Godrej Hershey to bring in chocolates

Jul 20, 2009

Confectionary manufacturer Godrej Hershey Foods and Beverages plans to introduce Hershey brand of chocolates in India. Apart from the popular products from the Hershey staple, the 49:51 joint venture (JV) between Godrej and US-based Hershey, also will look at bringing in customised products that suits the local palate, reports Financial Chronicle.

The JV is producing and marketing Hershey chocolate syrups in the country. The facility at Mandideep near Bhopal had started operations six months back. The company, which has a 17 per cent market share in the Rs 800 crore hard candy category, also has introduced two new products Nutrine Froot Shoot and Nutrine Lollipop. Godrej Foods and Beverages had acquired Nutrine Confectionery in 2006 before forming a JV with Hershey in 2007, the report added.

It aims at upgrading the 25 and 50 paise category in the Rs 1,600 crore organised confectionary market by driving the price points to Re 1 and Rs 2 with value-added products, quoted Kinshuk Kunwar, vice-president, marketing of Godrej Hershey in the report.

Hard candies contribute to a major chunk to the Godrej Hershey's Rs 400 crore revenue in the Rs 200 crore southern market, where the company has a 23 per cent share, it added.

"The price points have moved up, but gradually, in the confectionery segment. Compared with 1990s, when majority products were in the 25 paise category, now 66 per cent of the products are in the 50 paise price point," said Kunwar.

However, the product that the company has launched in the lollipop category is priced at Re 1, unlike the other brands that are available for Rs 2. "By this, we hope to bring the 50 paise consumers to this category,” Kunwar added.

The company has registered a 25 per cent growth last year and hopes to grow by 20 per cent this year. It will also spend around 10 per cent of the revenues for advertising and brand promotion, it said.