Khadim India to demerge distribution business by September, expects margin improvement by 100-200 bps

February 27, 2024

Khadim India Ltd, a leading footwear company, is expecting to complete the demerger of its distribution business by September this year, as stated by an official on Monday. The company is hopeful that its margins will expand by 100-200 basis points by FY’26.

This strategic move is poised to unlock substantial value for its core retail business comprising approximately 848 stores under Khadim’s brand, which commands nearly 67% of the total revenue, he said.

Khadim’s Chief Financial Officer, Indrajit Chaudhuri, stated, “We are already in the process of demerger. Now, it is pending before the stock exchanges and then it will be placed before NCLT for its approval. We expect that the process will be completed by September. The demerger will be effected after the approvals are in place.”

Continue Exploring: Indian footwear industry set for exponential growth, projected to reach $90 Billion by 2030: GTRI Report

In an effort to enhance market focus and operational efficiency, KIL had previously announced its decision to separate its distribution business and manufacturing activities into KSR Footwear Ltd (KFL).

Chaudhuri projected that post-demerger, Khadim India‘s EBITDA margin would witness a substantial improvement, possibly by 100-200 basis points (bps) in its first full year of operation in FY’25-26.

“Now the EBITDA margin in retail is 17% and after demerger, we will be able to put greater focus, which will be reflected in the improvement of margins. We expect the retail business, which is currently at INR 500 crore, to surpass INR 600 crore by 2025-26,” he said.

Chaudhuri emphasised that the priorities of both businesses are distinct and cannot be adequately addressed within a single entity.

The distribution business is facing pressure, following the GST hike from 5% to 12% on footwear below MRP of INR 1,000 since January 2022.

“Owing to the GST structure change, the distribution business had become a drag on KIL, and its (retail) true value was not reflecting,” the official said.

This business, encompassing a vast network of 732 distributors, predominantly serves lower and middle-income consumers across India’s multi-brand outlets.

Accounting for 33% of the total turnover, it specialises in providing branded and affordable footwear across Tier I to Tier III cities and 96% of its products are manufactured in-house.

The retail business relies on Khadim’s outsourcing division to meet the dynamic demands of the market.

Chaudhuri acknowledged that demand remains subdued, particularly in rural areas, attributed to premiumisation trends.

However, he remains optimistic about an improvement in the demand scenario in the next one to two quarters.

Continue Exploring: D2C footwear brand Fausto makes foray into UAE market through Amazon

D2C footwear brand Fausto makes foray into UAE market through Amazon

SnackTeam

February 27, 2024

Fausto, the D2C online footwear brand, announced on Monday its entry into the UAE market through e-commerce giant Amazon with the introduction of a plus-size collection tailored to the preferences of UAE customers.

As part of its growth strategy in the new market, the company emphasized its dedication to men’s ethnic and formal wear.

The company stated that this strategic maneuver underscores Fausto’s dedication to global expansion and providing high-quality footwear choices to a broad spectrum of consumers worldwide.

Continue Exploring: Indian footwear industry set for exponential growth, projected to reach $90 Billion by 2030: GTRI Report

The expansion into the UAE represents the first phase of its broader international expansion strategy, it said and added that the company has set goals to achieve 10 per cent of its total revenue by the next financial year.

Fausto’s said its decision to enter the UAE market via Amazon.ae is based on a deep understanding of the evolving online retail landscape in the region.

The UAE market exhibits a burgeoning demand for quality footwear, coupled with a growing trend towards online shopping, especially post-pandemic, it said.

Noting that the company recognises this transition as an opportunity to introduce its offerings to UAE consumers, the company said it aims to carve a distinctive niche in the UAE market with a diverse range of footwear options tailored to the specific preferences of the region.

Continue Exploring: Luxury footwear industry in India faces challenges amid BIS certification issues

Tim Hortons expands presence in India with third airport store at New Delhi’s Terminal 1

News

SnackTeam

February 27, 2024

Tim Hortons, the renowned international coffee house and restaurant chain, has opened its third airport store at Terminal 1 of the Indira Gandhi International Airport in New Delhi, as per a social media post by a company official.

