FMCG shares upbeat as HUL, ITC, Britannia, others get nod under food processing PLI scheme

PLI scheme for food processing

Most components of the Nifty FMCG index were trading in the green on December 7, a day after the government said it had approved applications from 60 companies under the production-linked incentive scheme (PLI) for food processing.

The food processing ministry said applications of investment proposals by packaged food companies such as Amul, ITC, HUL, Britannia Industries, Parle Agro, Tata Consumer Products and Nestle India had been approved.

While ITC was trading 0.6 percent higher at Rs 219.10 on the BSE, HUL was up 0.8 percent at Rs 2,326.55 and Britannia Industries was up 1 percent at Rs 3,528.55.

In March 2021, the Cabinet approved a PLI scheme for the food-processing sector, with an outlay of Rs 10,900 crore. The scheme would help create 2.5 lakh jobs, boost exports and ensure availability of a wider range of value-added products for consumers, the government had said.

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The ministry had invited expressions of interest (EoI) and proposals for availing these incentives with the last date for submission of proposals at June 24.

"In response to the EoI, the ministry had received a total of 91 applications under Category 1. The approval committee under the chairmanship of the minister, FPI (food-processing industries) has accorded approval to 60 applicants under Category 1," it said in a statement.

According to the list, 12 applications have been approved in ready-to-eat and ready-to-cook segment, including that of Britannia Industries, Haldiram Snacks, Gujarat Co-Operative Milk Marketing Federation (Amul), Parle Biscuits, ITC, Balaji Wafers, Hindustan Unilever, Prataap Snacks and others.

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In the fruits and vegetables segment, 18 applications were approved of companies including Parle Agro, Tasty Bite Eatables, ITC, Hindustan Unilever, Varun Beverages, Nestle India, Dabur India, Tata Consumer Products, and others.

In the marine food category, 11 proposals have been approved including those of Falcon Marine Exports, Avanti Frozen Foods and ITC.

Four proposals have been approved in the mozzarella cheese segment of Parag Milk Foods, Amul, Sunfresh Agro Industries, and Indapur Dairy and Milk Products.