Bagrrys India Unlisted Shares Essentials

Market Overview.

• The breakfast and cereal market of India is growing at a very healthy CAGR of approx 18.0% over the last five years. 
• The ready to eat sector in the Indian market dominates the breakfast and cereal market with its two categories namely cornflakes and muesli. At present cornflakes products is the market dominator in RTE sector as well as in the overall market. 
• The market was mainly driven by India-centric innovations and single-serve affordable packs that attracted new consumers. 
• Kellogg’s is considered as the most prominent company in cornflakes market with its large number of variants available in the market.
• The health driven changes in eating habits has extended the window of opportunity for manufacturers to roll out a variety of oat-based products in the market.

Investment Scenario:

• The Government has allowed 100% Foreign Direct Investment (FDI) in food processing and single-brand retail and 51% in multi-brand retail
• In February 2021, Nestle India announced plans to reach 1.2 lakh villages (with each having population of over 5,000) over the next 2-3 years
• In February 2021, Food and snack company, Haldiram's partnered with Africa's Futurelife to bring its nutritional food product range to India. The two companies launched a range of four products—Smart Foods, Smart Oats and Ancient Grains, Crunchy Granola and High Protein
• On November 11, 2020, Union Cabinet approved the production-linked incentive (PLI) scheme in 10 key sectors (including electronics and white goods) to boost India’s manufacturing capabilities, exports and promote the ‘Atmanirbhar Bharat’ initiative

Future Outlook

• Rural consumption has increased, led by a combination of increasing income and higher aspiration levels. There is an increased demand for branded products in rural India. The rural FMCG market in India is expected to grow to INR 16 lakh Cr. by 2025 from INR 1.7 lakh Cr. in FY18.
• Online portals are expected to play a key role for companies trying to enter the hinterlands. Internet has contributed in a big way, facilitating a cheaper and more convenient mode to increase a company’s reach. 
• The number of internet users in India is likely to reach 100 Cr. by 2025. It is estimated that 40% of all FMCG consumption in India will be made online by 2020. The online FMCG market is forecast to reach INR 3.2 lakh Cr. in 2020 from INR 1.4 lakh Cr. in 2017