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“GST is expected to drive down costs”
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Monday, 21 August, 2017, 08 : 00 AM [IST]
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Anurag More
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 HRS Process Systems Ltd (HRS PSL), India, is part of the UK-based HRS International Group of Companies, a prestigious name in the field of innovative heat transfer solutions. HRS Group is globally recognised for providing sustainable, energy-efficient range of heat exchangers and heat exchanger-based systems. In India, since year 2003, HRS PSL has built its reputation in value-added engineering, manufacturing excellence and customer service. HRS infrastructure today boasts of a state-of-the-art manufacturing facility spread over five acre land at Koregaon Bhima, Pune, and a strong network all across India to meet ever-growing needs of the industry in domestic market. Worldwide, HRS has presence through its group companies in the UK, Spain, USA, Malaysia, Australia and New Zealand. In an email interaction with Anurag More, Gokul Das, managing director, HRS Process Systems Ltd (HRSPSL), delved deeper into the food processing machinery market in India, impact of GST on the sector and more. Excerpts:
Brief us about the current food processing machinery market in India. What is the size of the market and its expected growth rate by 2020?
India food industry is one of the largest sectors of the economy valued at over US$30 bn and expected to grow by over 10% Compound Annual Growth Rate (CAGR) in the coming decade. The sector encompasses all kind of food products like fruits, vegetables, grains, beverage, dairy, bakery, poultry, livestock, fisheries, confectionery, prepared food, and fortified food. The industry ranges from cottage to small-scale, medium-scale, specialised and very large-scale units, depending on the raw product and end-product.
Needless to say that the food processing machinery market in India is also a huge market and expected to grow in similar lines to match the consumer demands. Estimated value is over US$12 bn with CAGR of 10% plus in coming decade. The growth is expected in all areas, however, packaging, processing and storage will attract more investment opportunities.
What are the technological innovations taking place in the Indian market?
The technology innovation taking place in the Indian market is consumer-focussed. Processing and packaging are two key areas that have seen tremendous technology innovations, apart from produce handling and storage to reduce spoilage/wastage. Today we have products available in various types and size of containers with different shelf-life. To keep pace with the growing consumer demands the food processing machinery manufacturers need to innovate and imbibe technological advancement and innovation to sustain and grow in the market.
What are the key market trends impacting the growth of the food processing machinery market in India?
Globalisation coupled with strong demand, nuclear families, young population and rising disposable incomes, has been the game changer for food processing and machinery industry in India. Consumers want latest food products available in the global market at their doorsteps and at their convenience, which saves their time. This necessitates a very high quality and technology food processing machinery to deliver quality product fit for human consumption and having a shelf life to give good return on investments (RoI) to the manufacturer.
What are the challenges to market growth?
The food processing market is health-conscious and consumer taste/preference-driven. Changing consumer preference and demand for a better and “value for money” products has always been the game changer. Not all products have been a runaway success, although there have been some great success stories. One of the primary challenges to market growth is availability of raw material of right quality and in quantity as required for a production unit. A minuscule 8-10% of the total produce finds way into the organised processing sector. There is a need for enhanced investment in infrastructure for storage and transportation of the produce from farm to production units.
The food processing machinery market also has many “me too” products which do not deliver on consumer requirement thereby both the producer and consumer are impacted. The challenge for the producer and machinery manufacturers is to develop process and equipments which are capable of delivering high quality products from seasonal or non-seasonal food products, with sufficient shelf life to enable growing demand.
What steps are being taken to overcome the same?
In the past decade, huge investments have been made into infrastructure and in agricultural produce storage and transport, to enable higher farm produce availability for processing units and reduce wastage. Establishment of food parks and mega food parks are a push in the right direction for growth of food processing and machinery market. Availability of finance for agriculture and food processing sector as priority lending sectors, has been a key enabler for growth of the sector.
What are the key factors driving the food processing machinery market in India?
The food processing machinery market in India is primarily driven by huge growth in consumer demand for various food products. Global travel and access to better food products in developed economies, nuclear family, high disposable income, young population, health-consciousness and value meal have become key words in this segment. Understanding this trend, most of the food processing companies have invested heavily to enhance their processing capacity and introduced products in India which are available globally. The current trend of investments is on enhancing value-added products and also processing in bulk of basic ingredients to have better quality consumer products at lower costs.
What impact will goods and services tax (GST) have on the machinery?
GST is expected to drive down costs eventually in the longer run. GST is just implemented and currently there is a lack of clarity at the tax structure vis-à-vis earlier structure (including concessions and set-offs). The impact is expected to smoothen up in the coming months and thus help in growth in the segment.
Is the machinery imported or made in India? If imported, which are the major importing nations?
The food processing sector has always had the latest machinery for processing and hence imported machinery formed a big chunk of the process machinery used in food industry. These were primarily imported from Europe and in the recent time from the American and South East Asian countries. Companies like HRS PSL offer “Made in India” process machinery for various fruits, beverage and other liquid and semi-liquid food processing including nutraceuticals and special process machinery for processed food and ready-to-eat food. There are many other companies, which do make quality machinery for various processes in the food sector. There is increasingly less dependence on imported machinery in processing segment, however, in recent years there has been high growth in imported packaging machinery for various products.
