This document provides an overview of the processed food industry and food processing machinery industry in India. It discusses key segments of the food industry including fruits and vegetables, dairy, grains, and packaged foods. It outlines the size and growth of the processed food market in India. It also analyzes the competitive landscape and discusses major players in various industry segments. The document concludes by discussing opportunities and challenges for the food and food processing industry in India.
3. Processed Food Industry in India
Processed Food Distribution Formats in India
Processed Food Industry Overview
Competition Analysis
Developments in Processed Food Industry
Regulatory and Custom Duties Analysis
Food Processing Machinery
Industry Overview
Major Target Industries for Machinery Manufacturers
Customer Concentration
Cold Storage Overview
Packaging Machinery Overview
Conclusion and Recommendation
5. WHY PROCESS FOODS?
1. EXTEND SHELF LIFE
2. MAINTAIN SENSORY PROPERTIES
3. MAINTAIN OR IMPROVE NUTRITIVE
PROPERTIES
4. ENSURE SAFETY
5. MAKE MORE CONVENIENT
6. ECONOMIC VALUE
6. BUSINESS MODEL
• Organic Food / Wellness : Foods which are not
processed using industrial solvents or synthetic
additives.
• Ready To Cook / Ready to Eat : Commercially
prepared ingredients / food to optimise ease of
consumption.
• Cold Pressed Juices / Salads : Refers to juices that
use a hydraulic press to extract juices from fruits
and vegetables.
• Functional Drinks : Sports drinks, energy drinks,
probiotic, alkaline water.
7. COMPANIES OVERVIEW
• Organic India, Just Organik, Nimble
Organics.
• MTR, Mc Cain, Knorr, Sumeru.
• Raw Juices, Just Pressed, Juice Up,
Salad days.
• Gatorade, Body Fuelz, Unived, Red
Bull, Yakult.
8. SERVICES
• Discovery Services : Helps find nearby
restaurants and food points based on
selected criteria.
• Delivery Services : Helps in delivery of food
from nearby restaurants and food
cooperatives.
• E-Commerce Services : Helps purchase food
products online.
• Boxed Meal Services: Subscription or random
selection based home – cooked food delivery
services
10. COMPANIES OVERVIEW
• Cremica: Manufacturer of snacks.
• Bikaji Foods Int. Ltd: Manufacturer and wholesale
snacks.
• VKL Seasonings: Seasonings.
• Hari on Biofoods Pvt. Ltd: Vacuum dried fruits and
vegetables.
• K2B: Vacuum Dried and Freeze Dried Food Products
• Mitthi Foods: Freeze Dried Food Products.
• Bush Foods: Rice Processing.
11. Food Processing Policy 2015-2020
o Power Subsidy:
• Power subsidy is provided to eligible units on power
tariff paid by the unit on actual units consumed for a
period of 5 years from the date of commercial
production.
• 25% of the cost payable to State Power Distribution
Company for drawl of power line to the premises of
the unit including the cost of transformer is subsidized
to Micro and Small industrial units
o *Capital Investment Subsidy: Capital Investment
Subsidy of 30% on the investment in plant and
machinery and the limit for automatic approval of
subsidy at this rate is INR 1.5 Cr. Per unit.
12. o *Interest Subsidy:
o Working capital - Interest subsidy is made
available at 3% on working capital loan under
NEIIPP, 2007
o Capex: Interest subsidy is provided to Micro
industrial units @ 30% of the amount of interest
paid on term loan to Bank/Financial Institutions for
a period of 5 years from the date of commercial
production subject to a ceiling of Rs. 1.00 lakhs
per unit/year
o NABAR Scheme: Loans to entities in Mega Food
Park to be available at 9.5% -10% p.a.
13. o Transport Subsidy: 90% of the
transportation cost of raw materials and
finished goods to and from the location of the
unit and the designated rail head (for
movement of goods within NER, the subsidy
is 50%) – for a period of 5 years from
commercial production
o License Fee Subsidy: The fees payable for
obtaining BIS/ISO/FPO/AGMARK and fees
payable for getting the technical know-how
from recognized research laboratory /
institutions like CFTRI, CIPET etc. by eligible
units is subsidized to the extent of 50%
14.
15.
16. Food HabitsFood Habits
India is a culturally rich & diverse nation having varied lifestyles,
religions, art, culture, attire & food.