“We are proud and joyous to announce the opening of our 3rd airport store in India at #NewTerminal1 at NewDelhi IGIAirport and now opened 28th Stores in India,” said Davesh Mehra, North Lead – Projects, Tim Hortons India said in a LinkedIn post.

“A coffee on the go, a quick email to be shot out from our very comfortable seating space, a neatly packed sandwich, a small bite when you’re hungry but not so sure, a box of doughnuts to take to your loved ones, or simply, finding some genuine warmth and care in a hectic environment: we have it all!. So the next time you’re flying out of New Delhi, check us out,” added Mehra.

This marks the coffee chain’s 28th store in India.

Continue Exploring: Tim Hortons continues rapid growth in India with addition of two new stores, including first airport outlet

In August 2022, the cafe chain made its first appearance in India by launching two outlets in the National Capital Region (NCR). Its entry into the Indian market was facilitated through an exclusive master franchise agreement with AG Café, a joint venture entity co-owned by the retail conglomerate Apparel Group and Gateway Partners, an emerging markets alternative investment manager.

Presently, the coffee retailer operates in various cities including Bengaluru, New Delhi, Chandigarh, Pune, Gurugram, Noida, Ludhiana, and Mumbai.

Established in 1964 by Canadian hockey players Tim Horton and Jim Charade, Tim Hortons is managed globally by Restaurant Brands International Inc., boasting a network of over 5,100 restaurants spanning across 15 countries.

Continue Exploring: Tim Hortons plans major expansion along Indian highways, aims to open 120 stores by 2026

Maharashtra launches statewide fast-food chain inspections after McDonald’s cheese controversy

News

SnackTeam

February 27, 2024

After the discovery of misleading claims regarding the substitution of real cheese with alternatives in burgers and nuggets at a McDonald’s outlet last week, the state of Maharashtra will be inspecting outlets of all global fast-food chains for food regulation violations, as reported by Reuters citing an official source.

Following McDonald’s crackdown, Maharashtra will intensify its inspection efforts by checking for misleading promotion of non-cheese items falsely advertised as containing cheese. All McDonald’s outlets in Maharashtra will be inspected by the state’s Food and Drug Administration (FDA) as part of this heightened oversight initiative.

“We are planning to check all outlets of McDonald’s,” Abhimanyu Kale, the FDA chief told Reuters. “We will also take action on other well-known and frequently visited global fast-food chain outlets,” he added, but declined to identify the brands being targeted.

Continue Exploring: McDonald’s faces regulatory heat: Maharashtra FDA revokes license amid cheese substitution allegations

Saurabh Kalra, Managing Director of Westlife Development, the company operating McDonald’s in western and southern India, expressed readiness for any inspections and affirmed their commitment to maintaining the “highest standards”.

The company’s shares dropped to INR 762 when the news surfaced, but later regained ground.

The FDA had temporarily suspended the license of a McDonald’s outlet in Ahmednagar, prompting the chain to remove the term “cheese” from several items. However, the license was subsequently reinstated.

Continue Exploring: McDonald’s removes ‘cheese’ from outlet menus in Maharashtra following FDA suspension

The regulator accused McDonald’s of using cheese analogs without adequate disclosure, leading consumers to believe they were consuming real cheese. The state FDA has also urged the chain to implement corrective measures across the state and potentially nationwide.

Following the crackdown, Westlife Foodworld issued a clarification last week, stating that it is actively communicating with the relevant authorities regarding this matter and awaiting their final clarification.

“We have always been adhering to stringent food standards and are fully compliant with all applicable food laws. Our commitment to transparency in our ingredients and dedication to providing delicious, high-quality meals to our customers remains unwavering,” the company said.

Continue Exploring: McDonald’s engages with authorities amid controversy over cheese substitutes

Businesses should nurture startups without seeking ownership, says Zomato CEO Deepinder Goyal

SnackTeam

February 27, 2024

On Tuesday, Deepinder Goyal, the founder and CEO of Zomato, emphasized the importance for established businesses to support and foster startups without the aim of acquiring them.

