By Kritika Arora
After announcing its foray into the FMCG business, Reliance Retail is working on an aggressive plan to build a strong portfolio in the space with a host of acquisitions of popular brands. Industry and trade sources told FE that the company is in talks to acquire popular spice maker Mahashian Di Hatti (MDH). Besides, it is also eyeing one of the biggest spice makers of Tamil Nadu, Aachi Masala. The company has made investments in Tamil Nadu’s Udhaya Krishna Ghee and may enter into a deal with it.
Trade sources observed that acquisition of these brands would provide the necessary impetus to Reliance Retail for its FMCG play. For instance, MDH is one of the largest spice makers in the country and commands a significant presence in north India. It sells over 60 products in the country and has a network of 1,000 stockists and thousands of dealers. The company can produce 30 tonne of spices in a day, according to its website. Similarly, Aachi Masala has around 3,000 distributors.
When contacted, a Reliance Retail spokesperson said, “As a policy, we do not comment on media speculation and rumours. Our company evaluates various opportunities on an ongoing basis. We have made and will continue to make necessary disclosures in compliance with our obligations under the Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015 and our agreements with the stock exchanges.” The target companies could not be independently reached for comments.
A couple of days after the announcement of the FMCG foray, there were reports that Reliance Retail has acquired beverage brand Campa Cola from Pure Drinks and beauty products brand Insight Cosmetics.
There were also reports about the company being in talks with Bindu Beverages.
At the company’s 45th annual general meeting on August 29, Isha Ambani, daughter of Reliance Industries chairman Mukesh Ambani, who leads the retail business and is a director on the board of the company, announced the FMCG foray: “The objective of this business is to develop and deliver high quality, affordable products which solve every Indian’s daily needs”.
The company already has its own brands in categories of staples, home, personal care and general merchandise and with this foray, it will compete, inter alia, with majors Hindustan Unilever, Dabur, Nestle and Marico.