Nestle India on Tuesday announced the launch of NesPlus a range of breakfast cereals for kids and adults alike. The breakfast cereals, called NesPlus, come in four multi-grain variants — Kakos, Choco-Burst Fillows, Strawberry-Burst Fillows, and Nutty Honey Granola. A key characteristic of the product is that it remains crunchy in warm milk.
Nesplus is a brand owned by Nestlé Breakfast Cereals from Cereal Partners Worldwide (CPW), a joint venture between Nestle SA and US firm General Mills. With the launch of NesPlus, the company hopes to crack a market where a majority of the 1.3bn people still prefer freshly-made Indian breakfast.
NIL will be competing with Kellogg’s, PepsiCo’s Quaker, and a few other multinational as well as local firms such as Bagrry’s India, Marico Ltd, ITC Ltd, MTR Foods, and Dr. Oetkers. These companies have made inroads into the breakfast market with products such as muesli and oats as well as ready-to-cook Indian foods like dosa, idli, uttapam, and dhokla.
US-based Kellogg’s dominates India’s packaged breakfast cereal market with a 37% share (value terms, as per industry reports). PepsiCo India Holdings, the local unit of PepsiCo, is present in ready-to-eat idli, dosa, upma, and khichdi foods and had a 13.3% share (value) in 2015, last reported by market research firm Euromonitor International. As per industry reports, India’s breakfast cereal market is projected to touch Rs2,610cr by FY20E (as per Euromonitor).
NIL operates primarily in four segments, i.e. milk food and nutrition (Nestle), chocolates and confectionary (KitKat, Munch, Bar One), prepared dishes (Maggi), and beverages (Nescafe). Milk products are the highest contributor to its revenues, with ~50% share, followed by prepared dishes at ~25%. NIL has successfully re-built its core (post the 2015 fiasco) and gained back its leadership position for Maggi, gaining 60% market share. Additionally, NIL is keen on bringing few global brands to India. It had launched more than 30 products in CY17.
Nestle India share price is currently at Rs9,800, up Rs28.2, or 0.29%, from its previous close of Rs9,771.80 on the BSE.