By Bindu D Menon
Cremica Foods is in talks to raise funds either through a public offer or via the private equity route to enter the snacks and ready-to-eat category, a senior executive said.
“We are in talks to raise funds as we want to enter the RTE category, while strengthening our existing product lines,” Akshay Bector, CMD, Cremica Foods told FE.
The company, which counts mayonnaise and sauces among its products, posted a revenue of Rs 320 crore for the year ended March 2023. Bector said the company expects to close this year with a turnover of Rs 400 crore. “Despite the challenges posed by the pandemic, our business has grown by 30% as more customers opted for food deliveries. The out-of-home consumption has been growing rapidly and this has given us a boost,” Bector said.
Bector said the company will be ramping up its production capabilities to meet the demand. “We are priced at a premium to most of our competitors. In spite of this, we see growth from both retail and institutional clients,” he said . He added it is also one of the key vendors for food industry players such as McDonald’s, Pizza Hut, Domino’s and Subway, among others.
The CMD said that 25 % of the company’s sales comes from the B2B segment. “We dominate the HoReCa (hotels, restaurants and Catering Segment) and work with almost all leading brands,” he said.
Cremica Foods had demerged from Mrs Bector’s Speciality Food in 2013.
The company said it would invest to scale up its existing manufacturing units. “Our mega food park has helped us reduce capital costs. The capacity is still under-utilised and we will be ramping it up to boost our production,” Bector said. Cremica has set up its food park in Himachal Pradesh.
“Since we already have the required infrastructure in place at our food park in Himachal Pradesh, we don’t necessarily need huge investments. In fact, CAPEX will be reduced further in the coming years,” said Bector. Currently, Cremica has two manufacturing facilities in Punjab and Himachal Pradesh.
The company also exports a few categories to the Middle East and Southeast Asian markets.
It competes with players such as Delmonte, Veeba, Dr Oetker and HUL-owned Kissan brand.
The mayonnaise market is estimated at Rs 2,000 crore while the ketchup market stands at Rs 3,000 crore, Bector said.
Speaking on the distribution of its products, he said that the company’s distribution focuses on smaller chains rather than modern retail outlets. “We are sold through 20,000 small retail outlets. We want to take it to two lakh outlets in the next three years. Our retail is still under-penetrated and we see a huge opportunity to grow,” he added.