Ahmedabad’s Havmor ice cream expands to Delhi, NCR

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New Delhi: What’s common between former US president Bill Clinton and astronaut Sunita Williams? Both of them during their visits to India had desserts prepared by Havmor, an ice cream brand based in Ahmedabad. Havmor was also served at the wedding reception of Karan Adani, son of Gautam Adani, the chief of the $17.5 billion Adani Group.

The legacy brand from Gujarat is finally getting out of its comfort zone and, on Tuesday, announced its entry into Delhi and the National Capital Region as part of the strategy to establish its presence across the nation with an aim to cross Rs.1,000 crore in revenue by 2020, up from nearlyRs.450 crore in March 2016.

Over the next three years, Havmor will spend Rs.225-250 crore in setting up a new facility at Faridabad to cater to the northern markets, expand capacity at existing plants in Gujarat from 2.5 lakh litre a day to 3.5 lakh litre, and marketing and communications, said Ankit Chona, managing director, Havmor Ice Cream Ltd.

The brand will also enter Uttar Pradesh, Karnataka, Andhra Pradesh and Chhattisgarh this fiscal. “The money will come from internal accruals and bank loans,” he added.

Currently, Havmor operates 200 exclusive outlets, is available across 30,000 retail outlets and sells 160 flavours. The company is eyeing expansion in smaller towns and working on possible extensions of the Havmor brand. “We have been discussing many things, including yogurt. Nothing has been finalised yet. We’re considering extension of brand Havmor, and, may be, new brands that could supplement our existing businesses,” Chona said.

Chona is the grandson of Satish Chandra Chona who started Havmor at a small shop in Karachi (now in Pakistan) in 1944 and then resumed the journey in 1953 (in Ahmedabad) post Partition.

Until 2007, Havmor was restricted to Gujarat. Havmor chairman Pradeep Chona, the second generation in the business, was happy with the brand’s success and legacy although the scale of the business was limited. But the third generation was restless and Ankit Chona wanted to leverage the brand’s potential. He returned to India in 2005 (after studying at Purdue University in the US and doing an internship at Panera Bread, a bakery cafe chain in the US and Canada) when Havmor had a revenue of around Rs.40 crore.

However, his father initially entrusted him with the task of running the company’s restaurant business under the same brand name. He scaled up the business from two restaurants and two fast food joints to 16 restaurants and 50 fast food joints, which together account for about 15% of the group’s revenue.

Meanwhile, Havmor stepped outside Gujarat, opened stores in Mumbai and other parts of Maharashtra as well as in Rajasthan.

The ice cream market in India has seen a bunch of mass and premium brands entering India in the past year. In July, Nestle-owned premium ice cream brand Mövenpick announced plans to open 50 outlets in India, and Arizona-based Cold Stone Creamery, which is known for its fresh handcrafted ice cream Made Fresh, said in July 2015 it would open 40 stores in five years.

Brands like Häagen-Dazs, London Dairy, Hindustan Unilever’s Magnum, Baskin Robbins, Gelato Vinto, Mumbai-based Naturals, Mother Dairy, Kwality Walls, and Cream Bell, among others, have a strong presence in either specific regions or nationwide.

The ice cream market in India is estimated to grow to Rs.6,198 crore in 2019 from Rs.4,160 crore in 2014, according to an April 2015 study by research firm Euromonitor International. The overall ice cream market in India is dominated by Amul, a brand owned by the Gujarat Cooperative Milk Marketing Federation, with a 32% share, according to the study.

A separate study by consulting firm Technopak Advisors maintains that the ice cream market in India is still at a nascent stage. Annual per capita consumption of ice cream in India is just around 300ml as compared with about 22,000ml in the US and about 3,000ml in China, it says.