The newly acquired funds will be directed towards expanding the team, enhancing technology, and introducing new product lines.
Kacholia expressed, “The F3 team is addressing a significant challenge for fresh fruit retailers by managing their sourcing logistics and improving their quality of life. Rohit and his team’s extensive knowledge in this field and their emphasis on unit economics convinced us to invest.”
“Our plans to grow rapidly in New Delhi/NCR are in line with our ambition of becoming the largest Fresh Fruits company in India. By year’s end, we hope to reach an annual recurring rate of INR 100 crore,” said Fresh From Farm Founder Rohit Nagdewani.
Fresh From Farm operates as a fresh fruit demand consolidation service. Presently, the brand delivers to over 300 locations daily, emphasizing waste reduction. F3 manages the entire operational process for retailers, encompassing procurement, handling, sorting, and distribution, thereby allowing them to concentrate on sales.
Inflection Point Ventures partner Vikram Ramasubramanian stated, “F3 bridges the gap between affordability & profitability by empowering retailers to market quality produce at fair prices through transparency and efficiency.”
Inflection Point Ventures is an angel investing platform that unites over 14,000 CXOs, HNIs, and professionals to collectively invest in startups. The platform has announced the introduction of Physis Capital, a $50 million category 2 Alternative Investment Fund, aimed at funding pre-Series A to Series B growth-stage startups.
The ongoing controversy involving MDH and Everest spice companies has the potential to jeopardize over half of India’s spice shipments, as per a report. It underscores the urgent need for the country to address the quality issue.
As per the Global Trade Research Initiative (GTRI), an economic think tank, every day, new countries have been raising concerns about the quality of Indian spices.
The report also emphasized the necessity for immediate attention and action to uphold the reputation of India’s spice industry.
The report stated that with nearly USD 700 million worth of exports to crucial markets at risk, and potential losses escalating to over half of India’s total spice exports due to regulatory actions in numerous countries, the integrity and future of India’s spice trade are delicately balanced.
“Swift investigations and the prompt publication of findings are imperative to restore global confidence in Indian spices. Companies found to be in error must face immediate consequences,” it added.
Following the alleged detection of the carcinogenic chemical ethylene oxide in their products, popular Indian spice brands MDH and Everest faced bans on sales in Hong Kong and Singapore. This prompted a mandatory recall from store shelves.
The report highlighted that the primary infractions in these incidents were the discovery of salmonella contamination, a common bacterial source of foodborne illnesses, and ethylene oxide, a carcinogenic substance employed as a fumigating agent.
“If the European Union, which regularly rejects Indian spice shipments over quality concerns, takes similar action, this situation could exacerbate. A rejection across the EU could affect an extra USD 2.5 billion, raising the total potential loss to 58.8 percent of India’s global spice exports,” stated GTRI Co-Founder Ajit Srivastava.
Referring to specific reports, the GTRI indicated that the US, Hong Kong, Singapore, Australia, and now Male have all raised concerns about the quality of spices provided by prominent Indian companies such as MDH and Everest.
“In the fiscal year 2024, India exported spices worth approximately USD 692.5 million to these countries,” Srivastava emphasized, highlighting the high stakes involved.
“If China, guided by steps in Hong Kong & ASEAN based on Singapore’s precedents, decides to enact similar regulations, Indian spice exports may plummet dramatically. The potential consequences might harm exports worth USD 2.17 billion, accounting for 51.1% of India’s global spice exports,” he stated.
Srivastava remarked that thus far, Indian authorities have provided a lukewarm and predictable response.
After facing international criticism, both the Spices Board and the Food Safety and Standards Authority of India (FSSAI) initiated routine sampling. However, according to him, neither these nor any other government agencies have made clear statements regarding the quality of spices.
He expressed disappointment over the absence of transparent communication, particularly considering the extensive laws and protocols established for quality assurance. Despite the assertions of innocence by major companies such as MDH and Everest, their consistent rejections by international entities ought to have alerted both the Spices Board and FSSAI much earlier, he remarked.
He warned that if the quality of products from leading Indian firms is in doubt, it raises concerns about the integrity of spices in the Indian market as a whole.
