Australia’s FAL Food and Beverages to enter India & export from India

Australia’s FAL Food and Beverages, which makes the Coco Joy, Juiced Up and Aqua Hero beverages, on Monday said it would set up its first Indian factory within three years, which will serve several countries.

“We’ll start with Coco Joy coconut water and the entire Coco Joy range will be introduced in India over next four to six months. Eventually, we’ll bring our entire portfolio of brands,” Tim Xenos, chief executive, FAL Food and Beverages, said in a phone interview.

The products will be priced upmarket, but below the premium segment.

The firm is likely to spend $9-10 million in India to set up its distribution and retail presence, said Xenos. “The manufacturing facility will require more than $5 million,” said Xenos. The company hopes to have an initial production capacity of 12,000-15,000 units per hour and may double it over a period of time. It will require about five acres for a production unit.

“India will be the hub for manufacturing. Besides meeting the captive demand, we would export to the US, Australia, neighbouring countries like Bangladesh and Sri Lanka and nations that have free trade agreements with India,” Xenos said.

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At present, FAL has three manufacturing units across Malaysia and Saudi Arabia. The maker of low-calorie, low-sugar and fat-free food and beverages sells in Australia, New Zealand, Malaysia, the US and China. FAL Food and Beverages is a part of FAL Holdings, which has a presence in 17 countries across West Asia, Australia, the US, Europe and China.

“India is the most important market for us. Though we are entering India today, we see revenue from India reaching $100 million in a few years,” said Xenos.

The firm will operate through a fully-owned subsidiary and set up its own distribution network. FAL Food and Beverages hopes to close the next fiscal year with $100 million sales, from $35 million at present.

The nutraceuticals market, including nutritional food and beverages, in India is estimated at around $2.8 billion at present and is projected to cross $6.1 billion by 2020, according to a study released on Monday, jointly conducted by the Associated Chambers of Commerce and Industry of India and market research firm RNCOS.

FAL will start with modern trade retail and grocers across metro markets in India, besides online marketplaces as an alternative route, said FAL’s India business head Jasmeet Khanna.

For brand promotion, FAL will leverage its global co-branding alliance with Disney in India as well. Former cricketer Vivian Richards endorses Coco Joy. FAL’s other global co-branding alliances include Manchester City Football Club, Melbourne City Football Club and New York City Football Club. “Once we set up our presence, we’ll look at developing branding properties in India as well,” said Khanna.

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