Pune based Mother’s Recipe (A part of Desai Brother’s Ltd. (DBL)- food division) has announced the acquisition of one of Kolkata’s trusted brand ELMAC (ElmacAgro Manufacturing Pvt Ltd ).
This alliance is valued at 1.9 times sales turnover which will help the group’s aim of capturing a larger market share in the Indian packaged food industry in the East.
“This deal will be a positive development for DBL- food division and is in line with our company’s vision to be a valued brand in Indian Packaged Food Space. ELMAC which has strong brand equity in the eastern region will help us strengthen our existing product portfolio and enable us in expanding our product categories. Plans of new product extensions under the Mother’s Recipe brand name which is already in process is expected to give us an additional growth of at least 25% in eastern region. In the next three years we are targeting a sales turnover of over INR 70 crores under ELMAC brand from the region,” shared Sanjay Desai, Executive Director, Desai Brothers Ltd. Cashing on ELMAC’s existing manufacturing and network, Mother’s Recipe to strengthen their reach and cater to the eastern region more effectively and efficiently, while expanding their product portfolio.
In the new setup the existing management will continue to look after the manufacturing & operations facilities, while Mother’s Recipe will manage the overall marketing, sales and distribution for the brandELMAC.Over a period of time, Mother’s Recipe looks at growing their volumes from Kolkata and the eastern region which currently contributes about 20% of theirdomestic sales.
DBL will further strengthen the ELMAC brand using its good brand re-call in the region.Desai Brothers will continue supplying products to ELMAC’s existing customers under their Private label brands, who will now stand to benefit from enhanced efficiencies of production, timely supply &stringent quality control. The company understands the potential of supplying quality products for private label and recognizes its businesspotential, hence will specifically focus on growing this part of the business with this strategic alliance.
In the Retail segment ELMAC products will focus on sauces & condiments andin the Food Service (HORECA) segment their well accepted sauces, condiments; canned Foods will augment the presence of Mother’s Recipe range of culinary products.
“The company is eyeing a growth of30% in the current financial year against a turnover of over INR 200Crore in 2014-15,” added Desai.
The company’s product expansion in RTC and RTE food segment comes at a time when the sector is emerging and growing extensively. A fast paced urban lifestyle, increasing prevalence of the nuclear family structure, rising disposable income and rising number of globetrotting Indians who are willing to experiment with food, are all favorable factors encouraging adoption of RTC/ RTE foods in India.