“I think established businesses need to nurture startups…and I don’t think we have that kind of a culture yet, and larger businesses also need to start funding startups but not with an intention to own them but with an intention to help them become bigger,” Goyal said, at the curtain raiser event of the Startup Mahakumbh, which is slated to happen on March 18-20.

Adding to the comments of the Zomato chief executive, Sanjeev Bikhchandani, Vice Chairman of Info Edge India, stated that investing in startups was one of the key strategic areas for Info Edge. Notably, the Noida-based company is an investor in Zomato.

Zomato has investments in various consumer tech startups, such as the hyperlocal commerce platform Magicpin, ecommerce enablement startup Shiprocket, and the health and fitness firm Cultfit.

Continue Exploring: Zomato’s strong Q3 performance spurs brokerage firms to boost price targets; Blinkit expansion drives optimism

The central government is hosting the Startup Mahakumbh event, bringing together over 1,000 startups and a diverse array of investors, including angel investors, high-net-worth individuals, venture capitalists, and family offices.

Bikhchandani is part of the organizing committee of the Startup Mahakumbh event alongside Prashanth Prakash, a partner at Accel, Sanjay Nayar, founder and chairman of Sorin Investments, and Archana Jahagirdar, managing partner at Rukam Capital.

“Today, India is the third largest startup ecosystem in the world…and the goal, as laid by the minister, is to make it the largest startup ecosystem in the world. We are going to have startups from different states and districts in India, and also a bit of an international touch. The whole Mahakumbh has been broken into 10 verticals…from climate and D2C to B2B and SaaS,” Nayar, who is also the former CEO of KKR India, said.

Meanwhile, the government has also launched the Bharat Startup Ecosystem Registry to establish a single-platform database of startups, investors, incubators, and other stakeholders.

“Today, the Indian startup is growing on all fronts with tremendous support from enablers across the country. To match the pace of the ecosystem, we are unveiling the Bharat Startup Ecosystem Registry. We should have data-supported figures of the entire ecosystem and the aim is to unify all stakeholders under a cohesive framework for seamless coordination and facilitating networking opportunities,” said Sanjiv, joint secretary, department for promotion of industry and internal trade.

Continue Exploring: Zomato reports third consecutive profitable quarter with INR 138 Cr PAT in Q3 FY24

Farmtheory secures $1.45M seed funding from Merak Ventures to reduce food waste and boost farm yields

SnackTeam

February 27, 2024

Farmtheory, an agritech startup, has secured $1.45 million (INR 12 crore) in seed funding from Merak Ventures.

The startup plans to utilize the fresh capital to scale up its operations, primarily by expanding its supply arm, enhancing its technological infrastructure, and bolstering its supply chain through outreach to more farmers. This approach aims to ensure a robust and sustainable source of produce.

Established in 2019 by Arpit Agarwal and Sakshi Agarwal, Farmtheory aims to minimize food waste at its source, increase farm yields, and deliver quality ingredients to commercial kitchens.

Farmtheory labels the unsold produce as ‘freeform’ and procures it directly from farmers, supplying it to various buyers including cloud kitchens, catering companies, food processors, and restaurants. This produce can be utilized by buyers in the same manner as conventionally shaped produce.

Continue Exploring: Y Combinator-backed Guac fights food waste with customized, AI-based forecasts

The Bengaluru-based startup aims to boost farmer incomes, mitigate food loss, and combat climate change by redirecting edible produce to new markets rather than letting it go to waste.

Farmtheory asserts that it has enlisted 3000 partner farmers to date and has catered to over 1500 kitchens. Moreover, the company intends to substantially expand its network of partners and geographical reach, moving forward to extend the benefits of its innovative model to more farmer communities across the nation.

“Farmtheory embodies a vision where every connection between farmer and consumer signifies more than just a transaction — it represents a commitment to enriching lives and fostering sustainability. Through our platform, we empower farmers to share their harvests with the world, creating meaningful connections that sustain communities and promote environmental responsibility,” said Arpit Agarwal.

Sheetal Bahl, Partner at Merak Ventures, expressed that Farmtheory is not only tackling the issues of food waste, farmer income, and climate change but also envisioning innovative solutions with the capacity to revolutionize the agricultural and food industry.

