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MTR Foods increases focus on instant mixes and spices, invests Rs 15 cr for new plant for spices
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Wednesday, 23 June, 2010, 08 : 00 AM [IST]
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Our Bureau, Bangalore
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 MTR Foods, a wholly owned subsidiary of Norway-based Orkla Group, will now look at investing Rs 15 crore raised through internal accruals for setting up a new production plant at the Bommasandra Industrial Area in Bangalore. The effort is to have a national presence, make instant mixes its key brand and become the largest player in the space. Efforts are also on to introduce flavours popular in the eastern, western and northern parts of India.
The company has now introduced a new face of change for the brand by re-launching it in India, with all of its packaging re-designed, The object of this exercise was to revitalise the brand so that it appealed more to India’s modern consumers. At the same time the product will retain the vegetarian and authentic flavour.
In the last two years, the company has managed to capture 25 per cent of the mixes market and a 36 per cent share of the instant mixes and snacks space in the country. The company, which was known to have changed the face of ready-to-eat foods, has captured a 53 per cent share here.
After the acquisition by Orkla in February 2007, the company has now devised an aggressive strategy to garner growth through revenues, profitability and investment.
Ending fiscal 2009, the company clocked Rs 250 crore and was confident to double it by 2012. The key growth drivers were the range of easy-to-use and ready-to-mix spices which would hasten cooking process of the modern working woman known for her multi-dimensional roles, said Sanjay Sharma, CEO, MTR Foods, at a press conclave here.
“We have a storng position in the instant mixes market and leadership status in the segment for blended spices with 34 per cent market share and pure spices with 11 per cent share in Karnataka and 15 per cent market share in Andhra Pradesh for the former. We have adopted both technology and innovation to offer a variety in the future. The instant mixes and spices will drive the growth and we intend to expand and strengthen our presence through distribution and brand building exercises,” he added.
As part of its new image, the company has now introduced new packaging. The white packs will be daily use spices and the red packs will be the ready-to-eat range.
The company is also looking at charting its future growth through either organic or inorganic growth paths. The latter will be an initiative of its parent company, Orkla, which pumped in Rs 100 crore for plant modernisation and another Rs 25 crore for diversification into the beverage segment in 2007-08.
MTR Foods, which currently has a presence in 1,000 towns in India has a strong presence in the south. In order to maximise growth opportunities, the company will now pull out of over 350 of the 500 towns in north, west and east. We will now be present in 150 towns and grow the market in the north, including western and eastern region, says Sharma.
According to Paul Jordahl, chairman, MTR Foods and CEO, Orkla Brands International, MTR was a maiden step into India and added a strong distribution network and was scouting for more brands in new categories.
MTR between 2000-2010 has grown from Rs 58 crore turnover to Rs 250 crore with a 20 per cent CAGR and with a 10 per cent EBITDA (earnings before interest, taxes, depreciation and amortisation). The company is among the five largest food producers in India which has ITC Foods, Kohinoor, Tasty Bites and Priya. Currently 10 per cent of its earnings are from international markets of the US, the UK, Australia, New Zealand, Malaysia, Singapore, the UAE, Japan and Oman. Revenues from the international arena will increase to 13 per cent by 2012.
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