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Indian Nutraceuticals Industry

Market Size
₹ 23,896 crore in 2019 (Estimated)

Annual Growth Rate
Growing at 16% CAGR annually since 2015

Landscape
Industry is characterized by a low barrier to entry and competitive pricing

Growth Drivers
Growth in discretionary income and spending. Evolving lifestyles and dietary patterns. Increasing concerns about nutrition, awareness and access to information

Indian Nutraceuticals Industry

Indian Nutraceutical Industry

Nutraceuticals (also called health supplements) are specially processed or formulated foods designed to satisfy particular dietary requirements and/or provide medicinal or health benefits. They generally contain extracts from plant & animal sources, minerals, vitamins and dietary substances either discretely or in various combinations designed to meet a specific health requirement or augment nutritional intake.

The global nutraceutical industry was valued at USD 169.32 bn (₹ 1,100.58 thousand crore) in 2015 and was growing at a CAGR of 6.5%  in 2015. It is expected to grow at a CAGR of 7.3% from 2015 to 2021.

Currently, the United States, Europe and Japan account for 93% of the total global nutraceutical market and the market seems to have attained maturity in all the three regions. Therefore, the nutraceutical industries across the world are now turning their attention to emerging markets like India and China. The Indian nutraceutical market is expected to grow at a much higher CAGR of 16% over the next five years to reach ₹ 26,764 crore by 2020 according to the Drug Marketing and Manufacturing Association (DMMA) This would in effect be twice the current market size driven by strong demand for dietary supplements from the upper and middle class.

In 2014, the global nutraceuticals market was dominated by North America followed by APAC and Europe. However, the market in North America and Europe is saturated and the APAC region is poised to witness significant growth driven by an increasingly health conscious population and rising disposable incomes.

In India, FSSAI regulates the health supplements and nutraceuticals through Food and Safety Standards Act, 2006 and the regulations framed thereunder.

 

Segmentation of Health Supplements and Nutraceuticals

A. Fortified/Functional Food in India

  • • With 11% current value growth in this segment from 2015, the market size of this segment is approximately ₹ 13,260 crore in 2016
  • • Probiotic drinking yogurt sees strongest current value growth of 28% in 2016
  • • Cargill is the leader in this segment based on market share
  •  

Company Name

Key Products

Kellogg

Kellogg's Cornflakes, Oats

Abbot

PediaSure

Agro Tech Foods

Sundrop

Britannia Industries

Cheese, Nutrichoice biscuits, Tiger Glucose Biscuits

Cargill

Gemini, Sweekar

GlaxoSmithKline Consumer Healthcare

Horlicks

Nestlé

ActiPlus Dahi, CEREGROW, MILO, Baby & Me

Ruchi Soya Industries

Nutrela

ITC

Sunfeast

National Dairy Development Board

Dhara

Gujarat Co-operative Milk Marketing Federation

Amul

Mother Dairy Fruit & Vegetable

Nutrifit

Yakult

Probiotics

Pepsi Co

Quaker Oats

Patanjali

Choco Flakes, Corn Flakes, Oats, PowerVita

Heinz

Glucon C

Baggrys

Cornflakes, Oats

Mondelez

Bournvita Malt Drink

Mead Johnson

Enfagrow

General Mills

Natures Valley Granola Bars

Zydus Wellness

Glucon D, Complan, Actilife, Nutralite

 

  1. B. Functional Beverages in India
  2. • Functional drinks market grew by 15.6% in 2014.  By 2019, the functional drinks market is expected to have a value of ₹ 2,811.9 crore (an increase of 69% since 2014)
  • • Energy drinks is the largest segment accounting for 63% of the total market value
  • • Red Bull is the leading player with a 83% market share in energy drinks

• PepsiCo with Gatorade is the leading player in sports drinks category with 83% market share in 2016

 

Company Name

Key Products

Red Bull

Red Bull Energy Drink, Red Bull Sugar Free

Coco-Cola

Minute Maid Juices

PepsiCo

Gatorade, Fruit Juices including the Tropicana brand

Goldwin Healthcare

Cloud 9 Energy Drink

Hector Beverages

Paperboat

GlaxoSmithKline

Lucozade

Patanjali

Aloevera Fibre Juice

Dabur

Fruit Juices and Real and Real Activ Brand

 

