The Indian incense stick industry is worth Rs. 2400 crore annually and is growing at 10% per year. It is a highly fragmented industry with over 200 players and 400 brands. The top five players account for 20% of the market. Exports are worth Rs. 275 crore annually. Most production is done by cottage industries and NGOs using handcrafted methods. Raw materials like bamboo charcoal are sourced locally. ITC is the largest player with 8% market share, followed by Mangaladeep with 5%. The industry is dominated by local players and has low customer loyalty to brands.

1. INDIAN INCENSE STICK INDUSTRY
MARKET SURVEILLANCE REPORT

2. Industry Overview
 India Agarbatti Market Size is worth Rs 2400 cr – 70 Billionn sticks
~Bamboo – 35,000 mts/annum
~Rawbatti – 60,000 mts/annum
 Mostly hand crafted by cottage industries and NGOs in India
 Growing at a rate of10% p.a
 Exports- Rs 275 cr
 Use of Incense
~India : Worship
~Overseas : Ambience creation Aroma Therapy
Kartikeya Verma

3. Agarbatti Industry
Highly Fragmented Industry
Market Products
 Highly Fragmented 200 players
with 400 brands
 Industry dominated by Local
Players
 Top five players account for 20%
value
 Top five pack /price combinations
account for only 25% of the industry
 Large number of fragrances are
marketed
Kartikeya Verma

4. 800 crores
Export
200 crores
Domestic
1000 crores
The Market
2400
crores
1994 2010
Manufacturing Units
800 Registered 3000 Unregistered 400 Exporters
Unorganised sector and highly fragmented
Kartikeya Verma

5. Export values
0
500
1000
1500
2000
2500
3000
3500
4000
Milliontons
EXPORT
2005-06 2006-07 Series 3
0
5
10
15
20
25
30
Rs.Inbillions
PROFIT
1989-90 1993-94 2003-04 2004-05 2005-2006
Kartikeya Verma

6. Export Market
4%
7%
4%
15%
3.5%
Kartikeya Verma

7. Consumption Patterns
Urban
39%
Rural
61%
Urban
Rural
 Low involvement product
 No brand loyalty
 Agarbattis are low involvement products whose
purchases are often impulsive
 Purchases based on packaging, fragrance and pricing
Kartikeya Verma

8. Cost Structure
Masala
10%
Non-masala
60%
Packaging &
Marketing
30%
Cost Distribution  Masala 10%
 Non-masala 60%
 Packaging & Marketing
30%
2%
• Raw Bamboo
8%
• Masala /Non-Scented Agarbatti
30%
• Perfumes
30%
• Packaging Material
20%
• Marketing
10%
• Miscellaneous
Kartikeya Verma

9. Marketing Approach
 Superior fragrance experience [Conforms to IFRA norms]
 Consistently superior product experience
 Inputs for Priority Markets
 Attractive & differentiated packaging – Fragrance locked
 Product Quality rating Systems
 Brand Health Tracker
 A superior fragrance development and selection procedure
DEVELOPING BRAND PREFERENCES
Kartikeya Verma

10. Current market player
ITC
Mangaladeep
N. Ranga Rao & Sons
The Incense Group
 Launched in 1948
 Market leader in India with
Current market share 8%
 Exports to 40 countries
 Its Brand
 Cycle agarbatti
 Lia agarbatti
 Flute agarbatti
 Rhythm agarbatti
 Launched its brand in year 2004
 ITC the second largest player with
market share of almost 5%
 Fastest growing brand
 ITC signed a MOU with Orissa and
Tripura govt. for sourcing raw
materials
 It provide employment for 10000
women in rural regions
2.1.
Others old Brands
Moksha Agarbatti
 Cofounded in year 1966
 Bangalore Based
 Offer 35 fragrance
Nandi Agarbatti
 Established in 1936
 Bangalore based
 Production capacity
1000 tons
Hem Incense
 Established in 1983
 Production facilities at
Mumbai & Bangalore
 Bulk Exporter
Devdarsadan
 Established in 1954
 Manufactures Dhoop,
Agarbatti & Hawan
Samagri
Kisan
 Established in 1998
 Located in Sujabad,
Parao, Varanasi
Kartikeya Verma

11. ITC Incense Business Value Chain
Bamboo
Charcoal Jiggat
Raw Batti
rolling
Perfuming
Packaging
Marketing &
Distribution
NGOs
SSIs
ITC Limited
Kartikeya Verma

12. Raw Incense NGO Based Supply Chain
ITC Limited
Vendors
NGO
Women in
Different
Villages
Spread
over and
of more
than 100
Sq. Km
Order
Supplies
Raw
Material
Supply
Finished
goods
Brought
Back
Kartikeya Verma

13. Thank you
Kartikeya Verma