The PHD Chamber of Commerce and Industry has projected that the size of ice cream industry, estimated at Rs 4,500 crore in 2013 is likely to jump at about Rs 7,000 crore by 2018 with its growing institutional sales coupled with youngsters spending habits on it as well as increasing disposable income of middle and lower middle class Indians in the recent times.
The domestic ice cream industry would grow at the compounded growth rate (CAGR) of about 25 percent in future with high profit margins ranging between 15 to 20 percent to reach the projected level since its per capita consumption has gone up at 300 ml against world average of 2.3 litre, said Sharad Jaipuria, President, PHD Chamber.
The projections of the ice cream industry are based on the presentation made to the Chamber at a recent seminar which estimates that the market size of Indian frozen food industry could exceed many fold from its anticipated estimate of Rs 12,500 by 2014-15.
The trends responsible for the growth of ice cream industry in India in particular and that of frozen food industry follow large investments in advertising and infrastructure development, diversification of product portfolio targeting specific consumer segments and entry of multinationals into the business.
Other factors that are credited to fuel the growth of ice cream industry consist of partnership and franchises pursued to boost distribution and increasing cost of raw materials offsetting the higher margins, pointed out Jaipuria.