Ice cream brands to flood market with new launches at higher prices

Source : Times of India
The Rs 2,250 crore organized ice cream market in the country is all set to sizzle this summer. With manufacturers all set to introduce new variety of ice-creams and new launches. So as to cater to the taste buds of the consumers and increase their market share.
Majority of ice-cream players have already chalked out plans and strategies so as to make the best out of the summers. But, consumers have to shell out extra, for relishing the delicacies. Thanks to Union budget. As transportation of milk products has been brought under the service tax ambit. Including ice-creams.

Before the budget, transportation of milk products was exempted from service tax. Now, service tax of 14% is applicable on transportation of milk products including ice-creams.

“As a result of the announcement, ice-cream products are going to get costlier by 2 to 3% this summer,” said Pradeep Chona, chairman of Have more Ice Cream Limited.

Amul which has enjoys 40% share of the domestic ice-cream market is also feeling the heat of the budget announcement. “Our costing on the final product will increase by 2-3%. As we have to factor in the imposition of service tax on transportation of dairy products. Earlier, there was no such tax. Hence the hike is from 0 to 14%. This will impact the prices sooner or later,” said R S Sodhi, managing director of Gujarat Co-operative Milk Marketing Federation that markets brand Amul.

“We will try to absorb the burden as the cost of raw material and diesel prices are lower than last year,” said Rajesh Gandhi, managing director of Vadilal Industries Limited, the makers of Vadilal brand of ice-creams. “The fact remains that service tax burden will be substantial on all the players.”
Nonetheless, an ice-cream war has started in the national capital with Amul launching ‘Epic’ in the new super-premium category to counter Kwality Walls Magnum ice-cream – touted to be world’s largest selling stick variety.
After the launch in Delhi, ‘Epic’ will be launched in other major markets across the country by end of this month. Also, the dairy major will be launching sugar free and flaavyo frozen yogurt in cones – both the cones that will be introduced for the first time in the world.

Ahmedabad-based Vadilal too plans to launch 4-5 ice cream products in premium segment this summer.

Another player-Havmor Ice Cream is also gearing up to bank on its Signature range of premium ice creams apart from bringing in fresh fruit flavors such as mango, orange and sitafal.