A growing focus on ingredient labels, nutritional value and minimally processed food has prompted retail veteran Arvind Mediratta to make a fresh bet on India’s grocery market, where competition has largely centred on assortment, pricing and delivery speed.
Arvind Mediratta, former chief executive of Metro Cash & Carry India and a former Walmart executive, will launch FreshTerra, a food retail chain under Elixiir Foods, on Friday, saying the business is built around a shift in consumer preferences towards cleaner and healthier food choices. The startup, co-founded with Ambuj Narayan, former CEO of Taneira, will open its first store in Gurugram and plans to expand to 12-15 stores across Delhi-NCR by FY28 through an omnichannel model combining neighbourhood stores with its own delivery platform.
The parent company, Elixiir Foods, raised $9 million in seed funding from 3one4 Capital and Incubate Fund Asia in February this year. Speaking to FE, Mediratta said the capital would be deployed towards store expansion, technology, warehousing, supply chain infrastructure and a central kitchen. He added that the company has sufficient capital to fund operations for at least the next 18 months before considering another fundraising round.
Mediratta said he expects rising incomes to reshape buying behaviour, arguing that consumers begin paying greater attention to ingredients and nutritional content once they cross a certain income threshold. “We want to change the conversation from 10-minute delivery and lowest prices to high-quality food at affordable prices,” he said.
That thinking has shaped the company’s retail strategy. FreshTerra will sell fresh and gourmet food products while excluding categories such as personal care and household essentials that typically occupy supermarket shelves. Instead, it will focus on healthier staples, edible oils, fresh produce, dairy and meat—what the company calls “centre-of-the-plate” categories—while steadily expanding its private-label portfolio.
The retailer currently stocks around 2,800 SKUs, of which roughly 1,000 are private-label products, a share it plans to increase over time. Mediratta said products stocked by the retailer are screened against internal quality parameters before reaching store shelves.
The initial focus is on households with annual incomes of more than ₹12 lakh, a segment Mediratta believes is increasingly willing to pay for better-quality food while remaining value-conscious. Stores will be located in high-density residential catchments and malls across Delhi-NCR. Rather than expanding rapidly across cities, the company plans to first build density within the region, with five stores and five cafés targeted by the end of FY27. Gurugram, Noida and other NCR markets will form the first expansion cluster before the company evaluates markets such as Bengaluru and Hyderabad. According to Mediratta, clustering stores within one geography will improve procurement, logistics and supply chain efficiencies before a wider rollout.
Orders placed through the company’s app will be fulfilled from physical stores rather than dedicated dark stores, reflecting its strategy of using stores as both retail and fulfilment centres. Mediratta argued that physical stores remain central to the model as they allow customers to sample products and experience offerings such as freshly milled flour, ground spices and cold-pressed oils before shifting to repeat online purchases.
On keeping prices affordable over the long term, Mediratta said, “As we scale, our sourcing costs improve, we negotiate better with suppliers and operating efficiencies kick in. We are not looking to maximise margins per product; we are looking to build a large, profitable business through volumes and disciplined cost management.”