**Havmor Ice Cream Expands Production Amid Rising Costs**
Havmor Ice Cream is experiencing a surge in demand this summer, driven by its recent expansions in manufacturing and distribution. The company has invested ₹100 crore in a new plant in Pune, which can accommodate up to 16 production lines, and has also allocated ₹50 crore to enhance its Anand facility by adding five additional lines. Despite the strong seasonal demand, rising input costs, particularly for chocolate and dairy products, are putting pressure on profit margins.
Komal Anand, the managing director of Havmor, highlighted the challenges posed by inflation in key commodities. “Cocoa prices have nearly tripled compared to last year, and prices for white butter and skimmed milk powder are also on the rise,” he noted. This situation is particularly challenging for Havmor, which has a product portfolio heavily reliant on chocolate.
The company operates three manufacturing facilities across India, located in Anand, Vadsar in Gujarat, and Pune. Anand mentioned that Havmor has limited pricing power in the competitive ice cream market, stating, “We’ve only passed on a small portion of the inflation to consumers. The ice cream segment is highly price-sensitive, and we face competition from both cooperatives and multinational corporations with greater scale and backward integration.”
In response to market demands, Havmor recently launched ‘Krunch,’ a premium stick ice cream that utilizes advanced Korean technology to create a unique layering of jam, vanilla, chocolate, and cookies. “This is the first of its kind in India, made possible through technology transfer from Lotte Korea,” Anand explained, emphasizing that local competitors would find it difficult to replicate this innovation. Priced at ₹60, Krunch offers a premium experience without being excessively costly, especially when compared to similar products from global competitors that can reach nearly ₹100.
Havmor is committed to ongoing growth, with plans to invest ₹40–50 crore annually in capital expenditures and supply chain improvements. The company aims to expand its distribution network to nearly 90,000 outlets by the end of 2025, up from approximately 60,000 two years ago, with a particular focus on increasing its presence in southern markets.
As Havmor continues to innovate and expand, it faces the dual challenge of meeting consumer demand while navigating the complexities of rising production costs.
**FAQ**
**What challenges is Havmor Ice Cream facing in the current market?**
Havmor is grappling with rising input costs, particularly for chocolate and dairy, which are squeezing profit margins despite strong seasonal demand for its products.
