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Consumer goods major Hindustan Unilever Limited (HUL)’s decision to stop production and sales of its Chinese range of instant noodles may not have any major impact on its revenues. According to analysts, Knorr, the largest food brand from the English-Dutch firm Unilever’s stable, earns ₹500 crore in sales for HUL annually, which is less than 2 per cent of its total revenues.
The maker of brands such as Dove, Pears, Lux, Ponds and Lifebuoy entered the ₹2,700 crore instant noodles category in March this year to take on Nestle’s Maggi, in the market since 1984. Other major players in this segment are ITC’s Yippee and Capital Foods Ching’s. Beverage maker Horlicks also entered the category few years ago but failed to click.
HUL had earlier restricted Knorr, launched in India five years ago, to soups, ready-to-eat mixes and soupy noodles. Knorr was a German food and beverage brand acquired by Unilever in 2000.
According to analysts, Swiss rival Nestle is under a larger stress as Maggi’s share had declined from 90 per cent to about 70 per cent with the entry of several new players. Even then, the product contributed to nearly a fifth of Nestle’s revenues.
Clearance sought HUL said that it has sought clearance from FSSAI and will resume sales of the products after getting approval, adding that all its food products are safe for consumption.
“HUL has last week conducted additional testing of its noodles range of products from external FSSAI approved laboratories. All these tests show that the Chinese noodles range of products are safe for consumption and continue to meet all regulatory norms,” the company said.
Approval pending It had submitted an application with FSSAI for product approval for the Knorr Chinese range of instant noodles in February and the same is pending approval. “In conformance with the FSSAI advisory to State FDAs dated June 8 with regard to product approvals, HUL has decided to stop production and sale of its Chinese range of instant noodles till such time as its application is approved by FSSAI. HUL is initiating a withdrawal of its Chinese instant noodles from the market,” it said.
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