Weather & topography vary widely with region:
North: Closest to the Himalayan range, hilly regions with extreme
weather conditions; high fertility area with high wheat production
West: Arid areas of Rajasthan and Gujarat – which are dry and hot
through most of the year. In some coastal areas of Maharashtra, fish is
the staple diet
South: Temperate climatic condition all through the year; high rice
production & consumption area
East: Hilly regions with varying weather conditions; East is the poorest
regions of the country
17. Indians take food very passionately
Mealtimes are considered as occasions and time for
families to get together and spend quality time.
Fresh cooking is essential in most Indian homes,
with limited preference for stocked food
Most meals comprise of several dishes ranging from
staples like rice and breads, to meat or vegetables,
rounded off with a dessert
18. Regional Food Habits – NorthRegional Food Habits – North
North Region – Madhya Pradesh, Uttar Pradesh, Haryana, Punjab,
Himachal Pradesh, and Jammu and Kashmir
Wheat-breads are the staple diet which accompany all meals
Largely meat-based diet characterized by tandoori-style cooking
methods
Fair amount of cooking is done using deep frying in oil
High consumption of milk and milk-based products
High consumption of fresh fruits such as apples, cherries, plums
and strawberries which are unique to this region due to its cooler
climate.
Increasing number of households are shifting toward replacing
traditionally made food items such as curd and cottage cheese with
packaged items (packaged curd or cottage cheese)
19. Regional Food Habits – SouthRegional Food Habits – South
Southern India – Andhra Pradesh, Karnataka, Goa, Tamil Nadu, and Kerala
Primarily vegetarian population barring coastal areas where fish is a
staple diet
Rice is abundant & appears in almost every dish during a meal & are eaten
in multiple forms
Tamarind and coconut form the base for most preparations, with most
curries based in coconut gravy
Hot spicy foods are cooked, with chettinad cuisine being one of the most
fiery
Food is often eaten on banana leaves
Major shift is seen in people moving towards ready-to-use packaged food
items for idlis and dosas, rather than going through the relatively longer
process of preparing the batter in-house
20. Regional Food Habits – WestRegional Food Habits – West
Western India – Rajasthan, Gujarat, and Maharashtra
High demand of dairy products, including yoghurt, buttermilk,
cow's milk, and goat's milk
Rice is the staple food grain
Goan cuisine is dominated by rice, coconut, fish and seafood
Gujarati cuisine is largely vegetarian, with a hint of sugar or
jaggery in every preparation
Peanuts and coconut are widely used
Other popular cereals include gram flour, bajra and corn
21. Regional Food Habits – EastRegional Food Habits – East
Eastern India - Orissa, Bihar, West Bengal, Assam, Meghalaya,
Tripura, Mizoram, Manipur Nagaland, and Arunachal Pradesh
Relatively more simplistic and less elaborate food
Characterized by a variety of different types of rice
Predominantly fish eating population in coastal areas
Common practice to eat steamed food, e.g.: momos
Curries include lot of poppy, mustard and cumin seeds, cumin
seeds
World famous for sweets
22. Changing Trends for FoodChanging Trends for Food
Growing middle class population and household incomes are
driving people to spend more on food
Increasing cases of lifestyle diseases have resulted in shift
towards healthier food options such as fruit juices, pro-
biotics, cereals and oats
Shift in consumption preferences & increasing demand is
driving the food companies to introduce innovative products
such as digestive biscuits, fortified dairy products, etc.
