Orkla India, famed for its MTR and Eastern brands, is gearing up for acquisitions and leaning into the rapid meal and speedy delivery sectors to spur growth. CEO Sanjay Sharma envisions achieving double-digit revenue growth in the next few years.
This year has seen a surge in deal-making within India’s consumer goods and retail sectors, hitting a four-year peak from January to September. The food and beverage sector is spearheading this momentum, highlighted by Tilaknagar Industries’ impressive $486 million acquisition of the Imperial Blue whisky brand and Wilmar International's substantial $832 million investment in AWL Agri Business.
Sharma indicated that Orkla India is in active pursuit of mergers and acquisitions that resonate with local culinary traditions. The company is considering deals starting from 1 to 2 billion rupees ($11–22 million) and beyond. He noted that Orkla India possesses adequate cash reserves and can mobilize additional funds as necessary for future acquisitions.
After merging MTR and Eastern in 2023 under its Norwegian parent, Orkla, the company anticipates a return to its historical double-digit revenue growth by fiscal 2026 and beyond, having last reported such growth in fiscal 2023.
Emphasizing the growing reliance on convenience foods and digital avenues, Sharma revealed that online sales surged by 47% in the previous financial year, increasing their contribution to Orkla India’s domestic sales from 5.1% to 7.5%. Rapid delivery services like Blinkit, Zepto, and Swiggy Instamart have been instrumental, enabling consumers in urban areas to receive essentials within minutes.
The convenience foods segment, encompassing quick-preparation breakfast kits and vermicelli, now represents 33.4% of Orkla India’s revenue, a rise from 31.5% year-on-year. The spices segment continues to account for the remainder of the income.
Sharma also noted that the rising income levels among younger consumers and double-income households are set to bolster the convenience foods sector, potentially eclipsing the traditional spices segment. The company is optimistic that these trends, coupled with strategic acquisitions and robust e-commerce growth, will offer a competitive advantage in India’s swiftly evolving food market.
Orkla India’s focus on mergers, convenience offerings, and digital sales reflects changing consumer preferences in India. As it explores new avenues and embraces technology, the company seeks to bolster its market presence and expand its market share across the region.
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