India’s retailinflation softened marginally, hitting an 11-month low of 4.83 percent annually in April, down from 4.85 percent in the previous month, as per government data released on Monday. A Reuters poll of 44 economists had anticipated the figure to drop to 4.80 percent.
According to data from the National Statistical Office (NSO), inflation in the food basket increased to 8.7 percent in April, rising from 8.52 percent in March.
In April, the inflation rate sequentially stood at 0.48 percent.
India’s year-on-year vegetable inflation was recorded at 27.80 percent, slightly lower than March’s 28.30 percent. Meanwhile, the inflation rates for cereals and pulses, which form a substantial part of India’s staple diet, were 8.63 percent and 16.84 percent, respectively.
During the announcement of the results of the first bimonthly Monetary Policy Committee (MPC) meeting of FY25, Reserve Bank of India (RBI) Governor Shaktikanta Das highlighted inflation as the primary challenge, metaphorically labeling it as “the elephant in the room.” Despite this, he expressed optimism by suggesting that inflation (the elephant) seems to be returning to the desired threshold (the forest) of 4 percent.
In his speech, Governor Das commented, “CPI inflation was the elephant in the room. Now, it seems the elephant has taken a stroll and is heading back to the forest.”
Das emphasized the declining trend of inflation, supported by favorable base effects. Nevertheless, he recognized the ongoing pressure from service prices, which has kept the key indicator elevated compared to the set targets.
The headline inflation for January-February 2024 decreased to 5.1 percent, down from the 5.7 percent recorded in December. Nonetheless, the unpredictable fluctuations in food prices persist, adding to inflation uncertainties.
“Although headline inflation has decreased from its December peak, the persistent influence of food prices is hindering the continuous disinflation process, posing challenges to reaching the target,” remarked Das.
After a correction in January, food inflation rose to 7.8 percent in February, mainly driven by increases in vegetable, egg, meat, and fish prices.
Meanwhile, fuel prices continued their deflationary trend for the sixth straight month in February. The core Consumer Price Index (CPI), which excludes food and fuel, experienced disinflation, falling to 3.4 percent in February. This represents one of the lowest levels in the current CPI series, with both goods and services components seeing a decrease in inflation.
During its April 2024 meeting, the MPC maintained its inflation projection for the fiscal year at 4.5 percent, contingent upon a normal monsoon, despite the nation preparing for a hot summer amidst rising crude oil prices and ongoing concerns about the supply chain due to the Red Sea crisis.
After reviewing Zomato‘s Q4 results, brokerage firm Bernstein upheld its “OUTPERFORM” rating for the foodtech company’s stock and increased its price target (PT) from INR 200 to INR 230.
This marks a premium of over 18% from the stock’s previous closing price of INR 193.7 on the BSE as of Monday (May 13).
In a note, the brokerage firm highlighted Zomato as its “top pick” among Indian new-age tech companies, attributing this choice to the company’s improving profitability and the “impressive” growth of its quick commerce arm, Blinkit.
“Zomato continues to strengthen our belief in achieving the breakeven milestone for its quick commerce business. Blinkit’s growth remains impressive, with a year-on-year increase of 97% and a quarter-on-quarter rise of 14%… The core food delivery business exhibited robust year-on-year growth of 28% in Gross Order Value (GOV), accompanied by profit expansion… We view Zomato as a fundamental internet investment. Consequently, we’ve raised our price target to INR 230,” stated Bernstein.
Additionally, the brokerage firm indicated that Blinkit is poised to maintain its aggressive store expansion strategy, with plans to add 100 stores in Q1 FY25, aiming to reach the milestone of 1,000 stores by the end of March 2025.
Regarding food delivery, Bernstein noted that the foodtech leader experienced robust growth in both average order value (AOV) and order volume in the quarter ending March 2024. They further highlighted that the contribution margin witnessed significant expansion, driven by increased AOV, advertising take rate, and platform fees.
The brokerage firm expressed its approval shortly after Zomato unveiled its financial results for Q4 FY24. Sustaining its profitable trend, the foodtech giant announced a consolidated profit after tax (PAT) of INR 175 Cr for the period, marking a 26% increase from INR 138 Cr in the previous quarter. This stands in stark contrast to the net loss of INR 187.6 Cr reported in Q4 FY23.
