Chocolate Industry

INDUSTRY ANALYSIS-

The chocolate industry in India -

* It has a size of 20000 tones and is worth about Rs 400crores. The chocolate market has been growing by nearly 35 %. However there has been some slowdown in the last two years.The chocolate market is predominantly urban with coverage of 95 %. The sales volume has decreased by 5% in the last year and the chocolate market had declined with the average consumption coming down by 25% from 16000 tones to the current levelof125000 tones. Chocolate consumption in India is extremely low. Per capita consumption is around160gms in the urban areas, compared to 8-10kg in the developed countries. In rural areas, it is even lower. Chocolates in India are consumed as indulgence and not as a snack food. A strong volume growth was witnessed in the early 90s when Cadbury repositioned chocolates from children to adult consumption .

* The biggest opportunity is likely to stem from increasing the consumer base. Leading players like Cadbury and Nestle have been attempting to do this by value for money offerings, which are affordable to the masses .

* Cadbury, a subsidiary of Cadbury Schweppes is a dominating player in the Indian chocolate market with strong brands like Dairy Milk, Five Star, Perk, and Gemsetc. Dairy milk is the largest chocolate brand in India.

* Chocolates & Confectionery contribute to 75% of Cadbury‘s turnover. Cadbury also has a strong brand Bourn vita in the malted health drink category, which accounts for 24% of turnover.

* The parent Cadbury Schweppes during 2001 made an open offer for acquiring the 49% non-promoter holding in the company. It has already acquired over 90% of the equity and proposes to buy back the balance equity and delist the stock from Indian bourses..

Industry Trends-

* There are a number of trends within the chocolate industry that are driving growth; and product innovation in 2010 brought a 16% increase in new product releases over 2009....