According to market research, the Indian agritech startup ecosystem is projected to have a total market opportunity worth $24 billion by 2025. Analysis shows that these startups have already secured more than $2.4 billion since 2014.

Continue Exploring: Shilpa Shetty-backed agritech startup KisanKonnect secures INR 31 Crore in pre-series A funding led by Green Frontier Capital

Lay’s teams up with David Beckham and Thierry Henry for epic ‘No Lay’s, No Game’ return, surprising 75,000 fans

SnackTeam

February 27, 2024

Do you have Lay’s? Well, this apparently simple question could lead to surprising rewards, at unexpected moments, and sometimes from unexpected sources. Lay’s, the world’s top chip brand and official snack partner of the UEFA Champions League (UCL), has launched No Lay’s, No Game 2024, rewarding fans who are ready for game day with Lay’s throughout the tournament. Through an ambitious “Chip Cam” stunt featuring football superstars David Beckham and Thierry Henry, as well as an immersive digital experience with the Lay’s Detector, Lay’s is bringing joy to football fans worldwide who watch the beautiful game with Lay’s in hand.

“We’ve heard from football fans from all over the world and they tell us the same thing: whether watching with a group of friends or at home solo, the experience is always better when sharing a bag of Lay’s,” said Ciara Dilley, vice president of marketing, Global Foods Group at PepsiCo.

“This year, No Lay’s, No Game is giving fans even more reasons to have Lay’s in hand. For those who do, something truly remarkable might happen. And those who don’t? They may be left missing out,” she added.

Continue Exploring: Lay’s gets a desi twist: AI imagines a chip lineup featuring Dhokla, Chole Bhature, and More

This year, Lay’s embraced an adventurous approach for its campaign, enlisting Beckham and Henry to pose the question, “Do you have Lay’s?” to a crowd of 75,000 cheering fans at San Siro during one of the most anticipated matches of the UEFA Champions League season between AC Milan and PSG. Just before kick-off, Beckham discovered, and couldn’t believe, that Henry had eaten all of his Lay’s chips. To resolve it in just five minutes, the two put out a call through the Lay’s “Chip Cam” – an unexpected spin on the traditional kiss cam.

In a thrilling yet amusing quest to locate Lay’s, the Chip Cam sweeps through the crowd. Beckham and Henry observe as spectators offer various items on the jumbotron – from pizzas to empty Lay’s bags, even a couple engaged in a kiss – all eager to catch attention. Finally, much to Beckham and Henry’s delight, two fortunate fans, a father and daughter, are spotted with Lay’s and are invited to enjoy the game alongside the iconic football stars. This demonstrates that having Lay’s can unlock an extraordinary football viewing experience. This epic pursuit to discover fans with Lay’s, leading to an unparalleled viewing opportunity for the fortunate winners, serves as the highlight of this year’s No Lay’s, No Game commercial and will be broadcast throughout the UCL tournament season.

“We had a great day filming at the San Siro stadium for No Lay’s, No Game. Whenever Thierry and I get together it’s always a lot of fun – and it was fantastic being able to surprise 75,000 fans,” said Beckham.

“Last year, I teamed up with Lay’s to surprise some of football’s biggest fans by literally going to their doors to see if they had Lay’s – and if they did, I stayed and watched the match with them,” said Henry. “This year, we really upped the ante with the Lay’s Chip Cam, and it was truly an exhilarating experience being back in the stadium with David. We spent a lot of our careers playing against each other on the pitch, so there’s something special about coming together with Lay’s in a whole new way to offer a once in a lifetime experience for fans.”

The collaboration for the campaign involved Slap Global and was directed by the award-winning commercial and television director, Andrew Lane.

