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NEW DELHI, April 25

THE Gujarat Cooperative Milk Marketing Federation (GCMMF or Amul) has launched its ice cream in Delhi, setting the stage for a three-cornered tussle with Kwality Walls and Mother Dairy for the country's largest market for ice creams.

Delhi currently accounts for around 18 per cent of the country's estimated Rs 525 crore organised ice cream market of 80.8 million litres. It also boasts of a per capita annual ice cream consumption of 1.45 litres, as against the national average of 0.25 litres.

The Delhi market is currently dominated by Hindustan Lever Ltd's (HLL) Kwality Walls and Mother Dairy, which is a brand of Amul's sister cooperative concern, National Dairy Development Board (NDDB). Both Kwality Walls and Mother Dairy now sell 6.5-7 million litres each of ice creams in Delhi.

"As a third entrant, we hope to capture 25 per cent of the market in two years' time. And this will come not at the expense of Mother Dairy, but Kwality Walls," said Mr Vipul Mittal, Manager (Sales), GCMMF.

Amul has priced its ice cream at Rs 65 for a 1,250 ml Vanilla brick, which is what Kwality Walls and Mother Dairy are charging for a similar pack of 750 ml and 1,200 ml respectively. Similarly, it is selling a 100 ml Vanilla cup for Rs 10, which is the same as Mother Dairy, whereas Kwality Walls is charging the same for an 80 ml cup.

"By ensuring that our prices are more or less the same as that of Mother Dairy, but much lower than that of Kwality Walls, we hope to increase the market share of the cooperative sector in the Delhi market," Mr Mittal said. He ruled out the possibility that Amul's `cooperative competition' with Mother Dairy would actually end up in the two cooperatives eating into each other's rather than KwalityWalls' share.

Delhi is a market that is expanding by 20 per cent each year. On the other hand, Mother Dairy's plant here has capacity constraints to cater to this expanding market. Our presence would ensure that the incremental market will not accrue to Kwality Walls alone," he added.

In fact, Amul, till recently, was using Mother Dairy's facility to manufacture its ice cream for the neighbouring markets such as Faridabad, Gurgaon and Ghaziabad. But from now on, Amul will source its entire ice cream requirement (including for Delhi) from its own Gandhinagar plant.

Amul claims to have already deployed 1,000-odd deep freezers in the last 15 days in Delhi under its `Hamara Apna Deep Freezer (HADF)' scheme. Under this, retailers are encouraged to buy their own deep freezers for vending ice creams, with Amul negotiating a discounted price on their behalf with refrigeration companies like Blue Star, Voltas and Carrier.

This is as against the practice of the ice cream company itself providing the freezer at the retailer's end, subject to the latter depositing a refundable security amount. "In the HADF scheme, the retailer not only saves on the security deposit, but also enjoys the flexibility arising from owning the asset and availing a direct five-year guarantee from the manufacturer. These, together with our negotiating a discounted price on their behalf, entails cost savings of Rs 5,000-8,000 per freezer depending on capacity and make," Mr Mittal said.

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