Meanwhile, Blinkit, the quick commerce vertical, achieved adjusted EBITDA positivity in March 2024, driven by robust growth in order volume and average order value (AOV) over the three-month period. Despite revenue increasing by 19% sequentially to INR 769 Cr in Q4 FY24, the platform’s EBITDA loss improved to INR 37 Cr, compared to INR 89 Cr in Q3 FY24.
The announcement comes as the foodtech major’s stock continues to witness upward movement on the bourses. With promising financial figures backing it, Zomato’s shares have surged over 210% in the last 12 months and 57% year-to-date (YTD).
In addition, Zomato revealed on Monday its intentions to introduce a new ESOP scheme, wherein it aims to allocate 18.26 Cr stocks to eligible employees. Based on the stock’s recent closing price, this ESOP plan would equate to shares valued at approximately INR 3,500 Cr.
Also on the same day, the company disclosed its intentions for its fintech arm, Zomato Payment, to voluntarily return its online payment aggregator license to the Reserve Bank of India (RBI).
Zomato’s shares concluded 3.82% lower at INR 193.70 on the BSE on May 13th.
A consortium led by Blackstone, the world’s largest private equity fund, in collaboration with Abu Dhabi Investment Authority (ADIA) and GIC of Singapore, reportedly submitted a non-binding bid late last week to acquire a controlling stake in Haldiram Snacks Food Pvt Ltd (HSFPL), as per sources cited by ET. HSFPL represents the combined packaged snacks and foods business of the Delhi and Nagpur factions of the Agarwal family.
Haldiram, a company with an 87-year legacy, stands as India’s leading provider of snacks and convenience foods.
Blackstone and its partners are keen to acquire a 74-76% stake in the company, estimating the business’s value to be between $8-8.5 billion (INR 66,400-70,500 crore). ADIA and GIC serve as limited partners or sponsors of Blackstone’s global funds. Should the deal materialize, it would mark the most significant private equity buyout in India to date.
Blackstone and ADIA refrained from commenting. GIC did not respond to the email.
Haldiram CEO KK Chutani stated, “The company has no comments to provide.”
In May last year, Chutani, former chief executive of Dabur International, was appointed as the CEO of Haldiram’s, marking the first time a professional has taken the helm of the company.
The completion of any transaction hinges on the ongoing merger between the Nagpur and Delhi factions, as per a plan sanctioned by the National Company Law Tribunal (NCLT). This merger is anticipated to conclude within the next three to four months. Approval for the merger was granted by the Competition Commission of India (CCI) last April. Additionally, Blackstone has reached out to its Canadian and other Asian limited partners (LPs), who may participate if discussions advance or the overall deal size increases, according to the aforementioned sources.
However, they emphasized that the non-binding bid does not ensure the formation of a deal.
Bain Capital, which has engaged in extensive discussions with Haldiram’s on multiple occasions in the past, is also in contention, as first reported by Mint on May 7.
As part of the restructuring, the two factions of the Haldiram family divided their FMCG or packaged foods business and their restaurants business into separate entities. Following this, Haldiram Foods International Pvt Ltd (HFIPL) led by the Nagpur faction and Haldiram Snacks Pvt Ltd (HSPL) led by the Delhi family were merged to form a new entity—Haldiram Snacks Food Pvt Ltd (HSFPL). Post-merger, the Delhi faction, led by Manohar Agarwal and Madhu Sudan Agarwal, will possess a 55% stake in Haldiram Snacks Food Pvt Ltd, while the Nagpur faction, led by Kamalkumar Shivkisan Agrawal, will own the remainder.
The third faction of the Haldiram empire, located in the eastern region, is not participating in the merger proceedings.
The snack food enterprise is involved in producing and distributing over 500 varieties of products, including snacks, namkeen, sweets, ready-to-eat and pre-mixed foods, cookies, non-carbonated ready-to-drink beverages, and pasta. Its operations span across 100 countries, with many operating through franchisees, encompassing regions such as the UK, US, and Japan.
The company has further expanded its portfolio with various sub-brands like Minute Khana, Cup Shup, and Cookie Heaven. In January, it ventured into chocolates with the Cocobay brand. Additionally, it is extending its reach into retail supermarkets and quick-commerce platforms to compete with established players like Britannia in cookies and Mondelez and Amul in chocolates. Furthermore, the company has acquired other smaller brands such as Babaji Namkeen, Akash Namkeen, and Atop Foods.
