INDIA – Tata Consumer Products (TCPL), renowned for Tata Tea and Tetley, has successfully acquired two prominent Indian food groups, Capital Foods and Organic India, for a combined fee of Rs70bn (US$845m). 

The acquisition of Capital Foods is slated to occur in phases, with Tata Consumer set to acquire 75% of the shareholding before March 31, and the remaining 25% over the next three years, as disclosed in a late Friday evening exchange filing.  

Capital Foods, headquartered in Mumbai, is known for its popular “Desi Chinese foods” under the Ching’s Secret brand and Indian masala packs through the Smith & Jones brand.  

The estimated turnover for Capital Foods in the fiscal year 2023-24 ranges between Rs 750 crore (US$90.2M) and Rs 770 crore (US$92.6M), with a net worth of Rs 311.5 crore (US$37.5M) as of March 31, 2023. 

Sunil D’Souza, the MD and CEO of Tata Consumer Products, expressed enthusiasm about the strategic and financial fit with Capital Foods, stating, “We believe this is a good strategic and financial fit.”  

He highlighted the potential for market expansion in the fast-growing non-Indian cuisines segment, leveraging the established sales and distribution platform of TCPL.  

D’Souza emphasized the confidence in driving topline growth and realizing cost synergies, anticipating accelerated momentum and margin accretion for the business. 

Ajay Gupta, founder of Capital Foods, sees the collaboration as a significant leap with endless possibilities, stating, “Together, Tata and Capital Foods can create a multinational culinary brand that includes multiple food categories.” 

Simultaneously, TCPL is set to acquire Organic India, a supplier of supplements, herbal teas, ghee, and honey, for an upfront fee of Rs19bn. This acquisition includes an additional earnout for shareholders linked to the 2025-26 audited financials of the company.  

Organic India, founded in 1997, operates in more than 40 markets, with notable customers in the US such as Whole Foods Market and Sprouts Farmers Markets. 

D’Souza highlighted the strengths of Organic India’s differentiated products and robust supply chain, combined with Tata Consumer’s distribution prowess across channels in India and specific global geographies.  

He expressed confidence in accelerating momentum for the business and improving the overall margin profile. 

With iconic brands such as Tata Tea, Tetley, and Tata Salt under its umbrella, TCPL reported a revenue of Rs 13,783 crore in FY23.  

The acquisitions align with TCPL’s strategic vision to expand its product portfolio and tap into high-margin categories, marking a vital moment in the conglomerate’s growth trajectory. 

 

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