The Indian subsidiary of Borges, the Spain-based maker of snacks and cooking medium, will launch instant popcorns in six months taking on Agrotech Foods, a subsidiary of North American foods major, Congra.
Borges has already launched the microwave variant under the Popitas brand in June this year.
"But we see mass play happening in the instant segment," said Rajneesh Bhasin, managing director, Borges India. Agrotech has the popular Act II brand of popcorns in India. Variants include popcorns for microwave and pressure cooker.
Internationally, in-home consumption of popcorns use microwave ovens. But given the low penetration of microwaves in India, both Borges and Agrotech are focusing on pressure cooker users.
As things stand now, the popcorn market in India is pegged at Rs 1,000 crore (Rs 10 billion).
Of this, out-of-home consumption -- in malls, multiplexes and cinema halls, among others -- comprises 90 per cent of the market.
The balance 10 per cent is the in-home market, which is growing at 35 per cent annually. The out-of-home market is growing at 15-20 per cent, said industry experts.
Agrotech has a headstart over rivals in the in-home market with its Act II brand having been around for close to a decade now.
The pressure cooker variety was created by Agrotech, say experts, about four years ago.
"It has been the only player so far in the pressure cooker segment. But that won't be for long," said Bhasin.
Agrotech, for instance, is said to be deriving most of its Rs 70 crore (Rs 700 million) turnover from popcorns through the instant market.
Typically, a 60-gram pack of Act II in the instant segment is priced at Rs 10. It now has a smaller Rs 5 pack as well.
In the microwave segment,on the other hand, an 85-gram of Act II costs Rs 35. Popitas has been competitively priced at Rs 39 for a 100-gram pack, said Bhasin.
The microwave market also has imported brands such as American Garden among others, said experts, which are predictably higher priced than the ones that have a local presence.
Both Agrotech and Borges, incidentally, import maize from Argentina, which is then processed in India.
"The cost does not escalate because there is a 35 per cent duty subsidy when you import corn in bulk," said Bhasin. Agrotech, processes maize at two plants in India, while Borges processes it for its recently-launched microwave variant in Spain, which is then routed back to India.
"We intend to move processing of this variant to India in the medium to long term," he said.
