D D Modi group company Modi Naturals, which is the largest producer of rice bran in India, plans to establish itself as a health and wellness company over the next three years.
The Bombay Stock Exchange (BSE) listed firm, which was founded in 1974, has stayed away from the direct consumer business till recently as it preferred focussing on the core commodities business.
But when Akshay Modi, the third generation in the business, joined the family business after his education abroad and briefly working with a consulting firm, he wanted to try his luck in the direct consumer business.
In 2010, the company entered the direct consumer segment with a mustard oil brand ‘Tarai Shudh’ in the north and eastern parts of the country.
“Within a year or two, we expect the commodities and consumer business to be equal in revenue terms,” said CEO Akshay Modi, adding that the company would invest about Rs 100 crore in next three years. It had reported revenue of Rs 195 crore in fiscal year ended 2013, of which a very small percentage comes from the consumer business.
It has recently launched premium olive oil ‘Oleev’ in four variants in Kolkata. “This one is our first step towards the health and wellness segment. We started this brand with Kolkata market, and would launch this nationwide over the next couple of months,” he added.
“We target to establish ourselves as a health and wellness product company and all our future launches would be restricted in this segment. However, there is no plan to tap the food space,” Modi said.
Currently it has about 150 distributors and mainly sales through modern trade. “We will start pushing our products through general trade in next three to six months and would double distributors by end of this year,” he added.
Only the wellness industry in India is estimated to touch Rs 100,000 crore (Rs 1 trillion) by 2015, with a compounded annual growth rate of 15-17%, from about Rs 70,000 crore in 2012, according to a recent study by global consulting firm PricewaterhouseCoopers (PwC).
