India is a global hub for all that is good and great in food ingredients for while Health ingredients stand to attain large market shares if touted right they also face stiff challenges. For instance while fortified foods are an emerging segment in India and will greatly benefit from clarity in regulation and consumer acceptance, the onus is on the government to expedite development through regulation. Also large F&B firms need to invest in marketing dollars to improver consumer awareness. Additionally expansion into new end use segments compatible with the Indian palette can promote increased adoption.

1. Indian Health Ingredients Market: Survival of the fittest! Abhik Mukherjee, Research Analyst Chemicals, Materials & Foods Frost & Sullivan’s Growth Consulting can assist with your growth strategies

2. Today’s Presenters Anish Charles, Assistant Manager, Corporate Communications – Chemicals, Materials and Food and Healthcare Frost & Sullivan Abhik Mukherjee , Research Analyst, Chemicals, Materials & Foods Frost & Sullivan

6. Market Challenges Industry Challenges 1 Lack of legislation stunts growth 1 Low Consumer awareness hampers growth 2 1 Price sensitivity of consumers inhibits product innovation 3

7. Market Drivers and Restraints New end use segments drives usage Nutritional initiatives by the Indian government Market Drivers Market Restraints Rise in disposable income promotes switch to healthier lifestyles High barriers to entry Lack of product innovation Scientific studies on Indian population

8. Key Functional Food Industry Trends Food as medicine Industry Trends Micronutrient Deficiencies Child Nutrition Food as medicine Obesity & Lifestyle Diseases

9. Macro Market Forces Economic: GDP growth, Disposable Income and other factors that influence the economy Legal: Consumer law, antitrust law, patents and other laws that effect the business landscape Technology: R&D capabilities, technology change and other technology aspects that influence business development Demographic: Population growth, age distribution and related factors that can create market trends Social: Cultural factors, attitudes and behavior that can drive new businesses and product development Strong Weak Health Ingredients Vitamins & Minerals Omega 3 Probiotics Prebiotics Economic Legal Technology Demographic Social

10. Total Indian Health Ingredients Market Forecast The Indian Health Ingredients market had a total volume of 770.6 MT in 2009, with potential volumes of 1452.2 MT in 2016. The market is likely to grow at a CAGR of 9.5 percent from 2007 to 2016. Indian Health ingredients Market : Volume Forecasts (India), 2007-2016 CAGR 9.5 %

11. Health Ingredients: Now and Beyond Market Maturity low High Growth Potential High Omega 3 Fatty Acids Probiotics Prebiotics Vitamins & Minerals The Indian health ingredients market is at an early growth stage with regards to both the demand and supply ends. This is mainly attributed to lack of consumer awareness and low product innovation by FMCG firms. Vitamins & Minerals is the only segment which is in the middle of the growth curve. The trend of prebiotic as a sugar substitute is expected to stimulate strong growth The market for probiotics is expected to experience strong growth medium term aided by the culture of dairy product consumption Omega 3 fatty acid demand will be mainly driven by the malted health beverages sector for the forecasted period

12. Ingredient Manufacturers

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18. For Additional Information Anish Charles Corporate Communications Chemicals, Materials and Food/ Healthcare Practice (022) 6607 2019 [email_address] Natasha D’Costa Senior Research Analyst Chemicals, Materials and Food Practice (044) 3914 4700 [email_address] Hema Thakur Senior Consultant Chemicals, Materials and Food Practice (022) 6607 2026 [email_address]