The Bel Group is set to acquire a 49% stake in a subsidiary owned by India food giant Britannia Industries. The multi-national will take a stake in Britannia Dairy Private Limited, which will become a joint venture company called Britannia Bel Foods Private Limited. The remaining 51% will be held by Britannia.
The new entity will be led by Abhishek Sinha, Britannia’s chief business officer, dairy, which will manufacture, distribute and sell cheese products in the country. The products will be co-branded using the trademarks ‘The Laughing Cow’ and ‘Britannia’.
Cécile Béliot, BEL Group CEO, said: “This strategic partnership with Britannia in India is a new step for Bel Group’s development in Asia, in line with our mission to deliver healthier and more responsible food for all. Thanks to this joint venture, we will accelerate in India, after 4 years of presence in “start-up mode” which had enabled us to confirm the relevance and the potential of our product offers.
“Perspectives in India are strong and very promising in the nascent cheese segment. We are proud to partner with Britannia. They have an emblematic brand in India and a powerful distribution system. By combining their expertise with our iconic brand The Laughing Cow, and our know-how and knowledge of cheese products, this joint venture is well positioned to offer to all Indian consumers, delicious, nutritious and accessible cheese products, and become a leader in the fast-growing Indian cheese market”.
Varun Berry, executive vice-chairman and MD at Britannia Industries, added: “Britannia’s partnership with Bel Group will enable consumers to enjoy international quality cheese products that will now be made in India. As an indigenous Indian Company, we are proud to be an integral part of the Prime Minister’s vision of an Atmanirbhar Bharat as we manufacture the best of delicious, nutritious and accessible products from across the World for the people of India. We will serve delightful cheese experiences to consumers for all times of the day, thereby creating new consumption occasions. This JV will help the milk farmers of Maharashtra gain consistent and greater market access through our yield-optimized, milk collection initiative that has grown significantly over the last three years.
"Cheese is an under-penetrated category and this partnership will help expand the nascent but fast growing cheese category by delivering innovative products and being a leader in fulfilling evolving consumer needs. This JV is also key to Britannia’s vision to be a responsible, total foods company”.
Bel’s growing influence in Asia
With production hubs running in Iran, Egypt, Vietnam and Japan, the Bel Group has moved to strengthened its influence on the Asian market during 2022.
During the summer, the multi-national entered a JV with China’s Shandong Junjun Cheese Co., taking a 70% stake in the cheese producer including access to operate its factory. Bel Group CEO Béliot said at the time that the JV would enable Bel to scale up its production output on the Chinese market and ‘compete for leadership’. A company spokesperson described Shandong as ‘a local player with strong financial, industrial and R&D capabilities’.
According to Statista, China is the largest dairy market on sales revenue, with dairy products expected in the future. Sales of cheese in particular are projected to grow by 11.5% to 2024, according to Statista.
While China offers exciting possibilities for manufacturers looking to tap into a promising market, India has the largest dairy industry globally – and milk production there is growing at a rate of over 6%, faster than the global rate of 2%. Competition among several key players including Mother Dairy, Amul and Dudhsagar Dairy is also robust. Bel’s JV with Britannia – one of the country’s oldest and most well-known brands on the Indian market, with a reach across half of Indian households – could establish the multi-national among those key players.
There are no signs of a slowdown in the Indian cheese market, either – the segment is projected to grow at a rate of more than 8% CAGR between 2022 and 2027, with a volume growth of 6.7% for 2023 alone.