The Hindu Business Line : Godrej Agrovet to set up processing unit in Punjab to take Real Good to North

Crisp growth
The market size of frozen non-vegetarian snacks is estimated at Rs 150 crore and growing at 25-30 per cent per annum, while the vegetarian frozen snacks market is around Rs 200-Rs 250 crore.

New Delhi , Jan.7

Godrej Agrovet Ltd (GAVL), a subsidiary of Godrej Industries Ltd (GIL), has signed a Memorandum of Understanding (MoU) with the Punjab Government to set up a greenfield processing plant to be operational by March 2008. With this, it will foray into the northern market with its Real Good processed, fresh chicken brand.

"We have earmarked an investment of around Rs 100 crore for the new processing unit that will produce our Real Good brand of fresh processed chicken as well as for the further expansion of our rural retail initiative, Aadhaar," said Mr B.S. Yadav, Vice-President, Godrej Agrovet Ltd. Till now Real Good chicken was confined to the western and southern markets.

Bullish on Yummiez

The company is also bullish on its ready-to-eat snacks brand Yummiez, launched mid last year, that has just marked its foray into the northern market starting with Delhi.

"We hope to be present in about 15-16 cities in the north, hiking our pan-India presence to 22 tier-1 cities by March 2007. On the retailing front, our aim is to be present across 2,000-2,500 outlets by 2006-07," Mr Yadav told Business Line. The company plans to start its foray into tier II cities after March 2007. "The rollout of Yummiez has taken much longer than other FMCG products since our brand required a well-set-up cold chain system," he explained.

Towards this, the company plans to supply its retailers almost 2,000 freezers by the end of the current financial year.

The company's capital expenditure is already over Rs 10 crore, a major part of which was spent on the supply of freezers to retailers. While on marketing, which is currently local in nature, GAVL plans to spend about Rs 3 crore by the end of financial year 2007, and double the amount in 2007-08.

The market size of frozen non-vegetarian snacks is estimated at Rs 150 crore and growing at 25-30 per cent per annum, while the vegetarian frozen snacks market is around Rs 200-Rs 250 crore. GAVL aims at capturing around 14-15 per cent of market share in both the vegetarian and non-vegetarian sections by March 2008.

While Yummiez is expected to become a Rs 25-crore brand by March 2008, GAVL targets a turnover of Rs 1,000 crore for the financial year ending March 2007.

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