After the debilitating second Covid wave, consumer spending on restaurants has reverted to pre-Covid levels in cities where restrictions have been lifted
By Malini Bhupta
The pandemic and intermittent lockdowns have helped Massive Restaurants, a premium dining venture that operates brands like Masala Library, KODE, and Pa Pa Ya, discover the cloud kitchen opportunity.
After the debilitating second Covid wave, consumer spending on restaurants has reverted to pre-Covid levels in cities where restrictions have been lifted. Zorawar Kalra, promoter of Massive Restaurants, expects business over November and December to be the best in a decade.
Despite the return of consumers to restaurants, the cloud business remains a very lucrative opportunity for players like Massive Restaurants. Not surprising then that Kalra is looking to raise fresh capital as he looks to expand his cloud kitchen footprint across 10 new cities by the end of FY22. The company has already raised a couple of rounds of funding, with mid-market venture capital firm Gaja Capital having invested `160 crore in the last round. Earlier this month, Kalra’s rival Rebel Foods, a cloud kitchen chain, joined the unicorn club after it raised $175 million in a Series F round of funding, from some existing investors and Sovereign Wealth Fund of Qatar.
Early this year, the company launched two delivery brands called Louis Burger and Butter Delivery. Both brands have an average order value above`500 per order, while most other cloud kitchens tend to discount and enjoy much lower average order values. The company is now allocating more than 50% of its resources on its cloud business.
Massive Restaurants, which runs 32 fine dine restaurants across nine cities, is now looking to raise capital to further invest in the cloud kitchen business, as the unit economics are significantly higher in that business. Says Kalra, “The unit economics for cloud kitchens is very lucrative. Our sales from a 300 sq ft cloud kitchen is the same as it is from our 4000 sq ft restaurants, which is why we are allocating 50% of our resources to this side of the business.” The company is looking to launch six new brands that will include Jiggs Kalra Biryani, a pizza brand and gourmet north Indian cuisine brand for starters.