The restaurant business, valued at INR 1,800 crore, is excluded from the transaction.
As per individuals knowledgeable about Haldiram operations, the combined snacks business is anticipated to achieve a FY24 revenue of INR 14,500 crore, with an EBITDA ranging between INR 2,300-2,500 crore. Over the past five years, the business has maintained a compound annual growth rate of 18% in revenue. The average EBITDA margin stands at 14-15%, although it rose to 17-18% last year due to favorable commodity rates and price adjustments in FY23.
The Agarwal family has been in talks with a number of private equity companies between 2016 and 2017 regarding either a minority or majority investment, including General Atlantic, Bain Capital, Capital International, TA Associates, Warburg Pincus, and Everstone.
In 2018-19, spanning over a year, the family engaged in negotiations with Kellogg’s, then the world’s second-largest snack foods maker, to sell a controlling 51% stake at a $3 billion valuation, excluding the restaurant business. However, alterations to the deal terms resulted in the US company ultimately walking away in frustration.
Before that, PepsiCo’s Indra Nooyi had pursued a buyout with the Agarwals. In September of last year, Reuters reported that Tata Consumer Products Ltd was in discussions with the Agarwal family to purchase a 51% stake but hesitated due to the $10 billion price tag. Both companies formally refuted the reports.
A snack food industry veteran remarked, “With the merger nearing completion and a professional CEO in place, the likelihood of a transaction is now more tangible than ever. The next generation lacks the same fervor and dedication to pursue the business, which serves as another catalyst. However, the family is adamant about securing a premium valuation. Ultimately, unlocking value through listing the business is also a viable option, as the public market tends to value operations more than private equity.”
Haldiram’s originated from a sweets and namkeen shop established by bhujia maker Ganga Bishan Aggarwal in 1937 in Bikaner, Rajasthan. Later on, Agarwal divided the business among his sons into three distinct divisions.
Although Haldiram holds a significant share in the snacks market, there are other competitors such as PepsiCo’s brands (Lays, Kurkure), Balaji Snacks, Prataap Snacks (Yellow Diamond), Bikanervala, Bikaji Foods (recently listed), and ITC Foods, known for its chips sold under the Bingo franchise.
A Frost & Sullivan report suggests that the Indian savory snacks market was valued at INR 72,800 crore in 2021 and is projected to reach INR 1,19,000 crore by 2025, growing at a CAGR of 13%. This market can be broadly categorized into western snacks and traditional snacks, with the latter contributing approximately 48% to the total savory snacks market. Traditional snacks include namkeens, bhujia, and ethnic snacks like dry samosa, kachori, chakli, etc. Despite 43.4% of the packaged savory snacks market being unorganized, organized players such as Haldiram, Pepsico (Lays), Balaji, and Bikaji maintain a strong presence nationwide and command significant market share in regional areas. The organized savory snacks market is estimated to be INR 41,000 crore in 2021. Currently, the ethnic namkeen and snacks market is valued at INR 10,800 crore, experiencing substantial growth in recent years, particularly since the onset of the pandemic.
After successfully launching its home-cooked meal service ‘Zomato Everyday’ in Gurugram, foodtech major Zomato is now planning to expand and scale the service in Bengaluru and Mumbai.
During the company’s Q4 FY24 earnings call, a spokesperson stated, “We aim to continue expanding ‘Everyday’. Currently, it’s primarily available in Gurugram, but in the coming months, we plan to launch ‘Everyday’ in Mumbai and Bengaluru. Following that, we will consider additional cities for further expansion.”
However, the company plans to expand this vertical slowly and gradually.
Zomato launched this service in early 2023 as a revamped version of its previous offering, Zomato Instant. Through ‘Zomato Everyday’, the company provides fresh home-cooked meals starting at INR 89.
The service has already been piloted in several localities in Bengaluru.
Zomato stated that after working on the offering for the past year and a half, the company has finally gained the confidence to scale it up.
It is noteworthy that Zomato’s biggest competitor, Swiggy, also recently relaunched its homestyle meal delivery service, Swiggy Daily, in Bengaluru, four years after discontinuing it.