While not everyone can attend the San Siro, Lay’s is bringing No Lay’s No Game to your home. In collaboration with Meta and Simone, Lay’s has introduced the Lay’s Detector, a distinctive digital experience offering football fans in select countries around the globe the opportunity to win exciting prizes throughout the UCL tournament. How does it work? Fans need to demonstrate they have Lay’s with them while watching a match. To utilize the Lay’s Detector, simply scan the QR code found on Lay’s social channels or the No Lay’s, No Game commercial to activate the effect. Subsequently, fans will be prompted to confirm their Lay’s possession – and if confirmed, they’ll be eligible to win exclusive prizes, content, and even tickets to the UCL Men’s Finals at Wembley Stadium in London. And if they don’t have Lay’s handy? Not to worry, fans will still have additional opportunities to showcase their Lay’s bag for a chance to win epic prizes throughout the remainder of the season.

Continue Exploring: Unilever named official sponsor of UEFA EURO 2024, bringing favourite brands to the pitch

Food delivery app surge leaves QSRs struggling with revenue and margins amidst fragmented sales: BNP Paribas Report

SnackTeam

February 27, 2024

With the exponential surge of food delivery apps like Zomato and Swiggy, quick service restaurant operators are grappling with significant challenges, as outlined in a report by French brokerage BNP Paribas. The report emphasizes that both revenue and margins are under severe strain, with the journey to recovery proving longer than initially estimated. It points out that the increasing popularity of food aggregators has adversely impacted dine-in sales for quick service restaurants (QSRs) and has also fragmented delivery sales.

Additionally, as more restaurants collaborate with food delivery platforms, consumers now enjoy a broader array of options, resulting in fragmented sales. This factor is likely contributing to the decline in average daily sales within the quick service restaurant (QSR) industry, alongside the overall weakness in demand due to heightened inflation, as emphasized in the report.

Pizza, the most delivery-friendly option, is facing intense competition as more cuisine options have become available to consumers.

Continue Exploring: Indian appetite for pizzas and burgers wanes: Domino’s and McDonald’s franchisee results reflect decline in dining out trends

“While inflation may also be hurting demand, there are other factors at play, and we think the road to recovery could be longer than what the market estimates,” the report said.

The report noted that Zomato and Swiggy have experienced over a threefold increase in restaurant onboarding, soaring from 278,000 in FY2020-21 to surpassing 700,000 in FY2022-23.

Zomato’s average monthly active restaurant partners jumped from 61,000 in FY19 to 2,54,000 as of third quarter FY24, while Swiggy had 2,72,000 active restaurants as of FY23, French brokerage BNP Paribas said in a report.

The report highlighted that the overall scale of food delivery companies has undergone substantial growth, enhancing customer reach, particularly benefiting smaller restaurants. It further noted that the increasing popularity of food aggregators has adversely affected dine-in sales and led to the fragmentation of delivery sales.

Continue Exploring: KFC, Pizza Hut operator Sapphire Foods reports biggest quarterly profit drop since 2021 IPO

In light of this context, concerning Quick Service Restaurants (QSRs), the report stated that contrary to expectations of a potential recovery in the third quarter of the current fiscal year, the top-line growth was notably weaker than anticipated by consensus.

In the third quarter of the current fiscal year, industry revenue growth declined to 7 percent year-on-year, down from 20 percent in the third quarter of FY23. This drop occurred despite a 15 percent increase in store count year-on-year; however, average daily sales decreased. Although gross margins expanded due to lower raw material prices, operating margins decreased for most Quick Service Restaurant (QSR) firms due to increased employee and store-related costs, according to the report.

Continue Exploring: North India’s first ‘Pizza ATM’ debuts at Chandigarh’s scenic Sukhna Lake

Luxury hotel chains in India expand branded residences amid rising demand from high-net-worth individuals

SnackTeam

February 27, 2024

Encouraged by growing demand from high-net-worth individuals, luxury hotel chains in India are expanding their portfolio of branded residences to cater to a wealthy clientele seeking premium living experiences.

Marriott International, the world’s largest operator of hotels and branded residences, and a pioneer in managing standalone branded residences, has recently signed its first agreement for JW Marriott-branded residences in India, starting in Hyderabad, and is currently in negotiations for additional locations. Likewise, Hilton is actively exploring opportunities to expand the reach of its luxury brands such as Waldorf Astoria and Conrad into major cities to introduce branded residences.

