HLL food categories to ride on beverages success

Mumbai, July 31 | Updated: Aug 1 2005, 05:30am hrs
Riding on the success of its business model in the beverages segment, where Hindustan Lever Ltd (HLL) saw a growth of 16% in the June quarter, the company has said the rest of the foods business would now ride on that model. Driven by brands Brooke Bond in tea and Bru in coffee, HLL's beverages business saw Brooke Bond growing for six consecutive quarters and Bru also achieving strong growth.

"We are beginning to win in beverages. The other foods categories can ride on that model," HLL chairman Harish Manwani said. He said foods was a "slow burn" business in developing markets and the key issues were penetration and increasing the consumption possibilities. He said Lipton Ice had been marketed in Chennai and Bangalore and with the strategic alliance with Pepsi, it was all set to go national next season.

Citing market share, brands, and market development as the major parameters on which to judge success of the businesses, he said Knorr had a 70% share of the market in branded soups while ketchups, savouries and sauces would also be pushed. "We will work at this till an inflexion point is reached," Mr Manwani said.

On the processed foods side, HLL saw gains in squashes and salt being offset by declines in atta and ketchup.

Referring to brand Annapurna and salt, he said the aim would be to add value and build the brand around it. Branded atta, for instance, would be pushed in an aggressive way in the south and the west where the consumers weren't used to having home made atta products that much. In the north, however, atta was a problem because of the north Indian's penchant for home made atta preparations.