During Q4 FY24, Zomato experienced a decline in the gross order value (GOV) of its core food delivery business, while its quick commerce vertical, Blinkit, showed strong performance.
Zomato’s food delivery gross order value (GOV) increased by 28% year-on-year (YoY) but declined by 0.6% quarter-on-quarter (QoQ) to INR 8,439 crore in the reported quarter.
Overall, the company marked its fourth consecutive profitable quarter, with a nearly 27% quarter-on-quarter (QoQ) increase in profit after tax (PAT) to INR 175 crore in Q4. Operating revenue showed moderate growth, rising 8% QoQ and over 73% year-on-year (YoY) to INR 3,562 crore for the quarter.
Zomato, a leading player in the foodtech sector, has sought approval from its shareholders for the formulation, adoption, and implementation of a new employee stock option plan, Zomato ESOP 2024, to grant 18.26 Cr employee stock options.
In a filing submitted for its Q4 FY24 results, the company stated that its board had greenlit the proposal during today’s meeting.
Under ESOP 2024, each employee will be entitled to one fully paid-up equity share with a face value of INR 1 for every ESOP exercised.
The filing stated that in order for an employee to execute vested options in accordance with the ESOP 2024, they must pay the exercise price, which is the face value of the underlying equity shares of the firm to be distributed upon exercise.
According to the stock’s last closing price, the ESOP plan would equate to shares valued at more than INR 3,500 Cr.
In the shareholder letter accompanying its Q4 results, Zomato CFO Akshant Goyal stated that the supplementary ESOP pool represents 2% of the company’s outstanding share capital on a fully diluted basis.
Expressing the significance of ESOPs in fostering a culture of “long-term thinking and innovation, and instilling a ‘founder mindset’ among senior employees,” Goyal mentioned that the newly established ESOP pool should adequately suffice for at least the next 5 years.
Zomato’s ESOP expenses amounted to INR 161 Cr in Q4 FY24, compared to INR 122 Cr in the previous quarter. Goyal noted that the company anticipates a further increase in ESOP expenses for FY25 due to the allocation of ESOPs to Blinkit‘s leadership team and senior employees.
To be clear, the establishment of the new ESOP pool indicated above won’t raise ESOP fees on its own. Goyal continued, “ESOP charge is a non-cash item and is booked only when the ESOPs are distributed to employees.
Zomato recorded a 26% increase in sequential growth for consolidated net profit, reaching INR 175 Cr for the quarter ended March 2024. This compares to a consolidated net profit of INR 138 Cr in Q3 FY24.
Meanwhile, Zomato’s subsidiary Zomato Payment has opted to voluntarily surrender the license it obtained from the Reserve Bank of India in January to operate as an online payments aggregator.
The company will utilize the raised capital to bring more international brands to the Indian market and upgrade its technology platform.
Founded by Anil Agrawal, BEYOBO serves as a conduit for Indian SMEs seeking to import goods from global markets, while also facilitating the expansion of foreign brands and sellers into the Indian market.
Anil Agrawal, CEO and Co-Founder of BEYOBO, said, “We’re not merely establishing a platform; we’re pioneering a category that will revolutionize the perception and execution of cross-border transactions worldwide, leveraging our own two-decade expertise in the field. With profitability in our sights as we prepare for a Series A round, the horizon appears remarkably promising.”
BEYOBO has set its sights on becoming a multibillion-dollar B2B digital cross-border leader within its sector. Having doubled its growth in the past year, the platform offers a diverse array of products spanning categories such as cosmetics, mobile and accessories, household goods, and more.
Expressing his perspective, Bikky Khosla, Lead at Indian Angel Network, remarked, “Our continued investment across the last three rounds, including the present one, underscores our confidence in the company’s potential and their adept execution of their vision. We firmly believe that BEYOBO is primed to leverage its early mover advantage, supported by a seasoned team, to secure a significant market share in the cross-border e-commerce landscape.”
Hiren Turakhia, Lead at Indian Angel Network, “Our experience with BEYOBO has been characterized by a profound grasp of their robust business model and an outstanding alignment between the founder and the market. Their unwavering commitment to excellence and innovation instills confidence in their capacity to spearhead the cross-border commerce domain.”