According to the GTRI report, the current circumstances necessitate a fundamental change in India’s approach to food safety. Transparency, rigorous enforcement, and effective communication are deemed essential for reinstating and upholding the integrity of both its exports and domestic products.
It further emphasized the necessity for fundamental changes in the operations of agencies responsible for regulating quality.
Spices, which encompass dried portions of plants such as seeds, roots, bark, and fruits, are esteemed for their diverse flavors, fragrances, and preservative attributes. Popular examples comprise cloves, cinnamon, ginger, black pepper, cumin, and coriander. Not only do spices enrich taste and imbue dishes with vibrant hues, but they also occasionally mask unpleasant odors, thereby playing a pivotal role in culinary traditions worldwide.
During the fiscal year 2023-24, India’s spice exports reached a sum of USD 4.25 billion, representing a 12 percent slice of the worldwide spice export market.
India’s primary spice exports comprised chili powder leading the roster with USD 1.3 billion in exports, trailed by cumin at USD 550 million, turmeric at USD 220 million, cardamom at USD 130 million, mixed spices at USD 110 million, and spice oils and oleoresins at USD 1 billion.
Aside from cloves and cinnamon, other noteworthy exports were asafoetida, nutmeg and saffron.
India spent USD 1.5 billion on spices imports. The most popular imports were asafoetida ($110 million), coriander and cumin ($210 million), cinnamon and cassia ($270 million), nutmeg ($118 million), and spice oils as well as oleoresins ($354).
India’s main buyers were Bangladesh ($339), the US ($574), and China ($928), which imported spices valued at USD 574 million.
Additional notable purchasers comprised the UAE (USD 256 million), Thailand (USD 193 million), Malaysia (USD 147 million), Indonesia (USD 137 million), UK (USD 122 million), Australia (USD 63 million), Singapore (USD 50 million), and Hong Kong (USD 5.5 million).
The global spice trade reached a value of USD 35 billion in 2023, with China emerging as the leading exporter, boasting exports totaling USD 8 billion in the same year.
According to the GTRI, the top exports include pepper powder (USD 2.4 billion), turmeric, ginger, and fresh and dried garlic (USD 1.6 billion), coriander, as well as cumin seeds (USD 800 million).
Restaurant Brands International (RBI), a multinational fast food corporation, has reported a net income attributable to common shareholders of $230 million for the first quarter (Q1) of 2024, marking a 21.7% increase from $189 million in the same period of 2023.
In the first quarter of 2024, diluted earnings per share amounted to $0.72, compared to $0.61 in Q1 2023.
Revenue surged by 9.4%, reaching $1.74 billion in Q1 2024, up from $1.6 billion in the preceding year.
For the quarter ended on March 31, 2024, income from operations amounted to $544 million, marking a 21.7% increase compared to the $447 million recorded in the prior year. Additionally, adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) rose by 6.6%, reaching $627 million, up from $588 million.
The company’s presence extended as the consolidated restaurant count reached 31,113 by the end of the March 2024 quarter, a 3.9% increase from 29,956 a year earlier.
Comparable sales for the consolidated entity increased by 4.6% year-on-year, while system-wide sales for the consolidated group expanded by 8.1%.
Restaurant Brands International CEO Josh Kobza expressed pride in the diligent efforts of their teams and franchisees in delivering high-quality products, excellent service, and an attractive value proposition for guests consistently.
“Our performance mirrors their dedication and the robust groundwork we’ve laid, positioning us to advance ongoing enhancements in franchisee profitability and fulfill our long-term vision.”
RBI provided long-term guidance spanning from 2024 to 2028, projecting over 3% growth in comparable sales, over 5% net restaurant expansion, and over 8% growth in system-wide sales.
Additionally, the company revealed its investment in the Burger King brand, allocating an extra $300 million to the Long-Term Royal Reset program in the US.
This investment is part of the broader “Reclaim the Flame” strategy, which commenced with a $250 million investment in September 2022 focused on modernizing Burger King restaurants, encompassing technology installations and kitchen equipment upgrades.
The new funding for Royal Reset 2.0 comes after Burger King’s announcement in January 2024 of its acquisition of Carrols Restaurant Group for $1 billion.
