DS Group to expand cold chain channel

 

 

A: We became a billion dollar group last year with a turnover of over Rs 6,500 crore and a 37% increase in revenue vis-a-vis Rs 4,800 crore in FY13-14. In the past five years, we have grown over 200% in revenue.

 

 

A: All our businesses have been growing at a healthy pace. However, it is the mouth freshener and food and beverage (F&B) businesses, including confectionery and dairy, that have been major growth drivers.

Our F&B businesses have shown remarkable growth and reached a turnover of over Rs 1,500 crore in FY14-15 as compared to Rs 900 crore in FY13-14. Since we had already become the market leaders in our core business, we focused on diversification, particularly in the food & beverage category in the past five years. Today we are present in salt & spices, beverages, dairy, confectionery and mouth fresheners in this segment. Catch, Ksheer, Dairymax, Pass Pass, Chingles and Pulse are some of the premium brands that we own in this category.

 

 

A: The future of food & beverage segment is bright both in urban and rural landscape. According to Grant Thornton report, India’s population and economy are growing leading to an increasing demand for food & beverage. The changing lifestyle and consumption patterns are driving the growth and expected growth of the organised and packaged food and beverage sector.

 

In line with the growth in economy, the total annual household consumption in India is likely to treble (from Rs 82,000 crore in 2005 to Rs 2.48 lakh crore in 2025), making India the fifth largest consumer market by 2025. Food and beverage is the largest segment of the consumption basket.

 

 

A: We stepped into the dairy business in 2011. Over the past decade, there has been a marked increase in the total consumption of milk, cheese and yoghurt, with a consistent year-on-year increase in the per-capita consumption of these products.  We started with ambient milk products such as desi ghee and skimmed milk powder initially and introduced Ksheer, our premium retail brand in 2013.

 

Initially, UHT milk and cow ghee were launched under the brand, which are currently available in Delhi/NCR, Eastern and North-Eastern region of the country.  The company is currently focusing on expanding the cold chain channel to further enhance distribution of short shelf life products. The company is also looking at acquiring new plants for this expansion.

 

There is a huge scope for organised players to expand in this sector as the unorganised retail services a huge demand of milk & milk products.

 

 

A: At present, DS Group is focusing to expand its offerings in the F&B segment to introduce new and innovative products. The investments are not very capital intensive as the products are mostly developed in-house. For the dairy business, we had earmarked an estimated investment of around Rs 200 crore, of which Rs 50 crore was invested in the first phase of the launch in 2011. The balance Rs 150 crore is being used for the second phase of the investment currently. We are also setting up a state-of-the-art plant with an investment of Rs 100 crore in Noida to enhance the manufacturing capacity for Catch salt & spices. This plant should come up in next two years. Around Rs 300 crore (besides the land cost) was invested in a five-star hotel in Jaipur, which would open in November.