Lotte’s Chennai Factory Expansion Boosts Choco Pie Output; Rs 185 cr Investment 2023
Lotte, the South Korean conglomerate renowned for its confectionery products, has recently announced a significant expansion of its factory near Chennai.
This move underscores the company’s commitment to meeting the surging demand for its popular snack, Choco Pie, in the Indian market. With an investment of Rs 185 crore, the expansion is anticipated to not only increase Choco Pie production but also solidify Lotte’s presence in India.
Ever since its introduction to the Indian market, Choco Pie has become a household name and a favoured snack among both children and adults.
Its unique combination of soft cake, marshmallow filling, and a chocolate outer layer has captivated the taste buds of millions across the country. The snack’s success in India mirrors its popularity in other parts of the world.
One of the key participants in the nation’s confectionery market, Lotte India, a subsidiary of the Korean multinational Lotte Corporation, has expanded its facility at Nemam, outside of Chennai.
To enhance manufacturing of its Lotte Choco Pie goods, the business has invested ‘185 crore in an 85,562 square foot extension of the confectionery facility.
The investment would significantly bolster Lotte India’s dominance in the Indian confectionery business and offer 200 new employment for residents of Nemam and the surrounding area.
With yearly sales rising from Rs 168 crore in 2007–2008 to $496 crore in 2021–2022, the firm has had outstanding development, exhibiting an excellent year-over-year growth rate of over 21%. The firm generated 657 crore in yearly revenue during the fiscal year 2022–2023.
“This expansion builds on Lotte India’s rich history in India and comes at an exciting time for our overall investment and growth in the country,” said Milan Wahi, MD of Lotte India. Our factory’s facility area has significantly increased, going from 18% to 32% of its original size, making it one of the largest factories in India with a total size of 5,16,398 square feet.
Since opening in 2010, the Nemam facility has won praise for upholding the highest safety and hygienic requirements. The plant has 99% retention rate and has maintained “zero accident hours” for the past ten years, according to a statement from the firm.
The Chennai facility, strategically located for its proximity to key markets and logistic routes, will see an expansion in terms of both size and capacity. The precise figures regarding the added square footage or production capabilities have not been detailed, but given the size of the investment, a substantial increase can be expected.
With the expansion, the factory is likely to offer additional employment opportunities for the local populace. This would mean not only direct jobs in the factory but also indirect jobs in logistics, packaging, and distribution.
Lotte’s approach to production has often incorporated the latest technology for efficient and sustainable operations. The Chennai expansion is anticipated to include state-of-the-art machinery and sustainable practices that reduce the factory’s carbon footprint and promote eco-friendly production.
India, with its vast and diverse consumer base, presents an attractive market for global corporations. For Lotte, the Choco Pie success story is just one example of the potential the Indian market holds. The Rs 185 crore investment is not just about increasing production; it’s a strategic move to deepen roots in a market that offers vast growth opportunities.
Given the increasing demand, Lotte might look into diversifying its product range in India, introducing other globally successful products, and tailoring new ones to cater to Indian tastes. The expanded factory could potentially serve as a hub for exporting to other nearby markets in the future, given its strategic location and enhanced capabilities.
Lotte’s decision to invest Rs 185 crore in expanding its Chennai factory is a testament to the potential they see in the Indian market. As Choco Pie continues to win hearts across the country, this move signifies Lotte’s commitment to ensuring its availability and possibly introducing the Indian consumer base to a wider range of products. It’s an exciting phase for both the company and its loyal customers in the region.
