Heat and Eat Foods Industry - MarketResearch · With the widening market and increasing product differentiation, the heat and eat category came into existence The industry was marked

Heat & Eat Foods Industry ValueNotes India Market Intelligence Dashboard

Market share of top 5 firms = 86%

Organised Sector Concentration

Macro Data: Market size, growth, market

shares of key players, customer segments, key

industry metrics

Micro Data: Segmental market size & growth,

financials of key players

Completeness: All data points is available

Quality: Accuracy of data

Recency: Latest period data is available

Sources of Data

Data Availability

In

du

stry

Stru

cture

Ministry of Food Processing Industries,

Food Safety and Standards Authority of

India

Company websites, News

articles

Confederation of Indian Food Trade and Industry

Copyright © 2014 ValueNotes Database Pvt Ltd. All rights reserved.

Completeness

Quality

Recency

Macro

Data

Micro

Data

Government

Bodies

Trade Interviews , etc

www.valuenotes .biz 2014

Output in organised Sector = 92%

Market Size And Growth

Industry Segmentation

The heat and eat industry in India is currently valued at INR 2,370mn (~USD 39.49mn ) in FY 2014 and has been growing at CAGR 18% for the last three years

The industry is expected to grow at CAGR of 22% in the next five years till FY 2019, due to rapid urbanisation and increasing disposable income as well as expected improvement in retail infrastructure

ValueNotes estimates that the industry will be worth approximately INR 6,405mn (~USD 106.73mn) by FY 2019

Curries are the most popular category, contributing to 55% of the total sales of heat and eat products

Rice delicacies rank second with a 20% share

Light meals contribute to 10% of the industry followed by desserts (5%)

Key Players

92% of the heat and eat market is organised

The top five players are ITC, MTR, Kohinoor, Gits and Tasty Bites

ITC and MTR contribute 49% to the sales of the industry together

9 Copyright @ 2014 ValueNotes Database Pvt Ltd. All rights reserved

Exe

cuti

ve S

um

mar

y

The heat and eat industry in India has been given an Industry Attractiveness Rating of 5.5 as per the ValueNotes Industry Attractiveness Rating Evaluation System.

Drivers and Challenges

Drivers

Apart from steadily growing urbanization, disposable income, increase in youth population and female work participation in India; the growing Indian retail market is expected to drive the heat and eat industry

Challenges

The industry is affected by dominance of substitutes and alternatives. Additionally, unfavorable consumer perception and price hike in packaging materials can also inhibit the growth of the industry

1 USD = 60.01 INR (2014 and onwards)

TOC Market

Overview Annexure &

Appendix Industry Trends

Competitive Environment

Industry Structure

Executive Summary

Drivers & Inhibitors

Industry Attractiveness

29%

20% 18%

11%

6%

16% ITC

MTR

Kohinoor

Gits

Tasty Bites

Others

Industry Structure

Picture Courtesy: Daifuku Source: www.awesomecuisine.com


The ‘Heat and Eat’ category is the latest addition to the convenience food segment

Ch

apte

r 1

:He

at a

nd

Eat

Fo

od

s In

du

stry

Str

uct

ure

Convenience Foods

Ready to cook Frozen Foods Heat and Eat

Ready-to-cook products involve a small amount of preparation by way of addition or mixing of few ingredients. The form of the product changes. They are of the following types: Instant noodles Soups Pasta Ready meal mixes (which include

breakfast mixes, snack mixes, dessert mixes and instant mixes)

Dehydrated foods (like pot snacks) Popcorn

Heat and Eat food products are merely meant to be heated and then consumed by the user without changing the form or structure of the food item. They are of the following types: Curries Rice delicacies Dessert Light meals

Convenience foods, when included with snacks, confectionary and dairy products constitute what was earlier known as the ready-to-eat industry and is now known as the packaged or processed food industry

Frozen foods are products which have been frozen or chilled for preservation. They may or may not be used for further preparation. Frozen foods which come under the convenience food segment are included. These are: Frozen ready to eat products

like French fries, nuggets (which need to be fried before consumption)

TOC Market

Overview Annexure &



Industry Structure

Executive Summary



Copyright @ 2014 ValueNotes Database Pvt Ltd. All rights reserved 12

The ‘heat and eat’ industry is slowly coming into its own

Late 1980s – 1990s

The Ready to Eat (RTE) category of

foods was first introduced in India in

1987, but this concept was not

received agreeably by Indian

consumers

The RTE market did not provide any

specific products beyond the Cup O

Noodles manufactured by Indo-Nissin

2000 – 2010

With the advent of new technology which

improved shelf stability of products and growth of

storage and distribution centers, the RTE

products began to gain popularity

With the widening market and increasing product

differentiation, the heat and eat category came

into existence

The industry was marked by the entry of new

players like ITC and Gits in the earlier part of the

decade

In the later part of the decade, the market showed

slow growth and stagnancy in some parts of North

and East India and therefore, companies like ITC

discontinued the sale of their brands in these

regions

Current Situation (2011 onwards)

