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A few months ago, Jayesh Desai, Chairman of the ₹3,000-crore Rajhans Group, decided to venture into chocolates after dabbling in real estate.
It was not an easy transition for the 40-year-old entrepreneur but the thought of introducing an authentic Indian chocolate brand prompted him to challenge the MNCs with his new brand, Schmitten and Hoppits.
Another Gujarat-based entrepreneur, Dhirendra Singh, has decided to pit his beverage brands against the MNC ones after listing his company, Manpasand Beverages. With brands like Mango Sip and Fruits Up, the 17-year-old company is getting ready to enter the snacks segment.
Make in India brandLike Desai and Singh, a bunch of first-generation entrepreneurs from Gujarat are building scale, capacity and distribution into categories like chocolates, snacks and soft drinks — segments currently dominated by MNCs.
“We cannot have two MNC players like Nestle and Cadbury monopolising the chocolate market. Schmitten has 90 per cent imported ingredients and is as good as any international brand. We want to challenge the MNCs who have been dominating this segment with a truly Make in India brand which we plan to take to the UK and US,” said Desai. The eight-month-old Schmitten brand of premium chocolates has increased its capital expenditure and ad spends, and has appointed actor Priyanka Chopra as its celebrity endorser.
“We have invested ₹400 crore to set up a factory in Surat and are slowly building distribution with the target of reaching ₹100 crore sales turnover in the first year with our chocolates,” Desai added.
Manpasand’s Singh said that while MNCs use a synthetic base for their carbonated beverages, he has created the carbonated fruit drink category as a healthier option.
“Competition will increase with MNCs as we expand our product portfolio with snacks and other beverages,” said Singh, who serves the company as CMD.
PE backingThe FMCG firm, which plans to raise ₹400 crore via an IPO, is backed by PE funds like Saif Partners and Aditya Birla Private Equity.
“PepsiCo has been trying to acquire a strategic stake in Balaji Wafers for the past two years. MNC players are realising that smaller FMCG companies have access to funds and can scale up distribution.
“As long as the brand is strong with a value proposition, they would show interest in forging deals but we would rather have PE funds picking up a stake in our company,” added Singh.
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