ITC to enter Frozen Foods Segment

ITC Foods has drawn up plans to foray into the nascent frozen foods category in the domestic market within the next six-eight months. The company will extend its Kitchen of India brand to frozen foods, which would include meals packaged in trays and snacks. ITC recently began exporting frozen vegetarian foods to markets such as the US and Canada, since exporting non-vegetarian foods out of India is restricted. The company is manufacturing the frozen foods range at its Bangalore facility, and will use the same to cater to the domestic market as well, ITC Foods CEO Ravi Naware said.This will be seventh food category ITC Foods will tap after kitchen ingredients such as atta, salt and spice, biscuits under the Sunfeast range, confectionery, ready-to-eat foods under the Aashirvaad range, instant mixes and pastas, and potato chips and snacks under the Bingo range.The frozen foods market is still nascent in India, estimated at only about Rs 25-30 crore. Players in this category are limited and include Kohinoor Foods and Al Kabeer, in addition to a handful of other regional players. Issues such as freshness and taste have posed as hindrances to growth of this category in the Indian market. Asked whether the food division planned to tap newer categories in the short term, Mr Naware said: “We have lot of ground to cover in existing categories. Plans are underway to expand the confectionery and snack foods range.” On Thursday, ITC announced that its branded packaged food sales grew by 23% during the April-June 2008 quarter, though its net profits fell for the first time in nine quarters. In addition to increase in excise duties in cigarettes, the company attributed the drop in profits to continued brandbuilding costs in the food business.