Elaborate product differentiation has now

divided the former ready-to-eat category into

ready-to-cook, heat-and-eat products and

frozen foods

The industry is doing well in tier I and tier II

cities, although penetration in small cities and

rural towns is still low

Entry of new players into the industry like

Priya Foods and Heinz with their region-

specific products and relaunch of existing

brands in various parts of the country has

contributed and will continue to contribute to

the growth and expansion of the industry

Ch

apte

r 1

: Evo

luti

on

of

he

at a

nd

eat

ind

ust

ry in

Ind

ia

TOC Market

Overview Annexure &



Industry Structure

Executive Summary



Copyright @ 2014 ValueNotes Database Pvt Ltd. All rights reserved 13

This report covers:

• Heat and eat products which include products packaged with heat-

sterilization technology and retort packing technology. Products

packaged with these require only heating to be consumed

This report does not cover:

• Snack products which can be consumed directly without heating

• Snack products like popcorn which change their form upon heating

• Ready-to-cook products which require minimal amount of

preparation or cooking which changes the form of the product

• Frozen foods

• Chilled foods like fruits, vegetables and dairy products

Ch

apte

r 1

: In

du

stry

Def

init

ion

Definition of ‘Heat and Eat’ as per the scope of this report

The heat and eat industry constitutes foods which are merely meant to be heated and then consumed by the user without changing the form or

structure of the food item.

On the basis of the nature of products and their packaging, the industry exists in India in the form of the following segments:

Heat-sterilized products: Food which is preserved in heat-sterilized pouches and which can be consumed after heating, using boiling water or the

microwave oven

Indian breads: Different types of chapattis, parathas, etc. which require just heating for consumption

JUST HEAT AND EAT

METHOD 1 Cut pouch, empty contents into a frying pan, and heat for 3-5 minutes while stirring. Serve hot.

METHOD 2 Cut pouch, empty contents into a microwave dish, heat on high for 1-2 minutes and serve hot.

. METHOD 3 Immerse the foil pouch in boiling water for 3-5 minutes. Cut open and serve hot.

TOC Market

Overview Annexure &



Industry Structure

Executive Summary



Industry Overview

Source: www.awesomecuisine.com

Usage of “Three point analysis” to arrive at growth figures: - Optimistic: Maximum growth if all growth factors* occur as expected - Pessimistic: Least growth, if growth factors are delayed or not

implemented - Most Likely: Growth which has highest probability of taking place


Chart 2: Heat and Eat Market Size & Growth (INR million)

The estimated growth of ‘the heat and eat industry’ is based on various factors* including:

- Xxxxxxxxxxxx - Xxxxxxxxxxxxxxxxx - xxxxxxxxxxxxxxxxxxxx - xxxxxxxxxxxxxxx - xxxxxxxxxxxxxxxxxxxxxxx

Source: Trade interviews, ValueNotes Analysis

Current market

Estimated growth

Ch

apte

r 2

: Mar

ket

Size

& G

row

th

Chart 1: Share of heat and eat in convenience foods segment in 2014 – India

Heat and eat industry is expected to grow at a CAGR of 22% till 2019

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

Xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx


CAGR xx%

CAGR xx%

CAGR xx%

TOC Market

Overview Annexure &



Industry Structure

Executive Summary



Frozen Foods xx%

Heat and Eat xx%

Ready to cook xx%

CAGR xx% xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

350

1,350

2,350

3,350

4,350

5,350

6,350

7,350

FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019


The percentages have been calculated using volume of the products Source: Trade interviews, ValueNotes Research

Ch

apte

r 2

: In

du

stry

Se

gme

nta

tio

n b

y ca

tego

ry

Curries contribute most to the ‘heat and eat’ industry in India

Chart 3: Heat and eat industry segmentation by category xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx


xxxxxxxxxxxxxxxxxxxxxxxxxxxxxx



xxxxxxxxxxxxxxxxxxxxxxxx



xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

“xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx”

- Trade interview

“xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx”

- Trade interview

TOC Market

Overview Annexure &



Industry Structure

Executive Summary



xxxxxxxx xx%

xxxxxxx xx%

xxxxxx xx%

Xxxxx Xx%

Documents

Heat and Eat Foods Industry - MarketResearch · With the widening market and increasing product differentiation, the heat and eat category came into existence The industry was marked