Lotte Wellfood, the South Korean confectionery giant, has announced a strategic merger between its Indian subsidiaries, Lotte India and Havmor Ice Cream. This merger, part of Lotte’s ambitious "One India" initiative, aims to enhance brand presence and secure robust growth in the Indian confectionery and ice cream markets.
As part of the merger, Lotte will continue to honour Havmor's heritage while expanding it alongside Lotte to solidify its position as a leading ice cream brand in India. This strategic move is set to drive significant growth, with the integrated entity targeting annual sales of 1 trillion KRW (approximately INR 6000 cr).
However the expansion will require substantial investment. In line with this initiative, Lotte Wellfood will invest INR 400 cr to establish a new ice cream production facility in Pune, Maharashtra This new plant will broaden the company's regional reach, enhancing coverage from the west to the south-central regions of India.
Chang-Yeop Lee, CEO of Lotte Wellfood, commented on the merger, saying, "The launch of ONE INDIA represents a pivotal moment for us. Our goal is to cement Lotte’s brand presence and capture growth momentum in the Indian market. With our long-term vision focused on significant investments, the merger will enhance management efficiency and maximize synergies. We are committed to strengthening our local brand, expanding our product portfolio, and integrating logistics and production. This merger will enable us to offer a diverse range of products, catering to varied consumer preferences and needs."
The merger, approved by the boards of Lotte India and Havmor on July 29, 2024, will see Havmor Ice Cream integrate with Lotte India, with both brands retaining their individual identities for operational continuity. The merger is expected to be finalized in the second half of this year, with the new integrated entity launching early next year.
Further aligning with its localisation strategy, Lotte India has previously invested over INR 210 cr to establish its first overseas production base for Lotte Pepero at its Haryana factory, with operations set to begin in the latter half of next year. Following the success of Lotte Chocopie, the company also plans to develop localised versions of Pepero tailored to local tastes and climate conditions.
Since entering the Indian market in 2004 through the acquisition of Parrys, which was rebranded as Lotte India, and acquiring Havmor in 2017, Lotte has seen significant growth. The unified entity aims to build a strong financial foundation and achieve ambitious sales targets through aggressive investments in the Indian market.
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