As of 2023, the B2B e-commerce market in India surged to $18.2 billion, according to data from Statista.com, a significant leap from $5.6 billion in 2021. With the sector’s robust performance, analysts foresee the market size reaching an estimated $60 billion by 2025, marking a remarkable milestone in India’s digital commerce landscape.
Namaskara, the latest addition to India’s vibrant street food culture, has launched its operations in Gurgaon with six locations, aiming to redefine the everyday dining experience. Embracing the mantra “The day begins,” Namaskara seeks to transform how office workers perceive their daily meals, offering tasty, nutritious, and hygienic options at budget-friendly prices. Operating through a food truck and food container model, the brand has introduced its services across six different spots in Gurgaon, with plans to expand to 20 locations in FY 24-25.
Riya Satti, Namaskara’s Chief Operating Officer, expressed, “This concept has been in the works for years, and we’re thrilled to finally unveil it.” Situated at one of Gurgaon’s premier base kitchens, sprawling across 5000 square feet and with the capacity to cater to 15,000 meals daily, Namaskara offers an extensive array of breakfast, lunch, and dinner choices, all priced between 50 and 150 rupees. The brand is committed to delivering quality, accessibility, and affordability as its pillars of hospitality.
Rohit Singh, Founder and CEO of Building Brands for Tomorrow (BBFT), highlighted the pivotal role of Namaskara’s debut in the $41 billion market. “Namaskara effectively addresses industry gaps concerning hygiene, efficiency, and organization,” he emphasized. Besides its standard menu, Namaskara extends its services to catering for corporate events, ensuring a smooth dining experience for its clientele. With the capability to serve upwards of 15,000 individuals daily, Namaskara is aptly positioned to fulfill the escalating demand for nutritious and hygienic meals within the corporate sphere.
Farmley, known for its nutritious snacks, has announced its transition to palm oil-free products. Over the course of a year, the company has diligently replaced palm oil with healthier alternatives such as olive oil, ghee, or zero-oil across its entire product range, reaffirming its dedication to revolutionizing healthy snacking.
Palm oil, a commonly utilized vegetable oil, has raised both environmental and health-related concerns due to its high saturated fat levels. In an industry where blended palm oil is widespread, typically comprising 80-90% palm oil and only 10-20% olive oil, Farmley distinguishes itself as a trailblazing brand by attaining a 100% Palm Oil-Free status.
In its endeavor to establish a product range entirely free of palm oil, the company launched the “Palms Off Palm Oil” campaign. This initiative educates consumers about the detrimental impacts of palm oil on both health and the environment, with the aim of increasing awareness about its role in deforestation, wildlife habitat loss, and climate change.
“Our mission at Farmley is to ensure our customers’ well-being and satisfaction. Our journey to become completely palm oil-free began six months ago, prompted by feedback from some of our customers who expressed concerns about palm oil in our products during regular surveys. Customer feedback is more than just suggestions; it is a driving force behind our business decisions.
We are proud to be among the pioneers transitioning our entire product range to be palm oil-free, replacing it with zero-oil, olive oil, or ghee alternatives. This shift not only benefits the health of our consumers but also strategically positions us in an emerging F&B segment focused on food quality and health. As we continue to innovate, our commitment remains steadfast in providing snacks that are not only delicious but also mindful of our planet and its inhabitants,” expressed Akash Sharma, Co-Founder of Farmley, reflecting on the transition.
A study published in the National Library of Medicine reveals that palm oil serves as a primary ingredient in almost half of the most commonly consumed food and consumer items, including numerous popular snacks. With its composition comprising 5 percent saturated fatty acid, palm oil has been linked to raising LDL or ‘bad’ cholesterol levels in the bloodstream. This increase contributes to higher levels of unhealthy fats in the body, thereby heightening the risk of cardiovascular diseases.
Farmley’s snacking range is accessible for purchase on various online commerce platforms such as Amazon, Flipkart, Blinkit, Zepto, and Instamart, in addition to retail stores.
