Swedish Tobacco Major To Intensify India Ops

Gothenburg, September 23: | Updated: Sep 24 2003, 05:30am hrs
Swedish Match Consumer Products, the manufacturers of Swedish snus, a specialised form of tobacco product, is planning to intensify its operations in India. Snus is made from air cured tobacco, the powdered form of which is blended with water, salt and other flavours and is available in loose and pouch forms. It is consumed by keeping between the upper lip and gum. In India, the company sells only the pouch form under the Click brand in the form of cans (with 10 pouches) for Rs 15 and in sachets having two pouches for Rs 3.

Next to Sweden, India is the most important market for us at the moment followed by Russia, the US and Japan, says Patrik Hildingsson, director, public affairs, north Europe division, Swedish Match. With the new plant at Kunglav (in Sweden) expected to be operational soon, we are definitely looking forward to intensifying our activity in India. SMCPLs plant in Gothenburg produces 200 million cans of snus every year.

Elaborating on India plans, company president B Mukherjee says, we have already crossed the test marketing stage and now we are studying the possibility of local packaging. We are developing a packaging machine in India, which is at a trial stage now. This is expected to be completed in a couple of months and, depending on market demands, we might open a packaging plant either in Delhi or Mumbai or both. Mr Mukherjee however, declined to disclose the investment it has made in the packaging plant.

Mr Mukherjee says the test marketing done on males in the age group of 25- 45 in Maharashtra, Karnataka, MP, UP and Delhi has revealed that 60 per cent of the snus users earlier used high end oral tobacco products. 40 per cent were cigarette smokers, he adds. We have also noticed that 20-30 per cent of people who started taking snus are continuously using it either once or twice a week. Interestingly, several doctors are also using it happily, he claims.

In Sweden, 12 per cent of the adult population use snus and the average age of snus consumers is 38 years.

By 2004, we will be adding more Indian flavours such as saffron and cinnamon to the existing flavours of the Click brand, says Mr Mukherjee.

The company is also looking at increasing raw tobacco procurement from India. Earlier, only 20 per cent of tobacco came from India, but now it has reached about 60 per cent of the total procurement. We hope the figure will rise in the future, he says.

(Travel for this story was sponsored by Swedish Match)