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HLL lines up spices foray

Reeba Zachariah in Mumbai

Will Hindustan Lever be third time lucky? The consumer products giant is making a re-entry into the spices business for the third time, this time under the Knorr brand, which it acquired from International Bestfoods.

HLL is currently test marketing certain spices in Bangalore and a national roll out is expected soon.

It is learnt that HLL has launched several variants: basic (chilli, turmeric and coriander) and blend (sambhar masala and rasam masala) under the Knorr Annapurna brand. Annapurna is HLL's flagship brand in the foods business.

HLL believes spices is a big market in India and there lies tremendous potential for it.

The spices market is believed to be worth around Rs 10,000 crore (Rs 100 billion) of which the branded segment constitutes just Rs 600 crore (Rs 6 billion). The major players in the market include Badshah, Everest and MDH.

Earlier, HLL had a presence in the spices market with the Sona masala brand, which came with subsidiary Brooke Bond India.

HLL withdrew the Sona brand as it did not perform well due to the lack of any product differentiation.

After 10 years, the company re-entered the spices market under the Kissan brand in 2000. The Kissan range of spices was test-marketed in Andhra Pradesh, but again the brand was withdrawn.

The Kissan brand did not go well with spices, analysts say, as it was more attached to products like fruit drinks, ketchup etc. The Knorr range is priced at par with competitiors.

HLL's foray into the Indian spices market raises the prospects of keener competition in the organised spices market.

The challenge is to upgrade consumers and the issue is to convince them that branded spices are better than home-made/loose spices, analysts said.

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