The acquisition entails a renovation initiative for 600 Burger King restaurants, aimed at modernizing their appearance. RBI intends to transition nearly all of these establishments to smaller, local operators through refranchising between 2026 and 2030.
DFM Foods, known for its popular salty snacks brands Crax and Natkhat, has expanded its product range beyond INR 5 packs for the first time. Vipul Prakash, the chief executive of DFM Foods, mentioned that the company is now emphasizing larger pack sizes priced at INR 10 and INR 20 to align with changing consumer preferences.
He said, “This shift towards premiumization is leading us to explore opportunities in larger retail outlets and fast delivery channels.”
Companies in the packaged consumer goods sector are progressively focusing on premiumizing their product portfolios to meet the growing demand in urban areas, driven by both quick-commerce and modern trade channels. Additionally, larger pack sizes are proving to be more profitable due to the rising costs associated with packaging.
Prakash stated that DFM has ramped up its emphasis on operational efficiencies and broadened the reach of its snacking brands, extending beyond the North into recent ventures in the East. Plans are underway to extend this expansion to other territories such as the West and South.
A year ago, DFM Foods withdrew from the stock exchanges, sparking speculation that Advent International, the private equity firm with a stake of over 96% in the snack maker, might be considering an exit from the company.
Regarding the speculation of a possible divestment by Advent, Prakash emphasized that his sole focus is on growing the company’s top and bottom lines. He stated, “We are developing a business that will be highly appealing to strategic buyers, perhaps within the next two to three years.”
Prakash, who previously held leadership roles at MakeMyTrip and PepsiCo, emphasized that the past year has seen increased focus on innovation and the introduction of new products.
According to business intelligence platform Tofler, DFM Foods reported revenues of over INR 500 crore for the financial year ending March 31, 2023.
Prakash emphasized that in FY25, DFM will prioritize innovation and distribution to bolster both its top and bottom lines.
Zomato, a leading player in the foodtech sector, has received a fresh penalty notice for Goods and Services Tax (GST) from Delhi’s sales tax officer, pertaining to fiscal 2018-19.
As per a regulatory filing to the stock exchanges, Zomato has been served with a demand order regarding the excess availment of input tax credit for the year 2018-19. This includes the imposition of applicable interest and penalty charges.
According to the filing, the company has been requested to settle an amount of INR 2,22,91,376 for GST, in addition to further charges for interest and penalties totaling INR 2,31,27,300.
In reply to the show cause notice, the company furnished explanations on all matters, substantiated by pertinent facts and documents. Nonetheless, it seems that these were not comprehensively taken into account by the authorities while issuing the order.
In its filing to the exchange on Thursday (May 1), Zomato stated, “The Company is confident in its ability to present a robust defense before the relevant appellate authority and anticipates no financial repercussions on the Company.”
This development comes days after Zomato received a GST notice of INR 11.8 Cr from the Gurugram GST authority.
Earlier this month, Zomato faced consecutive tax notices, one amounting to INR 23 Cr and the other to INR 92 Cr, from the Karnataka tax authority.
It’s worth noting that Zomato is presently encountering numerous tax-related hurdles. In March, the foodtech giant was served a GST penalty notice by Gujarat’s Deputy Commissioner of State Tax for the fiscal year 2018-19. Furthermore, in December of the previous year, Zomato received a show cause notice totaling INR 401.7 Cr from the Directorate General of GST Intelligence, Pune Zonal Unit.
Meanwhile, on April 20, Zomato obtained approval from the Indonesian government to dissolve its subsidiary in the Southeast Asian nation.
In terms of finances, the foodtech leader maintains robust profit and revenue expansion. Zomato saw its net profit soar more than fourfold sequentially to INR 138 Cr in the quarter ended December 2023. Similarly, its operating revenue surged over 15% quarter-on-quarter (QoQ) to INR 3,288 Cr in Q3 FY24.
Raksha Kothari & Vinay Kothari, Co-Founders, Go DESi
Go DESi, a burgeoning startup specializing in packaged Indian delicacies and sweets, has secured INR 41 crore (around $4.9 million) in a funding round spearheaded by Aavishkaar Capital.
