?Paper Boat expects to grow to Rs 100 crore by 2018
?Paper Boat expects to grow to Rs 100 crore by 2018

Neeraj Kakkar and Neeraj Biyani, the co-founders of Hector Beverages Pvt. Ltd, the company that makes traditional drinks under the Paper Boat brand, expect to grow to Rs100 crore in 2017.

Currently, the company has a total of nine year-round products including flavours such as jamun kala khatta, aamras, aam panna, anar and chilli guava. The seasonal products introduced by the company include Thandai, Serbet-e-khaas, Rose Tamarind and Panakam, among others.

Arvind Singhal, Chairman, Retail Consultancy Technopak Advisors Pvt. Ltd., said, "The Company has been innovative in terms of product, packaging and marketing to create the consumer wow factor. It can certainly take credit for that."

Kannan Sitaram, Indian Equity Partners, said, "Paper Boat founders had solid consumer insight that traditional beverages will work, especially when they come without preservatives. There is strong consumer support because of the authenticity of the products."

Kakkar added, "There is a shift from commodities to brand play. It happened in many countries and it is happening in India right now."

According to filings with the Registrar of Companies, for fiscal year 2014 Hector Beverages earned revenue of Rs15.9 crore. For FY15, it was closer to Rs25 crore (estimated post-adjustments). The numbers for the year to March 2016 are not available. The company expects to grow to Rs100 crore this year.

Having ramped up its production capacity significantly, Paper Boat is now concentrating on improving distribution.

Biyani said, "We can double our numbers everywhere if we could focus on and improve our distribution."

Currently, Paper Boat is available in 70,000-100,000 outlets compared to, say, the leading soft drinks brands which are present in more than 1.2 million outlets. For now, the brand enjoys a significant presence in metro cities such as Delhi, Mumbai, Bengaluru, Hyderabad, Pune and Chennai.

Kakkar added, "Our current challenge is how to go deeper with a product which has a shelf life of four-six months."

To increase its reach, Hector Beverages has tied up with Indo Nissin Foods Pvt. Ltd, the Japanese company which makes Top Ramen noodles. It hopes to piggyback on Indo Nissin's distribution network to expand into the tier II markets and some rural pockets.

Kakkar expects 60 percent of Paper Boat's business to come from Indo Nissin's distribution network.

 
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