Experiencing a meteoric rise in demand and strategically pricing itself, The Glenwalk Scotch Whisky is rewriting the rules of the Indian whisky market. Launched in June 2023 with Sanjay Dutt as its brand partner, The Glenwalk has tapped into the expertise of Cartel Bros, led by co-founders Mokksh Sani, Jitin Merani, Rohan Nihalani, Manish Sani, and their Chief Business Officer Neeraj Singh, to achieve phenomenal success. Crafted by one of the world’s leading Scotch whisky manufacturers from Scotland, it sets new standards for excellence and innovation.
The Glenwalk accomplished an impressive feat by selling out its initial inventory of 1,20,000 bottles in just four months—exceeding projections by a remarkable 4X. This outstanding accomplishment, covering Mumbai, Thane, and Pune, resulted in an 18% market share capture within its category in Maharashtra within the first three months alone, firmly establishing The Glenwalk as one of India’s fastest-growing whisky brands. With ambitious targets set, the brand aims to sell 28 lakh bottles in the upcoming financial year, reflecting its confident expansion plans.
Recognizing a gap in the market for high-quality yet budget-friendly Scotch whisky, the Cartel Bros team embarked on a daring venture. They unveiled a distinctive blend crafted from the finest Scotch malts and grains, matured for three years, and strategically priced to rival premium Indian whiskeys. This proposition of value has struck a chord with consumers, fueling remarkable sales figures and fostering brand loyalty.
“The rapid expansion of The Glenwalk highlights the significant opportunity for premium yet accessible Scotch whisky in the Indian market. We firmly believe that our strategic expansion initiatives will cement The Glenwalk’s status as a key player in the industry,” affirms Mokksh Sani, Founder of Living Liquidz, Mansionz, and co-founder of The Glenwalk.
The Glenwalk, with a well-defined national expansion strategy, is well-positioned to expand its presence throughout India. The brand is rapidly expanding its reach, with plans to cover all major cities in Maharashtra by the end of March 2024, up from its initial launch cities of Mumbai, Pune, and Delhi. In the coming months, prospective growth areas include Haryana, Punjab, Chandigarh, Uttar Pradesh, Karnataka, and Telangana. To accommodate various consumer preferences, the brand has also introduced festive edition packs and expanded its product line with 350ml and 1-liter bottle sizes.
“We’re delighted by the fantastic response to The Glenwalk. Consumers value our emphasis on quality and affordability. Our dedication lies in crafting a robust brand that resonates with whisky enthusiasts throughout India,” said Jitin Merani, Founder of Drinq Bar Academy and co-founder of The Glenwalk.
The Glenwalk’s outstanding product quality has been acknowledged with a Gold Medal victory at the esteemed Prowine 2023 Spirits Competition (blind tasting format). Its deep, lustrous hue and alluring aroma of treacle, flapjack, and sweet caramel captivate the senses, while its sumptuous mouthfeel and lingering notes of fruit and spice create a lasting impact. Remarkably, The Glenwalk distinguishes itself as the sole affordable Scotch whisky choice in the Indian market, presenting consumers with a genuinely distinctive and valuable offering.
The Glenwalk Scotch Whisky transcends being merely a drink; it represents a paradigm shift in the Indian whisky market. By delivering premium quality at an affordable price point, The Glenwalk inspires the aspirations of a new generation of whisky enthusiasts and is strategically poised for further nationwide expansion.
Foodtech giant Zomato‘s subsidiary, Zomato Payment Private Limited (ZPPL), has opted to voluntarily surrender the certificate of authorization granted by the Reserve Bank of India (RBI) for its operation as an online payment aggregator.
The company announced this in its Q4 FY24 financial filings.
Additionally, it stated, “ZPPL has also chosen to voluntarily withdraw its application with the RBI (for which it previously received provisional authorization) to function as an issuer of pre-paid payment instruments under the Payment and Settlement Systems Act, 2007, and the Master Direction on Prepaid Payment Instruments. Nonetheless, ZPPL’s other operations will persist.”
This development comes months after the company obtained the license from the central bank to function as an online payment aggregator, effective from January 24, 2024.
In 2021, Zomato announced the establishment of ZPPL, its wholly owned subsidiary, tasked with conducting business as a payment aggregator and an issuer of prepaid payment instruments.
It’s worth mentioning that Zomato introduced an in-house Unified Payments Interface (UPI) service for both peer-to-peer (P2P) and merchant transactions last year. However, there were also reports indicating that the company temporarily halted the onboarding of new users in its UPI vertical.
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