India Pan Masala Market Size and Share Outlook - Forecast Trends and Growth Analysis Report (2024-2032)

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India Pan Masala Industry Overview

Pan masala is a mouth freshener, which is made using herbs such as cardamom, cloves, catechu, areca, and other flavouring agents. Pan Masala is a generic term for modern areca nut products that fall under the category of smokeless tobacco commodities. It is generally consumed to remove bad odour or to get a refreshing taste in the mouth. Pan masalas come in a wide variety of flavours and are packed in attractive sachets and tin cans.

The India pan masala market is currently being driven by the growing inclination of large-scale consumers to switch from tobacco products to healthier pan-masala alternatives. The increasing disposable incomes of both urban and rural households are driving the demand for pan masala further among consumers across social backgrounds. Pan masalas are increasingly gaining prominence among consumers in the rural as well as urban sectors.

India Pan Masala Market Growth

The increasing investments by the key market players in product advertising and marketing are driving the growth of the India pan masala market. In the forecast period, the launch of new pan masala flavours is anticipated to support the market growth. For instance, Rajnigandha, a leading manufacturer of pan masala, offers exotic flavours of pan masala including cloves and saffron.  In addition, the rising expenditure by the manufacturers to provide quality packaging to facilitate longer shelf life and ensure prolonged retention of flavour and fragrance is expected to prove beneficial for the market growth in the coming years.

The market is evolving with changing consumer preferences towards healthier, tobacco-free, and premium products. The shift towards flavoured, packaged, and natural ingredients reflects growing health consciousness and the demand for convenience.

Key Trends and Developments

India Pan Masala Market Trends

With growing health awareness, consumers are increasingly favouring pan masala products that use natural, organic ingredients and are free from synthetic additives. This shift in India pan masala market is prompting manufacturers to offer pan masala with herbal or ayurvedic components like mint, cloves, cardamom, and saffron instead of artificial chemicals, making the product more appealing to health-conscious individuals.

The digital transformation in India is contributing to the growth of online sales of pan masala. E-commerce platforms are becoming an important distribution channel for niche and premium pan masala brands. The convenience of online shopping is attracting younger consumers who prefer to buy pan masala from the comfort of their homes, leading to increased sales through digital platforms.

India Pan Masala Market Restraints

Under the Finance Bill 2024 in February, the GST law of the country now states that pan masala, gutkha and similar tobacco products providers would have to pay a Rs 100,000 fine if they don’t register their packing machinery with GST authorities effective from April 1, 2024. This is expected to pose a challenge for manufacturers who fail to do so due to some difficulties.

As per the India pan masala market dynamics and trends, the Bombay High Court in Maharashtra refused to stay the decision of the Food and Drug Administration (FDA) which prohibits the production, storage, distribution, and sale of tobacco and areca nuts or pan masala in the state, to uphold public health. This decision severely impacted the sales of pan masala in Central and Western regions of India.

The Delhi High Court has further upheld the Food Safety and Standards Authority of India (FSSAI) regulation, under which the warning on the pan masala packet should be around 50% of the entire front-of-pack of the label so that it is clearly visible to the customers. This can make consumers more aware of the health risks associated with pan masala, hindering the market growth.

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India Pan Masala Industry Segmentation

India Pan Masala Market Share

By Type Insights

Pan masala with tobacco has maintained a majority share in the market over the years owing to its widespread prevalence in semi-urban and rural areas. The addictive nature of nicotine also contributes to the India pan masala industry revenue. In recent years, flavoured and plain pan masala have been gaining widespread growth as they offer healthy and flavoured alternatives for health-conscious consumers.

By Price Range Insights

The market is currently being driven by the growing consumer demand for premium pan masalas, owing to the improved living standards of people. The easy availability of pan masalas in convenience stores and supermarkets is also supporting the market growth. As per the India pan masala industry analysis, the growing investments by the market players in the development of innovative pan masala flavours such as chocolate, gulkand, and silver-coated betel nuts are anticipated to bolster the market growth in the forecast period.

