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The Validal Group is planning to merge its production and marketing companies. Currently the Rs 240-crore Vadilal Industries is the flagship company with units such as production, exports and processed food under it while the Rs 260-crore Vadilal Enterprises is the marketing arm of the ice making major.
streamlining operations
Mr Devanshu Gandhi, Managing Director, Vadilal Industries, told Business Line , “We are working on merging the two companies of Vadilal Industries with Vadilal Enterprises. There is no point in functioning as two separate companies. With this, a lot of redundant functions in managing the operations will get reduced. There will be streamlining of operations.”
Currently, both the companies are listed entities and have separate boards. “With the merger, there will be no need to have separate boards and even the support services and administrative costs of managing both the companies will come down.”
Cold chain
Investing Rs 80 crore behind its cold chain and ramping up its distribution this summer, Vadilal is gearing up for the season with a range of premium cones, cups and candies. “We have decided to increase the price of our cones, scoops and candies, which will now go premium at Rs 35. There will be high value addition in the impulse products, which are currently available for the masses at a price range between Rs 10 and Rs 15,” added Mr Gandhi.
Being primarily a western region brand of ice creams, Vadilal is also increasing its presence in the northern markets through better cold chain and distribution facilities.
As Mr Gandhi says, “Considering we are primarily a Gujarat focussed brand, but now we are working in increasing our distribution in the northern markets where there is high per capita income.”
The ice cream major would increase its distribution network to reach out to 60,000 outlets through 750 distributors.
Its foray into retail five years ago through the `Happinezz Parlours' is still restricted to the western markets. “We are again working on taking our parlours national and have franchised our retail operations,” said Mr Gandhi.
To increase market share
Pitted against majors such as Amul and HUL in the Rs 2,500-crore ice segment, Vadilal is now gearing up to increase its market share from 20 per cent to 24 per cent with its enhanced distribution and manufacturing capacities.
Currently Vadilal and HUL are on par with a 20 per cent share in the category while Amul continues to be the leader with a 40 per cent share.
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