In May 2022, India’s EIH partnered with B I Luxury for its inaugural project, Trident Residencies. According to Shashank Bhagat, chairman of BI Group, the apartments and penthouses will be ready for possession by October this year. These standalone properties, featuring five-star amenities and priced between INR 18 crore and INR 45 crore, do not share premises with hotels. Among the notable owners are Sunil Kant Munjal, chairman of Hero Enterprise, and the Pai family of the Manipal Group.

Hotels set to achieve 11-13% revenue growth in next fiscal despite high base: CRISIL Ratings

Hotel operators and investment advisory firms report that India’s affluent are increasingly drawn to branded residences due to their access to world-class amenities and personalized services synonymous with luxury hotels. They note that while this concept is firmly established in developed hospitality markets such as the US, Middle East, and Europe, it is now gaining momentum in India.

“Developers are gearing up to seize the immense potential, forging lucrative partnerships. We’re actively conducting feasibility studies and brand affiliation assignments for projects in Solan, Chikmagalur, Goa, Dharamshala, and Udaipur,” said Nandivardhan Jain, CEO of Noesis Capital, a hotel consulting and advisory firm.

Penny Trinh, senior director, mixed-use development, APEC, Marriott International, said, “The increasing number of UHNWIs/HWNIs in India, along with a growing demand among domestic consumers for a lifestyle that mirrors our brands’ design, services, and amenities that consumers have come to love during their travels, offers exciting growth opportunities for branded residences.”

Trinh noted that prime urban areas such as the NCR region, Mumbai, Bengaluru, Hyderabad, and Chennai, along with resort destinations like Goa, Himachal Pradesh, and Udaipur, are perfect settings for branded residences. Suma Venkatesh, Executive Vice President of Real Estate and Development at The Indian Hotels Company, which operates the Taj brand of hotels, concurred with this assessment.

“There is potential for Taj branded residences along with a hotel development in every metro city,” she said.

In April 2022, IHCL made its debut in the branded residences sector by signing another Taj hotel in Chennai. The forthcoming development, operating under a management contract, will incorporate branded residences within the hotel complex. This greenfield project will consist of a luxury hotel offering 235 rooms alongside 123 Taj branded residences. Construction is currently in progress, she confirmed.

“We are seeing a healthy demand for this segment fuelled by the boom in the real estate market and growth in wealth accumulated by HNIs. The growing economy and evolving consumer preferences are also some contributing factors to grow the appetite for luxury living experiences; one can only expect more innovation and diversification in this space,” said Zubin Saxena, senior vice-president and country head, India, Hilton.

On average, branded residences typically command a 30% price premium over non-branded residences in various markets. Homebuyers are inclined to invest in reputable brands that provide assurance of quality, she highlighted. Early entrants into the segment in Mumbai include Ritz Carlton, Leela Hotels, and Four Seasons, who have already established branded residences.

Bhagat of BI mentioned that their “company is currently in the stages of acquiring land for an additional project under the Oberoi brand in Bengaluru.” He emphasized that the primary challenge for such projects, particularly in metropolitan areas like Delhi, is land acquisition. Requests for comments sent via email and text message to a spokesperson for EIH went unanswered as of press time.

ICRA forecasts 7-9% revenue growth for Indian hotel industry in FY25

1...611612613...1,400 Page 612 of 1,400

NewsHub

Khadim India to demerge distribution business by September, expects margin improvement by 100-200 bps

D2C footwear brand Fausto makes foray into UAE market through Amazon

Tim Hortons expands presence in India with third airport store at New Delhi’s Terminal 1

Maharashtra launches statewide fast-food chain inspections after McDonald’s cheese controversy

Businesses should nurture startups without seeking ownership, says Zomato CEO Deepinder Goyal

Farmtheory secures $1.45M seed funding from Merak Ventures to reduce food waste and boost farm yields

Blinkit empowers franchise owners with new app for streamlined operations

Lay’s teams up with David Beckham and Thierry Henry for epic ‘No Lay’s, No Game’ return, surprising 75,000 fans

Food delivery app surge leaves QSRs struggling with revenue and margins amidst fragmented sales: BNP Paribas Report

Luxury hotel chains in India expand branded residences amid rising demand from high-net-worth individuals