By Packaging Insights

Pouch packaging is expected to witness a CAGR of 4.3% in the forecast period as it is lightweight in nature and easy to carry. It is also more cost-effective for manufacturers as well as consumers compared to other packaging types, boosting the growth of the India pan masala industry. This type of packaging is also moisture-proof and air-tight and can preserve the taste and quality of the product.

By Distribution Channel Insights

Online channel is expected to witness a CAGR of 4.1% between 2024 to 2032 due to increased penetration of the internet as well as rising availability of smartphones, which have made it easier to access pan masala products online and boosted the India pan masala market opportunities. Rural India had 442 million active internet users in 2023 and the number is only expected to rise, which offers significant marketing opportunities for pan masala providers.

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India Pan Masala Market Regional Insights

North India Pan Masala Market Drivers

North India has emerged as a significant region in the pan masala market share in India as it is expected to have a CAGR of 4.9% in the forecast period. Tobacco consumption is prevalent in states such as Himachal Pradesh, Uttarakhand, Haryana, and Jammu Kashmir, among others, especially among men.

Moreover, pan masala is stated to enhance the alertness and satiation of a person which is also appealing to the consumers in the region. The burgeoning popularity of pouch pan masala in local pan shops also aids the market growth.

Competitive Landscape

The report gives a detailed analysis of the following key players in the market, covering their competitive landscape, capacity, and latest developments like mergers, acquisitions, and investments, expansions of capacity, and plant turnarounds. Several major players in India pan masala market are readily diversifying their product portfolio to cater to different types of customers. For instance, some companies are launching flavoured pan masala while others are offering sugar-free pans. Meanwhile, some companies have been relying on celebrity endorsements to improve their market reach.

DS Group

Dharampal Satyapal Group was established in 1929 and is famous in India for its pan-masala brand, Rajnigandha which has established a prominent position in the premium pan-masala segment. Its product portfolio includes Catch Spices, Pass Pass mouth fresheners, and pan masala, among others.

Manikchand Group

Founded in 1939, this company is mainly known for its pan masala brand Manikchand. Its product portfolio inclu...

JMJ group

JMJ Group is known for its prominent product, Goa Pan Masala, and also offers its services in real estate and ...

*Please note that this is only a partial list; the complete list of key players is available in the full report. Additionally, the list of key players can be customized to better suit your needs.*

Other major India pan masala market players are Godfrey Phillips India Ltd., Kothari Product Limited, Dharampal Premchand Limited, Shikhar Group, Pan Bahar Products Private Limited, Dinesh Pouches Private Limited, KP Group, and Red Rose Group, among others.

The comprehensive EMR report provides an in-depth assessment of the market based on the Porter's five forces model and SWOT analysis.

Innovative India Pan Masala Market Startups

Several startups are developing tobacco-free and herbal products which cater to health-conscious consumers. These products usually consist of ingredients such as cardamom, cloves, and betel leaves, which allow the consumers to enjoy pan masala without worrying about health risks. Furthermore, several companies are offering innovative flavours such as fruit, mint, and chocolate, among others, which especially appeal to young consumers and boost India pan masala demand growth. Lastly, some startups are deploying their product range on e-commerce platforms to reach a large customer base.

Tansen Pan Masala

Tansen Pan Masala is an up-and-coming startup in India which is known for its premium, tobacco-free pan masala. The brand aims to establish a prominent position in the premium market through its high-end packaging, a wide range of flavours, and ingredients which are targeted towards health-conscious consumers. This company is expected to gain a significant share in the coming years due to the growth of health-conscious consumers.

Pan Bahar Crystal

Pan Bahar Crystal is a startup initiative of the famous brand Pan Bahar in India pan masala market as this startup offers tobacco-free pan masala to the customers. There is an increased focus on celebrity endorsements and premium packaging in its product range to make it stand out amongst its competitors. This new range is specifically targeting young consumers who want to enjoy pan masala which does not cause any health risks.