Who are the key vendors in the food processing machinery market in India?
There are umpteen vendors for various food processing machinery catering to different segments or products in the food industry.
What are the market opportunities and threats faced by the vendors in the food processing machinery market in India?
The food processing machinery market is slated to grow by double-digit in the coming decade and beyond. Hence, there will be opportunities for companies who have the right kind of products, invest in innovation and technology upgradation. Vendors will have to ensure that the food product made from their process machinery is of global standard even if the produce is sold in local market. Food processing is predominantly driven by consumer demands, taste and preference. Hence changing consumer demands have a major impact on type of products processed and machinery requirements. There are also instances with vendors stuck in project which is ill-conceived and does not take off and thus incur loss. Therefore it is imperative for food processing machinery manufacturers to ensure that they work closely with the customer to ensure best flexibility possible in the machinery supplied and performance of equipment is as committed.
Tell us about products offered by HRS Process Systems for the food and beverage industry. What makes you different from other players?
HRS Process Systems Ltd, India, is part of the UK-based HRS International Group of Companies. HRS has been at forefront of thermal processing technology which is the backbone of food product processing. HRS Group is globally recognised for providing sustainable, energy- efficient range of heat exchangers and heat exchanger-based systems. HRS PSL has built its reputation in value-added engineering, manufacturing excellence and customer service. In India, since year 2003, HRS today boasts of prestigious certifications and design expertise in the heat transfer arena and its ISO 9001:2008, ASME 'U' stamp accredited state-of-the-art manufacturing facility 35 km from Pune to cater to ever-growing customer requirements and demands.
HRS offers range of customised heat exchangers and heat exchanger-based systems for a wide spectrum of manufacturing and process industries. HRS products range includes Ecoflux Corrugated Tube Heat Exchangers, HRS Funke Plate Heat Exchangers and Customised Heat Exchanger-based Systems. HRS adds value to food processing industry with advanced product range of HRS Monobloc Aseptic Steriliser with Filler, evaporation systems, turnkey beverage processing solutions as well as Unicus scrapped surface heat exchanger, Hygienic Piston Pump, HRS ParaDice dice pasteuriser and systems for special applications in dairy, nutraceuticals and infant food supplements.
HRS is adding value to food processing industry through various innovative solutions for fruit and vegetable pulp processing, beverage processing, ready-to-eat food. Unique technology solutions from HRS like the non-fouling Ecoflux corrugated tube heat exchangers, hygienic piston pump can be used to process pulpy, viscous, dices, particulate fruits or vegetables and ready-to-eat fruits & beverages efficiently. Our range of Ecoflux corrugated tube heat exchangers and other heat transfer products are designed to deliver hygienic products and sterile products as required by the customer, in beverages, nutraceuticals and such products, where highly reliable thermal processing solution is key to success.
HRS with extensive process know-how, design and manufacturing expertise is a leading food processing technology solutions provider. HRS' capability to offer systems for efficient and value- added processing of fruit dices, particulates foods, processing of vegetables, grains, pulses for end- use in ready-to-eat foods without shearing are a significant advancement in processing technology. Solutions for processing of sensitive dairy products, nutraceuticals, probiotics, infant food supplements and similar applications for quality processing have enabled HRS to make a strong footprint in these sectors.
We are global company, hence our technology and system design take care of international requirements and thus differentiate us from all the other players. We integrate systems with high level of automation to enable persistent quality products.
Brief us about your expansion plans. How much will be investing for the same?
HRS has already made investments in the past few years to take care of growing demands in the food processing machinery market. HRS energy-efficient heat exchangers incorporated into preheaters, pasteurisers, sterilisers and evaporation systems enable customers to have non-stop production during the season.
Our advanced evaporation systems ensure that the fruit pulp is reduced in volume by reducing the water content, our HRS Monobloc aseptic steriliser with filler processes and packs this pulp in a complete hygienic environment. This in turn means that the fruit processing companies are able to cut down significantly on packaging, transportation & storage costs as more quantity of pulp can be filled in same size of containers. Our customers have appreciated our systems and also service support.
HRS has installed evaporation plants and monobloc aseptic steriliser for mainly mango pulp at renowned processors. Some of these lines are also multi-fruit processing lines allowing processing of tomato, guava, pineapple and some more variants of fruits and vegetables. Many of these companies in turn either export their produce or supply to large food and beverage companies. We are seeing a substantial increase in demand for our pulp processing solutions from the mango sector.
Our HRS Paradice dice pasteuriser, UHT system, nutraceuticals processing lines are some of the key solutions to the market giving our customers the particular advantage for meeting the demand for superior quality foods. HRS ParaDice is a unique offering from HRS Process Systems, which is capable of processing fruit dices / vegetable dices / ready-to-eat food without any damage to the structure and composition. This innovative processing technology opens up a huge potential of applications for diced fruits and vegetables, ready-to-eat foods where the natural taste, texture and shape is of huge priority.
Over a decade, HRS has garnered an extensive list of esteemed customers who have entrusted HRS technology for some of the leading food brands. The latest offering from HRS is the complete processing solution for mega food parks for end-to-end making of pulp, beverages and other foods to desired capacity requirements. We are geared up for our growth journey of becoming a Rs 1 bn company soonest and beyond.
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