The Hindu Business Line : ‘Ready-to-eat segment set to grow’

Mumbai, Oct. 22 The Tata Strategic Management Group estimates the ready-to-eat food market in India to reach Rs 2,900 crore by 2015, with a penetration in 25 million households.

The current RTE market is low at Rs 128 crore, with the packaged food industry accounting for only six per cent of the national food market, according to the study.

“But as convenience becomes the goal for households, with an increase in the number of urban population, working women and income levels, RTE has become the fastest growing sub-segment in the packaged food category,” said Mr Pankaj Gupta, Practise Head, Consumer and Retail. The study reveals that frozen RTE is the largest selling segment, with chilled segment being the fastest growing in the global market, while the dried ready meal segments are non-existent in India.

The handful of Indian players such as MTR, ITC, Tasty Bites, Kohinoor and ADF Foods operate at very low margins due to low capacity utilisation, arising from inadequate demand. “But we will see a growth of both regional small players and national players in the RTE segment owing to the diversity of the Indian cuisine, and both will do well,” said Mr Rahul Bhinge, Chief Executive Officer.

The factors contributing to the growth of RTE in India will be cold chain development, disintermediation, economies of scale on the supply side and increasing disposable incomes, said the report.

The Tata group recently acquired a majority stake in Innovative Foods Ltd from the Amalgam Group to foray into the processing foods segment but when asked about the company’s plans of expansion in the sector in the light of the survey findings, the officials were tight-lipped.

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