Dietary supplements biz rides health wave

With a majority of people slowly turning health conscious and looking at dietary supplements, coupled with many international companies offering health supplements at an affordable price point, the health supplements and nutraceuticals market is set to grow rapidly.

Though the market in India is still at a nascent stage, according to ResearchAndMarkets, it was valued at Rs 26,000 crore in 2017 and is expected to reach a value of Rs 80,800 crore by 2023, expanding at a CAGR of 17%.

Rising awareness of health issues and alternatives, the affluence of the working population with changing lifestyles and dietary patterns and increase in disposable income, all these drive consumers towards health supplements and nutraceuticals. Also, malnutrition status in India and micro-nutrient deficiency are key drivers for the growth of this industry, point out analysts.

“MNCs like GSK, HUL, Amway, Nestle, Danone, Kellogg’s and Pepsico have their strong presence in the Indian nutraceutical and health supplement market. Indian players like ITC, Dabur, Himalaya, Patanjali,
and Baidyanath are also striving to gain
market share in the industry,” says Paras Bothra, President-Equity Research, Ashika Capital.

One of the largest direct selling companies Amway recently strengthened its nutrition and wellness product portfolio with the launch of Nutrilite Traditional Herbs Range. The new range is targeted to yield a revenue of Rs 125 crore by 2020.

“Nutrition is a fundamental need. Over the past few years, radical changes in lifestyle and eating habits of people have led to rapidly increasing conditions of malnutrition, micronutrient deficiencies, and over-nutrition. Considering the realities of irregular eating habits and food adulteration which affects the nutritional intake among Indians, we believe nutritional supplements along with regular diets can go a long way in improving the health of our nation,” says Sundip Shah, Chief Marketing Officer, Amway India.

Amway’s Nutrilite, which has been there since 1934, is now gaining popularity in India and is said to be one of the leading vitamins and dietary supplements (VDS) brands. “The health and wellness brand contribute more than 50% of Amway India’s revenue currently,” says Shah.

The company, which witnessed global sales of $8.6 billion last year, invested over Rs 600 crore in a manufacturing facility in Nilakottai in the Dindigul district of Tamil Nadu in 2015, as part of its Rs 1,000 crore investment in India.

Given the market potential, the company plans to invest Rs 100 crore in boosting R&D, manufacturing and digital initiatives in India over the next 2-3 years, which is inclusive of Rs 70 crore alone to strengthen R&D capabilities.

While protein dietary supplements market size is estimated at Rs 1,400 crore in India, Amway Nutrilite enjoyed 25% market share in 2017.

Double-digit growth

Health supplements and nutraceuticals- Emerging high growth sector in India, a study assessing the current health supplements and nutraceuticals market in India published for the Ministry of Food Processing Industries (MoFPI) by Ernst & Young LLP (EY) and Confederation of Indian Industry (CII), points out that all three segments of the Indian health supplements and nutraceuticals market- fortified/ functional packaged food, dietary supplements and functional beverages are registering a double-digit growth.

The report adds that four key demand drivers in India that have resulted in the need for health supplement and nutraceuticals are­ ­malnutrition status in India and micro-nutrient deficiency, affordability, affluence of working population with changing lifestyles and dietary patterns and increase in disposable income , and awareness.

Awareness of health supplements and nutraceuticals products are also increasing due to an increase in the number of nutritional care professionals or service providers i.e. dietician and nutritionist.

The nutritional care segment is growing at a CAGR of 12% and has a 27% market share in the wellness industry consisting of beauty care, fitness centres, alternate therapy, and rejuvenation, the report added.

Sizeable market

PS Narayanan, Head of Product Development for QNet, India says that over the past few years, they have seen a substantial growth in the health supplements category.

“The consumers are moving towards a healthy lifestyle as a way of living. This is an ongoing trend for the past five to six years. It is also seen that Indians are diverted towards sugar-free, gluten-free, fat-free supplements. Preference for nutritional foods will boost the nutraceutical market across the globe.”

Talking about the West and APAC region, he says a growing number of health-conscious people in North America will make it continue as the leader on the geographical forefront. APAC is expected to hold the second position in terms of market share. It is expected to witness significant growth in the market due to increasing demand in countries such as China and India.

The company localises international products in India, and this includes DiabaHealth, BoneHealth, SkinHealth, Monofloral Honey and various herbal tea blends.

Global nutrition company Herbalife in 2017 launched its first research and development (R&D) centre in India in Bengaluru in partnership with Biocon’s research services arm Syngene International Ltd.

Ajay Khanna, Vice President, and Country Head, Herbalife Nutrition says, “We are also trying to contextualise our products to address the needs of the market. In Q2, we launched the Formula 1 Healthy Meal in Kulfi flavour and this is already one of the top sellers in India.”

Regulatory framework

Though there is a growing awareness and large players, the key challenges of the market are the lack of a clear regulatory framework for the dietary supplements market in India.

“Around 60% of the dietary supplements sold across India are fake, counterfeit, unregistered and unapproved, in addition to being extremely difficult to identify. In India, protein supplements are priced high, making it quite expensive for consumption on a regular basis by the lower middle class and rural population of the country,” points out a report on Dietary Supplements Market in India 2018-2023 by ResearchAndMarkets.

However, analysts point out that there is no denial of tremendous opportunities that are existing at present in the country.

DH News Service