Set to face Britannia on the milky way.
Danone, the Paris-headquartered $18 billion dairy major, has debuted its dairy products in India. The company during the past week introduced its first product - flavoured milk under the brand ‘Choco+Milk’, in Hyderabad. Industry sources indicated that post this initial launch in Hyderabad, Danone will be looking to roll out its products in a few other cities in the next six months.
Jochen Ebert, General Manager at Danone’s ‘Base of the pyramid’ initiative, confirmed the launch of its products in Hyderabad. Industry sources indicate that post the roll-out of the flavoured milk, Danone may also look to roll out its yoghurt line.
With the launch in India, Danone is set to take the competition directly into Britannia’s stables, with its plans to grow its dairy business. Britannia during October-end launched its range of milk-based health drink for children in Tamil Nadu under the brand ‘Actimind’. In addition to squaring up against Britannia, Danone will be up against Horlicks and Amul in the flavoured milk market in India which is estimated to be around Rs 250 crore.
Danone is pursuing its dairy strategy actively after it recently exited a joint venture which held around 51 per cent in Indian biscuits major Britannia Industries. Danone, by exiting the joint venture, netted capital gains of Rs 380 crore (¤56 million) when it divested its indirect 25.5 per cent holding in Britannia.
Britannia prior to the launch of its flavoured milk had introduced UHT (ultra high temperature) milk with no fat and cholesterol. Actimind is being launched initially in Tamil Nadu and will be available in select cities of Chennai, Coimbatore, Madurai, Trichy & Vellore. Priced at Rs. 15 per 150 ml per bottle, Actimind is available in Mango and Stawberry flavors with a shelf life of 6 months.
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These moves are part of Danone’s overall strategy to increase focus on emerging markets from which it derives a third of its sales. A decade ago, Danone realised 90 per cent of its sales in developed countries. Danone is present in four businesses - fresh dairy products, packaged water market, baby nutrition and medical nutrition.
Danone already has an equal joint venture with Yakult Honsha to develop the Indian market for probiotics. This joint venture has invested close to Rs 150 crore for a manufacturing unit and has been increasing its presence in India in the recent past.