Hatsun sees strong growth in ice creams -- expanding markets and penetration

“I am on my sixth ice cream bar, my tongue is frozen, I cannot talk properly,” says 64-year-old Arunachalam, glee writ large on his face.

“My grand daughter, Mangai, is here from the US, I wanted her to get a feel of Chennai,” he says, as Mangai, shyly smiles, holding her grandfather’s hands as she slurps on a bar of ice cream.

Both are at Arun Ice Creams’ promotional event, “Eat all you can” to promote its new ice cream bars and flavours. The day-long event at a luxury marriage hall in the city had attracted a few thousand participants, young and old by midday.

The company is popularising six new ice cream bars, each a mix of flavours in different shapes – these are extrusion bars using modern technology and are the latest in ice creams, says RG Chandramogan, Chairman and Managing Director, Hatsun Agro Product, the largest private sector dairy company, Arun Ice Creams is its flagship brand.

Ice creams account for about 10 per cent of the ₹ 3,500-crore company, which sells packaged liquid milk under the brand name Arokya, and a host of dairy products under the brand Hatsun. Its latest offering is flavoured milk.

Chandramogan said there is a noticeable shift towards ice cream bars and cones, and the extrusion bar technology enables adding two-three flavours on one bar. Arun Icecreams launched six varieties over the last three months. Ice creams business including its Ibaco chain of exclusive ice cream parlours, accounts for about 10 per cent of its business and is growing strongly.

The predominantly southern markets based brand has entered Maharashtra and Orissa. It has a strong presence in Tamil Nadu, where it has a 60 per cent market share, and in Karnataka, Andhra, Telangana and Kerala. Of the estimated ₹ 1,000 crore ice cream market in South India, the company boasts a 38-40 per cent share, he said.

Hatsun Agro has planned a ₹ 450-crore capital expenditure over 18 months with ₹ 135 crore going into ice creams business including capacity expansion and marketing.

For the first quarter ending June 30, 2016, the company has reported a net profit of ₹ 29.07 crore on an income of ₹ 1,034.28 crore. During the corresponding period in the previous year it reported a net profit of ₹ 28.68 crore on an income of ₹ 867.11 crore. The company has announced an interim dividend of ₹ 1 (100 per cent) a share. (EOM)

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