Companies

Yakult Danone to launch new probiotic products

Abhishek Law Kolkata | Updated on January 10, 2018

Minoru Shimada, Managing Director, Yakult Danone. - Debasish Bhaduri

To step up manufacturing at Sonepat facility

Probiotic drink-maker Yakult Danone is looking to expand its offerings with focus on health and functional food segment. Products in these categories are currently in the development stage.

Yakult Danone India is a 50-50 joint venture between Japan’s Yakult and French food company Danone. Its only offering in the country is the probiotic drink under the “Yakult” brand.

According to Minoru Shimada, Managing Director, new offerings will be based on “consumer demand”. He, however, did not mention the time-frame within which the new products would be launched or their exact nature.

“We are looking at the possibility of introducing new products soon. They are currently under development stage,” he told BusinessLine.

The probiotic market, estimates suggest, is around ₹120 crore in India and is growing at a CAGR of 20 per cent.

Apart from Yakult, the other major players in this segment include Nestle, Amul and Mother Diary with offerings being spread in categories like dahi, yogurt and milk.

With a 10 per cent jump in marketing and distribution spends over the last, the company is anticipating higher sales. Accordingly, Yakult Danone will invest in capacity expansion to 280,000 bottles of 65 ml per day, at its manufacturing facility at Sonepat (Haryana). The ramp-up is expected by December.

The facility’s current capacity stands at 200,000 bottles per day.

“We are yet to finalise the investment amount,” he said adding that so far the company has invested close to ₹360 crore in its manufacturing unit.

Compared to 2016, when the company witnessed a 10-13 per cent growth in business; Shimada anticipates growth for this year (2017) to be around 20 per cent.

Increased presence

Yakult Danone is also working towards enhancing its presence. With the consumption trend having a 70:30 break-up, between Tier-1 and Tier-2 cities, the focus now is pushing its products to neighbourhood stores. So far, the company’s offerings have been available across modern trade formats.

In cities like Kolkata, it will also explore the option of using bikes to reach out to smaller retailers and kirana stores.

In some cities, like Delhi, it is also trying out the home delivery model.

“Once we have created a general awareness about the brand, we may look at exploring the home delivery model in Kolkata too,” Shimada said.

Yakult is available in 12 States including Delhi-NCR, Uttar Pradesh, Punjab, Maharashtra, Rajasthan, Andhra Pradesh, Karnataka, West Bengal, Tamil Nadu and Goa.

Published on September 08, 2017

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