Manpasand Beverages, makers of Mango Sip fruit drink, plans to expand aggressively across India and abroad and also enhance its production capacity, after stitching an ambitious distribution pact with Parle Products for the domestic market.
“Besides expansion across the country, we are also looking to expand into other countries including those served by global beverage giants as consumers globally are shifting to health-focussed beverages and the market is growing exponentially,” the company’s Chairman and Managing Director Dhirendra Singh told PTI.
According to a PTI report: Asked about whether the company was in a position to take on global giants like Coca-Cola and PepsiCo which have also been betting big on the juice market, Singh told PTI, “We welcome competition and are confident of facing the same.
“We understand the preferences and aspirations of rural consumer way better than the competition and are confident of offering new products as per the regional tastes.”
In an interview to PTI, Singh said, “With our experience on expanding from the ground within India, we are now confident of taking on multinational giants within our country and also in other countries.”
Manpasand, which became the country’s first listed non-alcoholic beverages firm with an IPO in June 2015, has been hailed as a success story of disruptive business model with a strong focus on consumers in the rural and semi-urban India with a strong portfolio of Rs 5-10 per pack products.
However, it had to endure negative sentiments recently when its long-serving auditor resigned and the company’s market cap took a hit of about 50 percent in a fortnight.
Singh said it was an abberation and the company has already declared its results, audited by the new auditor.
“The auditor issue was an aberration and our results have also been already audited by the new auditor. These issues are now things of past and we have already started working on our expansion plans within India and abroad,” he told PTI.
Talking about the new tie-up with Parle Products, the maker of famous Parle-G biscuits, Singh said it is a win-win situation for both the companies.
For Manpasand, it is a ten-fold jump in market access as it gives it the largest distribution network of 60 lakh retail outlets and 10,000 distributors in India.
Non-alcoholic beverage market is the fastest growing segment in India with total market size of Rs 13,500 crore. The juice market in India is estimated to grow at a rate of 23 percent till FY2021, as compared to 9.6 per cent for the carbonated drinks market. Within this segment, the mango drink segment contributes more than 50 percent.
Singh, who studied in Varanasi and first tested his products in the western Uttar Pradesh, said the rural segment presently accounts for one-third of the total market, is set to grow to 50 percent in next five years on back of rising income levels, competitive products and favourable price offerings.
Singh said the exclusive 10-year distribution arrangement with Parle Products, coupled with accelerated growth plans, would help the company expand its consumer base quickly.
” Through the agreement, Manpasand will offer products on Health-for-All plank in the form of combo packs consisting of products like MangoSip and Parle-G biscuits at most affordable price points and thereby fulfilling the aspirations of consumers in rural and semi-urban markets,” he was quoted by PTI as saying.
For Parle Products, the arrangement will complement its objectives of new growth in premium product range in modern trade while maintaining steady growth in traditional trade.
Singh, who served in a government job before going the entrepreneurship way, said the company would expand its production capacity to meet the demand from an expanded distribution network and for its expansion into newer markets.
In the last two years, the company has invested around Rs 600 crore, funded completely from Initial Public Offer and the Qualified Institutional Placement to expand its production base to nine manufacturing facilities spread in five states.
Manpasand presently has five manufacturing facilities — two in Vadodara and one each in Ambala, Varanasi and Dehradun.
The four new facilities will be up and running by the third quarter of the current financial year, after which the total capacity will rise to 3.5 lach SKU (stock keeping unit) per day.
“With our new distribution pact with Parle Products, we will need a quantum jump in our supply to distributors and retailers. We are planning to expand our production capacity across the country as well to meet this demand,” he said.
Besides expansion across the country, the company is also looking to expand into other countries including those served by global beverage giants as consumers globally are shifting to health-focussed beverages and the market is growing exponentially, Singh said.
He said the company’s business model is focussed on offering products as per the regional tastes.
“Whether it is India or any other country, the shift away from carbonated drinks and the continuing emergence of health-conscious consumers in the beverages market suits our business model very well,” he further told PTI.
“Our focus is on serving the consumers with the right mix of products, while also keeping in mind the interest of distributors and retailers,” Singh was quoted by PTI as saying.
Last week, the company reported sales of Rs 984.95 crore for the year ended March 2018 and profit after tax of Rs 99 crore with a 37.7 percent growth.