The startup plans to utilize the new capital for expanding into new regions, broadening its range of products, and enhancing its operational capacity.
Founded in 2018 by siblings Vinay Kothari and Raksha Kothari, Go DESi aims to modernize traditional Indian treats and confectionery while simultaneously empowering women in rural areas of the country.
It asserts to have sold over 15 million units, with its products stocked in over 40,000 stores nationwide.
Vinay Kothari expressed, “The funding collaboration with Aavishkaar Capital will bolster Go DESi’s product range, expedite marketing efforts, swiftly expand our geographic reach, and broaden our distribution network. This investment validates Go DESi’s commitment to sustainability and will be instrumental in realizing our vision.”
He also mentioned that the startup maintains an omnichannel presence. In the southern states of India, the products are accessible through both online and offline channels, whereas in cities such as Mumbai and Delhi-NCR, Go DESi products are exclusively available through quick-commerce and online grocery applications.
Regarding the product lineup, he mentioned that the startup intends to expand its offerings within the sweets category.
Kothari stated that all products are exclusively manufactured by women, with plans to further increase female employment opportunities moving forward.
Divya Gupta, investment director at Aavishkaar, remarked, “The company has swiftly established a formidable brand and a resilient distribution network. We perceive the opportunity as highly substantial, and the Go DESi team possesses all the necessary elements to seize the ever-evolving confectionery market in India.”
Yum Brands saw a decline in quarterly global same-store sales, attributed to fluctuating demand for its KFC and Pizza Hut brands among inflation-wary consumers both in the United States and abroad.
As inflation lingers, consumers across the United States are showing a growing preference for value-driven dining options. This trend is prompting fast food chains to intensify their efforts in offering promotions, revamping store layouts, and enhancing ordering experiences.
Yum Brands saw a 3.7% decline in premarket trading as the parent company of Pizza Hut experienced its first decrease in total same-store sales in approximately three years, following in the footsteps of coffee giant Starbucks.
CEO David Gibbs expressed, “As anticipated, same-store sales faced pressure this quarter. However, we find encouragement in robust two-year same-store sales growth and the positive momentum as we conclude the quarter.”
According to LSEG data, Yum Brands’ total revenue for the first quarter ended March 31 decreased by nearly 3% to $1.60 billion, falling short of analysts’ estimates of $1.71 billion.
In the first quarter, the company experienced a 3% decline in worldwide same-store sales, contrary to analysts’ expectations of a 0.04% growth.
Despite the launch of KFC’s first loyalty program in the reported quarter, it didn’t succeed in boosting demand for the fast-food giant. Consumers persisted in seeking more economical options, such as meals prepared at home.
In contrast to these results, pizza chain Domino’s has thrived, benefiting from a revamped loyalty program that has retained consumer loyalty over the past two quarters.
Same-store sales at KFC restaurants globally declined by 2%, while Pizza Hut experienced a 7% drop in the same metric.
Taco Bell’s posted a 1% increase, falling short of estimates by 1.83%.
After the recent controversy over food spices exported by India, the central government has directed all state administrations to conduct quality testing on spices.
Earlier, the Food Safety and Standards Authority of India (FSSAI) and the Spices Board initiated regular sampling, but neither organization—nor any other government body—has released any official statements regarding the quality of spices.
In Uttarakhand, the state Commissioner of Food Safety, Dr. R Rajesh Kumar, has issued directives to test all food spices produced within the state. Uttarakhand houses over 50 spice manufacturing units.
“The commissioner has directed the food safety officials of all 13 districts to make visits to spice manufacturing units & conduct sampling to assess the quality of different spices,” said Commissioner of the Food and Drug Administration.
As per a report, the ongoing controversy involving MDH and Everest spice companies has the potential to jeopardize more than half of India’s spice shipments. The report emphasized the urgent need for the country to address the quality issue.
Recently, Food Standards Australia New Zealand (FSANZ) announced its investigation into contamination allegations concerning spice mixes manufactured by Indian companies MDH and Everest. This scrutiny may prompt a product recall in Australia, mirroring actions taken in Hong Kong and Singapore.
