Orkla, the Norwegian industrial investment company, is exploring the possibility of launching an initial public offering by 2025 for its Indian unit, which owns spices and condiments brands MTR and Eastern, according to its country head.
Besides, the company is expanding its global sales targeting the growing Indian diaspora abroad and expects its international business to contribute 20 per cent in 2024, Orkla India CEO Sanjay Sharma said.
Moreover, it is also expanding its play in the food market by entering into cold chain-based food products such as ‘idli’ batter and also entering into regional delicacies.
This happened in late June and July, when there is summer holidays, as far as Europe is concerned.
“So this is some work that we will start to do now. As indicated in the statement given by the board, if at all we were to take a decision to do something, is to be expected it will only be by 2025,” said Sharma on the sidelines of World Food India Summit organised by Ficci here.
In 2007, the Norwegian industrial investment company Orkla ASA acquired MTR Foods, a packaged foods company based in Bengaluru, India, for $80 million.
The company has a revenue of around Rs 2,300 crore in which its MTR brand contributes 48 per cent while 34 per cent comes from Eastern and the remaining from the international market. The company has achieved around 12-13 per cent growth.
Orkla India also expects good growth coming during the festive season, which has already started from the South with the Onam festival. It is encouraged with a “good run” from its Kerala markets.
“The current year has been a little bit of a challenging year thanks to the consumption drop that we had, coupled with the very high level of food inflation…But we do see that food inflation is starting to slow down. Last quarter, the consumption jumped up from 4 per cent to 7 per cent but we have not yet seen the impact of that in the market. So we are hoping that, you know, we will have a very good festival season,” Sharma said.
The company will be focusing on selling its gulab jamuns and the ready-to-eat sweets portfolio that it has just launched in the market.
“MTR is a food company and it needs to continue to develop and expand that into other food categories, for example in the sweet category, we were only in the mixes portfolio, so we wanted to expand our footprint into the ready-to-eat sweets portfolio. We have come out with a whole range of sweets from Karnataka,” he said.
Moreover, as the market for cold chain-based food products is picking up with a rise in discretionary income, where people want to consume fresh food, it has entered into idli and dosa batter and also launched ‘Malabar Parota’.
Besides, the company which acquired Eastern brand in 2021, aims to upgrade it into a food company.
“Presently, 90 per cent of the portfolio comes out of spices and condiments” and the company aims to evolve Eastern to make it a food company, he said.
On its international presence, Sharma said its products are available in about 42 markets across the world.
“We are now focusing on nine markets where we are going to focus and going to build this business over there out,” he said, adding that in its international market, MTR focuses on South Indian diaspora, while Eastern is into Malayali diaspora and Rasoi Magic is targeting Punjabi and Gujarati diasporas.
He further added: “Exports roughly contribute 18 per cent of our total business. But given the higher growth trajectory of exports, I think it’s expected to become roughly 20 per cent of our business.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
First Published: Sep 19 2024 | 8:18 PM IST
