Haldiram crossed $1 billion sales mark in India after business doubled over the past four years, with consumers preferring packaged namkeen over western snacks increasingly.
According to filings from Veratech Intelligence, the brand, divided into three geographic entities with nearly a dozen companies, posted combined revenue of Rs 7,130 crore during FY19, exceeding Mondelez India’s sales and parallel with the food and refreshment division of Hindustan UnileverNSE-0.14 percent.
Combined unit sales of Haldiram grew 14 percent from FY18’s Rs 6,241 crore. While it also operates restaurant chains, packaged snacks contributed more than 80 percent of the market leader’s sales.
“We understand the snacking habits of Indian consumers and make sure that operations including manufacturing and packaging are performed in-house to keep quality in check and adjust our portfolio quickly to meet changing trends. Also, since we are family-run, decision-making is faster, “a spokesperson for the Haldiram said. “We have less turnover compared to other customer companies and that helps to maintain stable management and coherent strategy.”
Haldiram operates out of New Delhi, Nagpur and Kolkata after the Agarwal family geographically divided the business among themselves in the 1990s. All of them are descendants of Gangabhisan ‘ Bhujiawala ‘ Agarwal who began his entrepreneurial journey in 1937 with a shop in Bikaner, Rajasthan. Haldiram is the largest label of those launched by the Agarwals, a family that also owns snack brands like Bikanervala, Bhikharam Chandamal, Bikaji, and Bikano.
“Traditional snacks market has always been there but it has been largely unorganized. Haldiram had a first-mover advantage which helped to push consumers towards branded namkeen, “said B Krishna Rao, Parle Products senior category head. “While the company is one, it has three different companies with distinct management and a larger scale of operations compared to rivals.”
Haldiram dominates a fifth of India’s snack market with revenue of Rs 6,571 crore last calendar year, increasing 12 percent to Rs 32,000 crore. While the growth rate decreased from 14% a year earlier, traditional snacks such as dal, chivra, bhujia, and nuts continue to grow faster than Western products.
Traditional namkeen outpaced western snacks a few years ago to become the largest sub-segment after attractive packaging and pricing by multinationals and domestic firms pushed their products into the hinterland.
That might have taken a toll on the bottom line, however. Haldiram said margins were under stress due to higher raw material costs and it was not able to hike product prices in a market that is becoming increasingly competitive.
The net profit of Haldiram rose 5 percent to crore Rs 694, which is less than 10 percent of its overall sales.
