Opporutunities in the FoodSector Food of India Part 1
Opportunities in the Food Sector [Part I – Market Size]
December 19, 2016
Opporutunities in the FoodSector Food of India Part 3
Opportunities in the Food Sector [Part III – Government Initiatives]
December 19, 2016

Opportunities in the Food Sector [Part II – Investments]

Opportunities in the Food Sector Part 2 Food of India

Opportunities in the Food Sector Part 2 Food of India

In the previous part, I spoke of the opportunities that the Indian food sector comprises of on today’s time regarding its market size. But the scope of the industry doesn’t halt at the capacity of the market. The next tremendous vigor shown by the market is through the varied interests depicted in forms of investments that the food sector has attracted.

Investments

As per the data depicted by the Department of Industrial Policies and Promotion [DIPP], the industry of food processing in India has received over US$ 6.82 billion worth of FDI [Foreign Direct Investment] within April 2000 to March 2016. The monetary figure sheds light over the tangibility of returns within the food sector. The Confederation of Indian Industry [CII] has forwarded an estimate of about US$ 33 billion worth of investments that the Indian food processing industry would be potentially attracting over the next 10 years. As per their words, this pool of investments wouldn’t just be a big contributor to the nation’s GDP but also it would generate employments for over 9 million person-days. Looking at today’s economy, where new employment generation is of vital importance, the investments as such are immensely required.

A huge foreign deliberation has been shown by Poland, wherein the Ambassador of the Republic of Poland, Mr. Tomasz Lukaszuk, highlighted the rising interest depicted by Polish companies in the Indian food market, particularly the food processing industry. From his words, it is very clear that Polish companies are seeking for opportunities within India to invest in food processing and expand collaboration.

When all is said and done, what speak most loudly are the records of recent past. Therefore, here is a list of major investments that have been within the food sector of India in the recent past:

  • Di Bella is an Australia-based coffee chain which plans to invest about US$10 million for setting up around 20 new retail outlets within Mumbai. By 2017, they plan on entering Bangalore and Delhi as well.
  • KKR & Co. LP is a US-based private equity firm which plans to invest around US& 77.38 million on the dairy company Kwality Ltd. The funds are to strengthen the corporation’s milk procurement infrastructure and grow processing capacity.
  • Henry Ford Health Systems [HFHS] is a US-based health and wellness group which plans to enter the nation by venturing into a franchise partnership with the Chandigarh-based hospitality and food service firm KWalls Hospitality. The investment is to set up numerous “Culinary Wellness” branded stores across the country.
  • Mondelez International is a US-based confectionery, beverage, and food company which inaugurated its all new manufacturing unit at Andhra Pradesh. The entire plant pooled in an amount of US$ 190 million to build this unit with an annual production capacity of 250,000 tonnes.
  • Pure Circle is a Malaysia-based natural sweetener producer which plans to invest about US$ 200 million in setting up a manufacturing unit in India and make the nation its regional export and production hub within the next 5 years.
  • Bundl Technologies Private Limited’s Swiggy, which is a food delivery start-up, has raised over US$ 33.80 million in a Series C funding round with its existing investors Accel Partners, Apoletto Asia Ltd, SAIF Partners, and Norwest Venture Partners.
  • Gujarat Cooperative Milk Marketing Federation [GCMMF], which is popularly known as Amul, plans to invest about US$ 733.6 million to setup 10 new processing units as well as expand their present capacity to touch 32 million liters per day by the end of 2020.
  • The American doughnut chain Dunkin’ Donuts has collaborated with the local online grocery deliver platform known as Grofers for home delivery of their freshly made and packaged products.
  • India Value Fund Advisors, one of the most popular names amongst the private equity firms in India, has plans to invest about US$ 100 to 150 million within the food sector of India over the next two years.
  • The popular discovery and restaurant search platform Zomato has successfully raised over US$ 60 million for Singapore’s government-owned investment company Temasek, along with existing investor Vy Capital in order to explore new business verticals.
  • ITC Ltd has plans to invest about US$ 117.4 million in establishing a world-class food processing facility in Telangana. The company has also formulated their plans to penetrate the dairy market.

[Image Source: http://mofpi.nic.in/sites/default/files/cii1.jpg]

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