  1. C. Dietary Supplements in India
  2. • Vitamins and dietary supplements registered a growth of 13% in 2016
  • • Fish Oils/ Omega Fatty Acids recorded fastest growth of 16% in 2016
  • • Amway is the leader in this segment based on market share
  •  

Company Name

Key Products

Amway

Nutrilite range of products

Aventis Pharma

Seacod Capsules

Dabur

Dabur Glucose – D

Danone

Protinex

Novartis

Calcium Sandoz

Herbalife International

Herbal Life Protein Powder

Himalaya Drug Company

Himalaya Pure Herbs

Types of Nutraceuticals

Nutraceutical Products

Dietary Fibre

Dietary fibres lower risk of developing coronary heart disease, strokes, hypertension, diabetes, obesity and certain gastrointestinal disorders

Probiotics

Probiotics help improve intestinal microbial balance. There is also evidence of it decreasing the risk of developing allergy, asthma, cancer and several other infections of the ear & urinary tract

Prebiotics

The health benefits of the prebiotics include improved lactose tolerance, antitumor properties, neutralization of toxins, and stimulation of intestinal immune system, reduction of constipation, blood lipids and blood cholesterol levels

Polyunsaturated Fatty Acids (PUFAs)

Studies suggest that PUFAs have three major effects on the cardiovascular system as it is serves to be anti-arrhythmic (preventing or alleviating irregularities in the force or rhythm of the heart), hypolipidemic (promoting the reduction of lipid concentrations in the serum) and antithrombotic (decreased arteriosclerosis)

Antioxidant Vitamins

Antioxidant vitamins act both singly as well as synergistically for the prevention of oxidative reactions leading to several degenerative diseases including cancer, cardiovascular diseases, cataracts etc.

Polyphenols

Polyphenols possess antioxidant, anti-inflammatory, anti-microbial, cardioprotective activities and play a role in the prevention of neurodegenerative diseases and diabetes mellitus. There is also evidence that they have anti-carcinogenic and anti-atherogenic implications

Spices

Dietary spices in their minute quantities has an immense influence on the human health by their antioxidative, chemopreventive, antimutagenic, anti-inflammatory, immune modulatory effects on cells and a wide range of other beneficial effects on human health

Top Players 

Company Name

General Mills Inc

The Nature’s Bounty Co. (NBTY)

Amway Enterprises

Herbalife International, Inc

Royal DSM NV

Pepsi Co

Groupe Danone

Bayer AG

Abbott Laboratories

Chobani LLC

Demand Drivers

1. Malnutrition status in India and micro-nutrient deficiency

  1. 2. Affordability: Increasing costs of hospitalization are driving consumers towards health supplements and nutraceuticals
  2. 3. Affluence of working population with changing lifestyles and dietary patterns and increase in disposable income
  3. 4. Awareness: Increasing concern about nutrition, awareness and access to information have led to an increase in use of health supplements and nutraceuticals

  4. Supply Drivers

With India transforming into a global manufacturing hub, there is strong impetus for nutraceutical product manufacturers to set up production facilities in India

  • • Strong economic growth with encouraging macroeconomic indicators
  • • Strategic location with access to all major shipping routes
  • • Low cost of labour
  • • Large pool of technical and skilled labour
  • • Easy availability of ingredients
  • • Strong distribution networks coupled with accessibility of products through e-commerce
  •  
  • Notes

Exchange Rate: 1 USD = ₹ 65  = 0.75 GBP = 0.85 Euro

Disclaimer: This information has been collected through secondary research and SMERGERS is not responsible for any errors in the same

Figures

[a] https://www.ey.com/Publication/vwLUAssets/ey-health-supplements-and-nutraceuticals/$File/ey-health-supplements-and-nutraceuticals.pdf

References

[1] https://www.ey.com/Publication/vwLUAssets/ey-health-supplements-and-nutraceuticals/$File/ey-health-supplements-and-nutraceuticals.pdf

[2] http://www.nuffoodsspectrum.in/inner_view_single_details.php?page=1&content_type=&vrtcl_panel_nm=&ele_id=NOR_588b37ba948df4.78777381

[3]  https://timesofindia.indiatimes.com/city/ahmedabad/nutraceuticals-market-in-india-to-double-by-2020/articleshow/57103090.cms

[4]  https://timesofindia.indiatimes.com/city/ahmedabad/nutraceuticals-market-in-india-to-double-by-2020/articleshow/57103090.cms