The Dharampal Satyapal group, which owns brands like Rajnigandha (pan masala), Baba (chewing tobacco), Catch (spices and beverages) and Pass Pass (mouth freshener), wants to get a bigger share of the food and beverages market. And the brand it has chosen from its portfolio for this purpose is Catch. Catch salt, pepper and spices sold a little over Rs 100 crore in 2009-10, while Catch beverages (natural spring water, soda and tonic water) sold a little under Rs 28 crore.
According to Rajiv Kumar, group vice-chairman & managing director, the expansion in foods will happen in product categories that are kept on the dining table and not in the kitchen. This could mean categories like sauce, jam and pickles. “Our teams are studying the possibilities in each of these categories,” says Kumar. But this is a category not easy to crack. In sauce, there are strong national players like Nestlé’s Maggi and Hindustan Unilever’s Kissan. Bharti FieldFresh Foods has recently joined the bandwagon with its Del Monte range. In pickles, the competition from local producers is intense. Even Nestlé had to withdraw from the market its Maggi range of pickles.
The focus on the dining table also means that large categories like flour and rice are not on Kumar’s radar screen. He puts it down on the challenge of creating differentiation in these highly commoditised categories. Kumar says all new products will have sufficient differentiation — that is the brief to the development teams. This, he claims, is the reason for the success of Catch spices (basics, wholes and blends): Since the spices are purer than rivals, less is required in cooking. However, Catch is a small player in the business. The market for branded spices is worth Rs 3,000 crore and the DS group’s share is 3 per cent. Kumar plans to mount the new products on the existing distribution network for spices.
Meanwhile, the group has started to tinker with its packaging. Of late, the group has introduced in the South dispensers which can grind fresh, either manually or with a battery, five products: Crystal salt, pepper, garlic salt, fruit dressing and Italian seasoning. The foods category is growing fast. And only those with superior financial muscle power can stay there for long. The DS group is Rs 1,600 crore in size. Will that be good enough to take on entrenched players like Hindustan Unilever, Nestlé and ITC?
To be sure, Kumar has another business under Catch — spring water — which has brought him a fresh set of rivals like the Tata group, Coca-Cola, Pepsi and Bisleri. Kumar says Catch is a premium brand and competes only with imported products like Evian. Though the brand has been extended to flavoured water, soda and tonic water, there are supply constraints as the water is drawn from a spring between Kullu and Manali in Himachal Pradesh. There are large parts of the country where Catch beverages do not reach. Kumar surely wants to extend the business to newer categories. “Fruit juice is a good market,” says he.
Before that, he has come out with juice mixes in three Indian flavours — Mango Panna, Jaljeera and Nimbu Pani. There are small packs too, which retail for as little as Re 1 and Rs 2. These packs are aimed at the bottom of the market, and Kumar plans to retail these through the panwala network which the group anyway services with its pan masala, tobacco and mouth freshners.