In a significant move, India’s largest ethnic snacks brand, Bikaji Foods, has acquired a 49% stake in BhujiaLalji, a Bikaner-based Indian snacks brand, in a deal valued at INR 5.1 Crores. According to the filings made by the listed food conglomerate, the deal includes 9,608 equity shares and 396 CCDs at an INR 5,100 value per security, with a face value of INR 10 per equity share.
BhujiaLalji Profile and Growth Potential
Founded in 2021 by Jai Agarwal, BhujiaLalji specializes in ready-to-eat baked and fried ethinic Indian snacks, including namkeen and bhelpuri, among others. The startup boasts an extensive portfolio of more than 14 products, with an impressive annual packaging capacity of 5,000 metric tonnes. Despite being just two years old, BhujiaLalji is already producing nearly 15% of Bikaji’s annual production, which amounts to 35,588 metric tonnes in FY23.
BhujiaLalji Market Presence and Financials
BhujiaLalji sells its products through dealerships across Rajasthan, Maharashtra, and West Bengal, and the brand also operates in online channels such as Amazon and Flipkart. In the financial year FY23, BhujiaLalji recorded a revenue of INR 18.08 Crores but reported a loss after tax amounting to INR 2.67 Crores.
Perspectives from the Founders
Regarding the acquisition, Jai Agarwal, the founder and promoter of BhujiaLalji, expressed gratitude for the support from a market leader like Bikaji, especially at this early stage of their journey. He sees the collaboration as an opportunity to expand the brand’s market base and reach new audiences through various channels.
Deepak Agarwal, the MD of Bikaji Foods, emphasized that BhujiaLalji will continue to operate independently, while its acquisition will contribute to enhancing the overall market position of the parent brand. The strategic location of the company in Bikaner will allow Bikaji to leverage the learnings from BhujiaLalji for accelerated growth and expansion.
Positive Market Response and Outlook for Snacktionary Business
The acquisition news has had a positive impact on Bikaji’s share price, which reached a 52-week high at INR 468.95 on the BSE, hitting the upper circuit. Furthermore, the share trade volume surged by more than 10 times during early hours of trading on the announcement day.
The Indian snacktionary business currently values at INR 4.24 lakh crores, with a revenue of INR 2.43 lakh crores, registering a Compound Annual Growth Rate (CAGR) of approximately 8.3% from FY15 to FY22. It is projected to grow at a CAGR of 8% over the next five years, reaching INR 5.8 lakh crores, as per a Frost & Sullivan report. Additionally, the Indian savoury snacks market is valued at INR 75,100 crores in 2022 and is anticipated to reach INR 1.22 lakh crores by 2026, exhibiting a CAGR of 13%.
