ITC rolls out Bingo to take on Frito Lay`s

Snack foods major Frito Lay’s could finally be getting a taste of serious competition in India. FMCG major ITC today announced its entry into the branded snack food market through the launch of ‘Bingo’ range of snacks.

The tobacco-to-hotels conglomerate hopes to capture 25 per cent market share in Rs 2,000 crore branded segment. ITC will invest about Rs 350 crore in the next four years through its foods division.

Currently, the size of the snack food market is estimated to be Rs 4,500-5,000 crore of which branded players account for Rs 2,000 crore. The snack food market is growing at 30 per cent annually and foods and beverage giant Pepsico’s Frito Lays is the dominant market leader with a market share in excess of 80 per cent.

While ITC will invest around Rs 200 crore in setting up of three new plants for snack food in the northern Indian state Uttarakhand, investments of Rs 150 crore will be made in the development, roll-out, branding and marketing exercise of ‘Bingo’.

“In next two years, we will be investing Rs 150 crore on ‘Bingo’. Already, we have invested about Rs 60-70 crore for the development of snack food range,” Ravi Naware, chief executive of ITC Foods Division said at the launch of ‘Bingo’ range of snacks.

Bingo snacks will be available in the packets of Rs 5 and Rs 10 across India within next 15 days, Naware said.

He said in the next one year one more plant would be set up to add to its existing snacks plant near Haridwar. “Besides, in the next three to four years we are looking to have two more plants to have complete presence in all the regions of the country,” Naware said.

ITC has also undertaken a reclassification of its ‘ready-to-eat’ and ‘to-be-cooked’ foods under ‘Kitchens of India’ and ‘Aashirvaad’ brands respectively as it looks to rev up the business in this segment.

After the reclassification, ready-to-eat food such as ‘Aashirvaad rajma chawal’ will be sold under the ‘Kitchen of India’ brand. Naware said the foods business had clocked a 60 per cent overall growth rate last year and was looking at maintaining the pace of growth.

ITC’s Sunfeast biscuits clocked 60 per cent last year, cornering about 8 per cent market share while the other product categories like the ‘Aashirvaad’ brand atta enjoy 55 per cent of Rs 1,000 crore organised market, he said. The brand also has salt, spices and mixes under it.

In confectioneries, ITC enjoys a market share of 14 per cent of the segment where it is present, which is estimated to be valued at Rs 2,000 crore.