For Dabur, almost 20% of the company’s total sales come from southern markets including Tamil Nadu.
NEW DELHI, Aug 22
Consumer goods major Dabur India will invest Rs 400 crore in Tamil Nadu to set up a new plant, marking its first manufacturing foray in the south.
On Thursday, the company signed a memorandum of understanding (MoU) with the Tamil Nadu government to establish a state-of-the-art manufacturing plant in the SIPCOT Food Park, located in Tamil Nadu’s Villupuram district. The company will invest Rs 135 crore in phase I, scaling up to Rs 400 crore over a period of five years. The project is expected to generate direct employment for around 250 people.
The move to set up a plant comes as Dabur looks to scale up its business in the south, aiming to address region-specific needs, a strategy that most fast-moving consumer goods (FMCG) companies are aggressively pursuing in their quest for growth. At present, Dabur has 14 manufacturing plants across the country, mainly in the northern and central parts of the country. The Tamil Nadu unit would be its 15th plant and may pave the way for more such factories in the south, company officials said.
Tamil Nadu industries minister TRB Rajaa announced the development on Twitter, highlighting the opportunities this facility will create for farmers in the nearby Cauvery delta region, enabling them to supply agro-produce for processing in the new facility. Last year, Godrej Consumer had announced a Rs 515-crore investment in Tamil Nadu to manufacture brands such as Cinthol, Godrej Expert Rich Creme and Goodknight. Biscuit major Britannia too has stepped up its investment in Tamil Nadu in recent years, investing around Rs 500-700 crore to enhance existing manufacturing capacity in the state. Firms such as Hindustan Unilever, Procter & Gamble and Tata Consumer Products have manufacturing operations in Tamil Nadu, among the largest markets in the south for FMCG products.
For Dabur, almost 20% of the company’s total sales come from southern markets including Tamil Nadu, Dabur India CEO Mohit Malhotra had told FE earlier. On Thursday, Malhotra said that the investment would help the firm manufacture a wide range of products including food products, ayurvedic medicines and health supplements, helping the company to strengthen its presence in the region. The company is eyeing around 25% of its total turnover from southern markets in the future. The 140-year old company’s portfolio includes Dabur Chyawanprash, Dabur Honey, Dabur Pudin Hara in the healthcare space, Dabur Amla and Dabur Red Paste under personal care and Real fruit juices in the food & beverages category.