23. Increased demand for processed & packaged
products with high shelf-life
Willingness to pay a premium for value-added
products such as cheese, butter, flavoured milk
Overall change in palate and preference for newer
varieties of food due to western influence
24. Key Markets
• West
Being the key port region, majority of players have a
presence in this region
Market is led by Modern retail channels and HORECA
segment, also has a significant grey channel
• Product Preference
Biggest market for candies and confectionary
Key market for fruit based flavours, especially
strawberry and orange
25. • North
Second most important market
Market led by wholesalers, but large
volume of sales through grey channel;
large number of Modern Trade food &
grocery outlets
• Product Preferences
Wheat based products
26. • South
Highest penetration of Modern Trade, having
high sales per outlet
High levels of consumer awareness
• Product Preferences
Biggest market for chocolates and bakery
products
Highest incidence of diabetic population in
India leading to consumer awareness about
healthy breakfast choices
Fastest emerging market for RTE/RTC foods
27. • East
Lowest sales volume by channels
High presence and consumption of
mass/regional products
• Product Preferences
Preference for non-oily and less spicy
food products
Beef and pork products are heavily
consumed
29. Railways and Airlines
Hotels, Restaurants and Catering
(HORECA)
Canteen Store Department
Others (Schools, Colleges, Offices and
Hospitals)
30. Railways and Airlines
Work on contract based arrangements
Contracts are based on volume & price
negotiations/tenders
CSD Canteens
CSD (Canteen Stores Department), run by the
Ministry of Defense catering to the Armed forces
Assortment of food and non food products at
subsidized rates and differentiated packaging
Work on Tender based arrangements
31. Hotels
Indian Hotel and Restaurant industry is growing @
20-25% due to increase in foreign tourists and
business-related travel
Multiple consumption points (Breakfast Buffet,
Restaurant, Gym, Bar, Mini-bar)
Others (Schools, College, Offices & Hospitals)
Products such as yoghurt, juices etc.. are gaining
popularity on back of its health proposition
Companies are tying up with institutions such as
Schools, Hospitals, Offices etc. to club their
products along with meals
32. Modern Trade FormatsModern Trade Formats
Large retail store offering wide range of products and
brands
Average size between 4,000 – 10,000 sq. mtr.
E.g. Big Bazaar, Spencer Hyper etc.
Smaller version of a Hyper marts with a average
size of 300 to 1,000 sq. mtr.
Mainly offers food items like groceries along with
non food items
E.g. – Food Bazaar, Reliance Fresh etc.
33.
34.
35.
36.
37. Processed Food Industry
Overview
Varied agro climatic zones
2nd
largest arable land (161 M ha) in the world
Largest irrigated land (55 M ha) in the world
Largest producer of Wheat, Pulses & Milk
Largest producer and exporter of Spices
Second largest producer of Tea, Rice, Fruits & Vegetables
Second largest producer of Sugarcane
Largest exporter of the world's best rice (Basmati)
Third largest producer of Coarse grains and Edible Oilseeds
38. Industry SegmentationIndustry Segmentation
The Indian Food and Food Processing industry
(FPI) primarily comprises of the following
segments
Fruits & Vegetables (F&V)
Dairy
Meat, Poultry and Marine
Grains and Seeds
Packaged Foods (including Beverages)
39. Food Processing Industry –Food Processing Industry –
Market SizeMarket Size
The size of the processed food sector in India was approximately
US$105 billion in 2011
Includes both the organized and unorganized sector where organized
forms 50-55% of the overall market
Sector is growing by 13-15%, but is expected to grow by ~25% in the
coming years to reach size of US$530-550 billion by 2020
Within the food processing sector, segments like meat, and packaged
foods are expected to witness high growth rates
Historically, food processing industry has contributed around 1.5% to
Indian GDP
40. Food and Food ProcessingFood and Food Processing
Industry in IndiaIndustry in India
• Strength
Huge domestic consumption market
Large production base of raw material
Breadth in crop base offering scope for
varied processing activities
41. Food and Food ProcessingFood and Food Processing
Industry in IndiaIndustry in India
• Weaknesses
Inadequate infrastructure facilities
High upfront capital investments
Lack of adequate quality control & testing protocols
Large number of intermediaries resulting in
inefficient supply chain and increase in prices
Seasonal variability of crops
Low packaging aesthetics
42. Food and Food ProcessingFood and Food Processing
Industry in IndiaIndustry in India
Opportunities
Government incentives (priority sector, tax relief,
R&D support, etc)
Increasing western influence on Indian palate
(cheese, pasta, sauces, cereals, aerated drinks,
juices, yoghurt, etc) which is driving the demand for
processed foods
Increase in nuclear families and working women who
prefer ready-to-use food items
43. Food and Food ProcessingFood and Food Processing
Industry in IndiaIndustry in India
• Threats
Traditional preference for freshly
cooked food especially in rural areas
Affordability (e.g., processed fruits are
significantly higher than fresh fruits)
High supply chain costs
44. Competition in Fruits &Competition in Fruits &
Vegetables ProcessingVegetables Processing
Processed forms of fruits & vegetables in India
include jams, juices, pickles, chutney, and fruit
concentrates
While the fresh fruits & vegetables market in highly
unorganized with local farmers, wholesalers, and
intermediaries selling directly to customers, the
processed F&V market is somewhat organized with
presence of national and international players
