acceptance and greater player attention expected to  Segment 2b  drive its growthSource: NUTRACEUTICALS MARKET IN INDIA 2012.PPT 4
  5. 5. Drivers & Challenges – Summary  Drivers Increasing shift towards preventive  therapies Challenges Increasing disposable income Lack of standardisation Increase in Healthcare Spending Marketing and distribution challenges Increasing shift towards self‐ High pricing medication Changing Demographics Lack of awareness Growth in pharmacy and wellness  related retail chains Favorable pricing environment NUTRACEUTICALS MARKET IN INDIA 2012.PPT 5
  6. 6. Trends – Summary Fortified Foods Ayurvedic Nutraceuticals Foreign Tie‐ups Trends` Players Educating Consumers Encapsulation Cosmeceuticals and Nanoceuticals NUTRACEUTICALS MARKET IN INDIA 2012.PPT 6
  7. 7. Major Public Companies – Summary Size of the Bubble represents Market Capitalization in INR bn Net Profit 18 16 h 14 12 10 8 f 6 d 4 c b 2 g a 0 ‐2 ‐4 ‐6 ‐8 ‐10 e ‐12 Revenue 0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 95 100 105 Company 1 Company 2 Company 3 Company 4 Company 5 Company 6 Company 7 Company 8Source: Note: All figures are in INR mn for FY 2010 NUTRACEUTICALS MARKET IN INDIA 2012.PPT 7
  8. 8. Public: Domestic Company – Company 1 (1/3) Company Information Offices and Centres – India  Corporate Address Tel No. Fax No. Website Year of Incorporation Ticker Symbol Stock Exchange Products and Services Head Office Category Products/Services Segment 1 Product 1, Product2 Key People Segment 2 Product 1, Product 2, Product 3 Name Designation Segment 3 Product 1, Product 2, Product 3 Person A CEO & Executive Director Product 1, Product 2, Product 3,  Person B Chief Financial Officer Segment 4 Product 4, Product 5 Person C Executive Director of Operations Person D Company SecretarySource: Company Website; Annual Reports; Databases  NUTRACEUTICALS MARKET IN INDIA 2012.PPT 8
  9. 9. Public: Domestic Company – Company 1 (2/3) Financial Snapshot Key Ratios Total Income Net Profit / Loss y‐o‐y change  Particulars  2011 2010 2009 2008 INR bn INR bn  (2011‐10) d250 c2 6 Profitability Ratios40 b2 Operating Margin a2 4 Net Margin30 Profit Before Tax Margin20 c1 d1 b1 2 Return on Equity10 a1 Return on Capital Employed 0 0 Return on Working Capital 2008 2009 2010 2011 Return on Assets Financial Summary  Return on Fixed Assets Cost Ratios • The company incurred a net profit/net loss of INR X mn in FY 20XX,  Operating costs (% of Sales) as compared to net profit/net loss of INR Y mn in FY 20YY Administration costs (% of  • The company reported total Income of  INR XX mn in FY 20XX,  Sales) registering an increase/decrease of X per cent over FY 20YY Interest costs (% of Sales) Liquidity Ratios • The company earned an operating margin of X.X per cent in FY 20XX  Current Ratio an increase/decrease of X.X percentage points over FY 20YY Cash Ratio • The company reported debt to equity ratio of X.XX in FY 20XX, an Leverage Ratios increase/decrease of X.X per cent over FY 20YY Debt to Equity Ratio Debt to Capital Ratio Key Financial Performance Indicators Interest Coverage Ratio Indicators Value (dd/mm/yyyy) Efficiency Ratios Market Capitalization (INR) Fixed Asset Turnover Asset Turnover Total Enterprise Value (INR) Current Asset Turnover EPS (INR) Working Capital Turnover PE Ratio (Absolute) Capital Employed TurnoverSource: Annual Reports; Netscribes Analysis; Databases  Improved Decline NUTRACEUTICALS MARKET IN INDIA 2012.PPT 9
  10. 10. Public: Domestic Company – Company 1 (3/3) Key Business Segments Key Geographic Segments Segment 1 Segment 3 Segment 5 Country 1 Segment 2 Segment 4 100% Country 1 is the only  a1% a2% a3% a4% geographic segment in which  Company 1 has been  c1% c2% c3% c4% e1% e2% e3% e4% operating for the last four  b1% b2% b3% b4% years d1% d2% d3% d4% 2008 2009 2010 2011 2011 Business Highlights Description  News • Has 3 major strategic business units, namely, Business Unit 1, Business Unit 2 and  Business Unit 3 Overview • Markets its products in over 60 countries • Has 50 C&F agents, more than 5000 distributors and over 2.8 mn retail outlets in Country  1 • Its nutrition product range includes products such as Product 1, Product 2 and Product 3 Nutraceutical Business • Is setting up a manufacturing plant in Country 2 to manufacture Product 3Source: Company Website; Netscribes Analysis; Databases  NUTRACEUTICALS MARKET IN INDIA 2012.PPT 10
  11. 11. Thank you for the attentionThe Nutraceutical Market – India report is part of Research on India’s Healthcare Series.For more detailed information or customized research requirements please contact:Phone: +91 33 4064 6214E‐Mail: sales@netscribes.comFollow us on:About NetscribesNetscribes is a knowledge‐consulting and solutions firm with clientele across the globe. The company’s expertise spans areas of investment & business research, business & corporate intelligence, content‐management services, and knowledge‐software services. At its core lies a true value proposition that draws upon a vast knowledge base. Netscribes is a one‐stop shop designed to fulfil clients’ profitability and growth objectives.Disclaimer: This report is published for general information only. Although high standards have been used in the preparation, “Netscribes” is not responsible for any loss or damage arising from use of this document. This document is the sole property of Netscribes and prior permission is required for guidelines on reproduction. NUTRACEUTICALS MARKET IN INDIA 2012.PPT 11