This summer will be cooler for ice-cream lovers as their favourite scoops are unlikely to get more expensive. With raw material costs remaining low and higher demand anticipated, top ice-cream makers in the state will refrain from hiking prices this summer.
“There is no price revision in end products. Generally, ice-cream prices increase before summer but this season, after many years, we are not going for any hike,” said Rajesh Gandhi, managing director of Vadilal Industries Ltd.
Prices of skimmed milk powder (SPM), a key raw material for ice-cream, have come down substantially, offering ice-cream makers room to keep retail prices unchanged.
“The world over, commodities prices have eased. SMP price has declined to Rs 140 per kg from Rs 225 last year,” said R S Sodhi, managing director, Gujarat Co-operative Milk Marketing Federation (GCMMF), which markets milk products under the Amul brand.
Other ingredients such as milk cream, fat, sugar and dry fruits have become a bit costlier. “Although the prices of these commodities have increased, they are still lower than price levels seen two years ago. Last year retail prices had to be increased to offset higher costs,” said Ankit Chona, MD, Havmor Ice Cream Ltd.
There were also expectations that the excise duty on ice-cream would be raised in the budget. However, that has not happened, providing a cushion to the ice-cream industry. “There may be a price cut in select ice-cream products,” Chona added.
Industry players estimate dem’and to grow by 15-20% in 2016-17. All three major ice-cream players have seen a good start to the summer with spurts in sales and they anticipate sales to grow by 20-25% this year.
As competition is set to heat up, Amul, Vadilal and Havmor have decided to launch new flaours and step up their marketing spend to grab a bigger chunk of the Rs 4,000 crore organized ice-cream market in the country. Gujarat accounts for 20% of India’s ice-cream market. The major focus this year is on the premium and kids segments.