Indian multinational conglomerate, Indian Tobacco Company (ITC) is all set to acquire Kolkata based spice maker Sunrise Foods for an undisclosed amount to strengthen its spices portfolio and scale up its FMCG business in a profitable manner. The company has entered into a 100 % share purchase agreement of the equity share capital of Sunrise Foods Private Limited (SFPL). Acquiring Sunrise Foods will boost its share in the east and will be a step towards achieving the target of ₹ 1,00,000 crore revenue from its FMCG business by 2030.
The company’s press release said, “The proposed acquisition will augment the product portfolio and is aligned to ITC’s aspiration to significantly scale up its Spices business and expand its footprint across the country.”
“Over the years, the brand (Sunrise) has built a loyal consumer franchise, anchored on a differentiated product portfolio tailored to regional tastes and preferences, both in the basic and blended spice segments,” it added.
“The deep consumer connect and distribution strength of SFPL in the focus markets, together with synergies arising out of the sourcing and supply chain capabilities of the company’s agribusiness and its pan-India distribution network, will provide significant value creation opportunities for the company.”
Abneesh Roy, Senior Vice President of Institutional Equities Research, Edelweiss Securities said, “This is a positive development for ITC as among its diversified portfolio, we are most excited by ITC’s foods business because of synergy with its Agribusiness and strong understanding of Consumer taste due to its Hotel business.”
Presently, ITC makes Aashirvaad brand spices which are already market leaders in Telangana and Andhra Pradesh. It makes sense to purchase the market leader than to create an identity from scratch. He said, “Branded Spices is an exciting and high growth segment as Consumer shifts from unbranded to branded due to higher focus on safety, trust and quality.”