Bengaluru: Biscuits and confectionery firm Parle Products Pvt. Ltd plans to launch three new variants under its traditional Indian snacks category in the next financial year even as it throws its might behind consolidating market share in the premium biscuits segment.

Parle plans to increase contribution from the snacks and confectionery segments to 20% from 15% at present by the end of the next fiscal, said Parle’s category heads Krishna Rao and Mayank Shah.

The consumer goods firm currently sells four different types of snacks: potato chips under its Parle’s Wafers brand, a twisty snack called Full Toss, nacho chips under the Mexitos name, and traditional Indian namkeens called Parle Namkeen. It will rebrand to Namkeen as Chatkeens over the next three or four months and is launching three new variants in the category: cornflakes mixture, dalmoth and Punjabi Tadka between March and April.

Snacks make up just 3% of Parle’s overall business, which is dominated by biscuits— including Parle G and Krackjack brands—that account for about 85% of total revenue. The remaining 12% of the business comes from confectionery brands like Eclairs, Melody, Mango Bite, Kismi and Poppins.

Still, snacks and confectionery are the fastest growing categories, according to Krishna Rao who looks after both portfolios. He is aiming at increasing contribution from both to a total of 20% in the next financial year and is targeting revenue of Rs1,000 crore from snacks by 2020.

“The rebranding exercise is on the packaging front. Apart from that, we haven’t really done as much of an investment," Rao said.

“Snacking is definitely growing. If you look at the US, Europe, Japan or even China, the amount of snacking options available to people in those markets is huge. Indian firms have been very timid. So anybody who is bringing in more variety, more categories into it, I think they are doing the right thing," said Harminder Sahni, founder and managing director at consulting firm Wazir Advisors.

Last year, Parle launched five new confectionery brands priced at Re1—Spicy Kaccha Mango Bite, Juicy Mango Bite, Cafechino, Cremax Eclairs and Melody Chocomel Eclairs. Going forward too, the focus is on launching new confectionery priced at Re1 rather than the older 50 paise as earlier.

In biscuits, Parle has strong presence in the mass and popular price segments, including biscuits that cost less than Rs100 per kg and between Rs100 and Rs200 respectively, according to Shah, category head for biscuits and chocolate. The focus now is to increase market share in the premium segment, or biscuits priced above Rs200 per kg.

Rivals in the premium end of the market include Britannia Industries Ltd (NutriChoice), ITC Ltd (Dark Fantasy) and Mondelez India Foods Pvt. Ltd (Oreo).

“You launch, you build, you consolidate and then you look at a new launch; that’s how the cycle works. You consolidate a new launch over a period of two years or so—we missed on that opportunity because of demonetization last year. So, we are not looking at any launches for the next six months at least," said Shah.

Parle launched its Hide & Seek Black Bourbon, Hide & Seek Choco Rolls and Milano Centre Filled premium ranges only a couple of years ago.

In biscuits, Parle earns about 40-45% from its mass offerings, 35-40% from popular brands and about 10-15% from premium biscuits. It expects growth to be driven by popular and premium going ahead.

“Premium biscuits are a very competitive market. I think (Parle) may be right in holding the horses there. They may want to focus on creating large volumes and I would say that’s the way to look at it because the premium end is very competitive and it’s still fairly small today," said Sahni of Wazir Advisors.

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