Indian bakery and cereals industry is poised to grow at a high value CAGR of 9.9% over 2018–2023, says GlobalData

Growing economy and rising disposable income are driving the bakery & cereals sector in India, which is estimated to grow at a high compound annual growth rate (CAGR) of 9.9% from INR491.7bn (US$7.2bn) in 2018 to INR787.8bn (US$10.6bn) in 2023, says GlobalData, a leading data and analytics company.

GlobalData’s report, ‘Country Profile: Bakery & Cereals in India’, reveals that cookies (sweet biscuits) held the largest value share of 52.1%, followed by bread & rolls with 20.8% share in 2018. The breakfast cereals category is forecast to register the fastest value growth at a CAGR of 15.4%, followed by cereal bars with a value CAGR of 12.1% during 2018–2023.

Sneha Singh, Consumer Analyst at GlobalData, says: “Increasing public and foreign investments will create new employment opportunities in India, thereby increasing disposable income of consumers. The growing, working population looking for instant and nutritious products will in turn drive the Indian bakery & cereals sector.”

India’s value share in the Asia-Pacific (APAC) region is expected to increase from 6.5% in 2018 to 7.3% by 2023. The per capita consumption (PCC) of bakery & cereals in India, which was 4.4kg in 2018, is forecast to increase to 5.6kg by 2023; however, it is still low when compared to the global and regional levels.

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Breakfast cereals is the most consolidated category in the Indian bakery & cereals sector with the top three companies accounting for a combined value share of 89.9% in 2018, while, in the cookies (sweet biscuits) category, the top three companies accounted for a combined share of 77.5%.

Artisanal producers led the Indian bakery & cereals sector with a value share of 12% in 2018, while Parle G, Britannia and Sunfeast were the top three brands. Private labels grew at a CAGR of 12.5% during 2013–2018, whereas brands registered a CAGR of 11%.

In the bread & rolls category, private label products registered the highest growth at a CAGR of 14.5% during 2013–2018, followed by breakfast cereals, and cakes, pastries & sweet pies with CAGRs of 13.9% and 13.6%, respectively. Convenience stores and food & drinks specialists were the key channels for purchasing bakery & cereals in India.

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Singh concludes: “With growing health consciousness, Indian consumers are increasingly seeking products with claims such as ‘multi-grain’, ‘source of fiber’, ‘fat-free’, and ‘sugar-free’. This trend is expected to gain momentum in the foreseeable future.”

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