Greek snack-maker Chipita invests Rs 600 cr in Sanand

Jun 06 2014, 21:31 IST
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The plant at Sanand will be the company's second manufacturing unit after the one in Mumbai. Reuters The plant at Sanand will be the company's second manufacturing unit after the one in Mumbai. Reuters
SummaryGujarat's auto-hub turns into snack-hub as Nestle, Colgate, Rasna and Inbisco set up base.

Greek snack manufacturer --- Chipita --- is the latest to make a foray into Sanand in Gujarat. This company from the Mediterranean region is in to confectioneries, croissants and cakes and has invested over Rs 600 crore in Gujarat's auto-hub that is fast turning into a snack-hub consisting of FMCG majors like Nestle, Colgate Palmolive and Rasna.

The plant at Sanand will be the company's second manufacturing unit after the one in Mumbai. Chipita that produces and markets single serve croissants, mini croissants, cakes, bake rolls, confectionery, jams, potato chips and extruded snacks in different locations across the globe will be 3.04 lakh square feet of land (28,000 square meters) at Sanand, sources in the Gujarat government told The Indian Express.

"Chipita has been allotted the parcel of land in Bol GIDC at Sanand. They would be manufacturing agro-food products including those made from cocoa," said a senior official of the Gujarat government.

It is one of the biggest multinational companies to set up base FMCG space to enter Sanand after swiss-diary Nestle India bought about 50 acres of land (34.83 lakh square feet) in the auto-hub. Nestle has spent over Rs 87 crore on just buying land in Sanand.

Established in 1973, Chipita, first began producing and marketing savoury snacks including extra cheese-flavoured corn snacks. The unit at Sanand will be the company's 19th unit world-wide. The company has a strong international presence with 11 manufacturing plants in Bulgaria, Greece, Poland, Romania, Russia and Turkey and has an additional seven plants that it operates through strategic partnerships in Egypt, Mexico and Saudi Arabia.

Requesting to remain anonymous, a company executive based in Mumbai confirmed the development and stated that the company currently sells it's products manufactured in Mumbai largely to markets in Jharkhand and Chattisgarh.

"The biggest attraction for any FMCG company is it's presence to a finished goods market. This brings down their cost of transportation in a big way. Secondly, FMCG companies in India --- most of whom are MNCs --- look for good quality infrastructure like water supply, roads and power. Gujarat fits very well in all these parameters," says Nirav Kothary, head of industrial real-estate division at Jones Lang LaSalle (JLL), a global property consultant.

"There will be a deluge of FMCG companies into Gujarat, if the state government started offering incentives like the governments of Andhra Pradesh, Tamil Nadu and Karnataka do," Kothary added.

Even without the incentives, companies like Inbisco, Colgate and Rasna have made Sanand their home. Inbisco India Pvt Ltd that has bought 9.1 lakh square feet of space in Sanand at a cost of about Rs 12 crore is already building it's plant.

Similarly, Colgate-Palmolive (India Ltd) has acquired about 16.9 lakh square feet of space at the cost of Rs 42 crore, while Rasna Pvt Ltd has acquired over 96,000 square feet of space at the cost of Rs 77 lakh and Jain Dairy has invested a similar Rs 74 lakh in buying 92,500 square feet of space at Sanand.

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