Future Group to foray into food manufacturing
Amid debt challenges and margin pressures in the retail sector, Future Group’s foray into food manufacturing will kick-start with Modi inaugurating the first of its three mega food parks in Tumkur, near Bangalore, on Wednesday.business Updated: Sep 23, 2014 23:35 IST
Amid debt challenges and margin pressures in the retail sector, Kishore Biyani-led Future Group’s foray into food manufacturing will kick-start with Prime Minister Narendra Modi inaugurating the first of its three mega food parks in Tumkur, near Bangalore, on Wednesday.
The high margins garnered by food companies in comparison to retailers prompted Future Group to expand into the food processing, manufacturing and branding business.
Future Consumer Enter-prise’s (earlier known as Future Ventures) Integrated Food Park Holding Ltd will have three food parks — cluster of food processing units — one each in south, east and central India to supply to hundreds of Future’s retail outlets.
While many of these units are run by third party firms, Future will have a stake in them.
Expectedly, Biyani has hopes pinned on his new venture. “We have real potential to be the largest FMCG company in India. Our aim is that, by 2019, 70-80% of food products we sell in our stores should be our own. This can generate revenues worth Rs. 20,000 crore,” said Biyani. “I believe this is going to be a game changer. This will be a rasoi (kitchen) for our own distribution chains,” he said.
Once fully operational, the 110-acre Tumkur food park will house 50 food processing units, which will together bring out about 10,000 various food products.
The food park has been made with an investment of Rs. 1,000 crore. Future has also been allotted 65 acres of land in Kharagpur in West Bengal to set up a food park with an investment of Rs. 600 crore.
Biyani said the company will finalise the deal with Madhya Pradesh government for 100 acres of land for its third food park, which will supply its retail chains across north and central India, in 10-12 days.
Future Group is also in advanced stages of talks with the South India-based supermarket chain Nilgiri to strengthen its retail presence in the region.
Biyani said food products from these food parks will be sold to other retail chains such as Walmart, Metro and West Asia-based Choithrams.
First Published: Sep 23, 2014 23:31 IST