The controversy over the alleged detection of the carcinogenic chemical ethylene oxide in their products led to a mandatory recall from shelves. According to the report, the main violations in these occurrences were the presence of salmonella contamination, a common bacterial cause of foodborne illness, and ethylene oxide, a carcinogen used as a fumigating agent.
Nuvama Institutional Equities has adjusted the 12-month price target (PT) for IndiaMart InterMESH downward by 5% to INR 2,650 from its previous INR 2,800, attributing the change to the B2B marketplace’s subdued subscriber growth in the quarter that ended March 2024.
In its report, the brokerage highlighted that IndiaMART’s decelerating subscriber growth is impacting its revenue collections. It upheld its ‘HOLD’ rating on the stock, emphasizing the absence of indications for a rebound in subscriber acquisitions.
This comes after the company announced that its consolidated net profit increased by more than 78% to INR 99.6 Cr in Q4 FY24 from INR 55.8 Cr in the same period the previous year. According to IndiaMART, its total customer collections for Q4 of FY24 were INR 484 Cr.
Nuvama noted that the company’s paid supplier additions remained restrained in the March quarter, with a persistently high turnover rate among new consumers in its ‘silver’ package.
It’s worth mentioning that IndiaMART provides four packages to suppliers – silver, gold, platinum, and diamond. These packages vary in price from INR 1.1 Lakh to INR 6.5 Lakh per annum, with the silver package being the most affordable option.
The subdued turnover of paid subscribers has hindered the startup’s capacity for upselling, specifically in converting paid subscribers from the silver package to higher tiers. Consequently, Nuvama noted, this has had an impact on the overall collections.
The brokerage stated, “Although we recognise the company’s leadership and strong position in the B2B ecommerce market, we think that high churn would keep subscriber addition counts low, thus impacting collection/revenue growth.”
IndiaMART reported 24 million unique business enquiries in Q4 FY24. Commenting on this, the brokerage noted that this growth has been largely consistent over the past three quarters, implying potential challenges on the buyer’s end as well.
Established in 1999, IndiaMART facilitates connections between buyers and suppliers through its online B2B marketplace. It enables buyers to explore a selection of over 10 crore products offered by more than 78 lakh suppliers.
The company witnessed a 17% increase in operating revenue, reaching INR 314.7 Cr in the March quarter of FY24, up from INR 268.8 Cr in Q4 FY23.
In FY24, IndiaMART recorded a consolidated net profit growth of 18%, reaching INR 334 Cr compared to INR 283.8 Cr in FY23. Operating revenue for FY24 stood at INR 1,196.8 Cr, marking a growth of over 21% from INR 985.4 Cr in FY23.
Fortune Hotels, under the umbrella of ITC‘s hotel group, is gearing up to launch a new hotel every month in the ongoing financial year, according to Samir MC, the company’s Managing Director. Sharing the expansion blueprint, Samir highlighted the recent inauguration of Fortune Hotels’ first international property, the Fortune Resort & Wellness Spa Bhaktapur, situated in Nepal.
He characterized it as a major achievement within the company’s expansion strategy aimed at transcending geographical boundaries, with aspirations for establishing a strong foothold in South Asia and neighboring markets.
“Following the recent opening, we’re gearing up to launch at least four to six more hotels in the first half of the fiscal year. These will be in unique destinations like Kevadia (Ekta Nagar, Gujarat), Candolim (Goa), Palampur (Himachal Pradesh), and a beach resort in Chennai, among others. We’re also planning an equal number of openings in the second half from October to March,” Samir stated.
He added, “This pace is in line with our objective of inaugurating a new hotel nearly every month during this fiscal year, signifying substantial advancement towards our expansion objectives.”
Discussing the hurdles confronting India’s hospitality sector, Samir highlighted how economic uncertainties, such as fluctuating exchange rates, geopolitical tensions, and global economic downturns, can influence travel demand and consumer expenditure, thereby presenting challenges for hotels in managing revenue, occupancy rates, and profitability.
He pointed out the growing global travel patterns, propelled by increasing disposable incomes, a craving for distinctive experiences, and enhanced accessibility, as “noteworthy opportunities” for the hospitality sector to allure a varied spectrum of travelers.
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