Everstone Capital May Look To List Modern Foods
Modern Foods expects its revenue to reach Rs 1,000 crore by 2021.
Everstone Capital Advisors, which acquired Modern Food Enterprises Pvt. Ltd. from Hindustan Unilever Ltd. in 2016, plans to increase the bread-maker’s revenue by nearly four times to Rs 1,000 crore in the next five years, and prepare the group for a possible listing.
“I think at some point in time we will evaluate different options, an IPO will certainly be an option we will evaluate. It will be one of the many outcomes we will have,” Rajev Shukla, managing director, Everstone Capital Advisors, and a director on the board of Modern Foods, told BloombergQuint in an interaction.
The company plans to achieve the revenue target by working to increase its share in existing markets and also enter into new regions within India.
It currently has a distribution reach of approximately 100,000 outlets and plans to increase its distribution in key cities by 25-50 percent.
The company also plans to focus on cakes, rusks and buns in order to achieve Rs 1,000 crore turnover by 2021. Aseem Soni, chief executive officer of Modern Foods pegs the cakes and rusks market to reach Rs 5,000 crore over the next three to four years, and the bread maker plans to capture a high single digit market share in these two segments.
Shukla said that Modern Foods has a strong foothold in the southern, western and eastern parts of the country, and is now looking to increase its foothold in the north.
Post the relaunch, we’ve been growing in volume-terms at greater than 15 percent, in Cochin. Even in markets where we’re big, there is a lot of room for growth and certainly consolidating and strengthening our presence in those markets is a priority.Rajev Shukla, Managing Director, Everstone Capital Advisors
Modern Foods has recently rebranded itself and has launched a new advertising campaign.
In Mumbai and greater Mumbai, the bread maker currently has a market share of 15 percent and is the third largest bread maker, however, it plans to overtake Britannia Industries Ltd. and become the number two player over the next two quarters.
The private equity-backed company is also open to joint ventures, partnerships and even acquisitions to enter new categories. Everstone Capital is also not shy to invest in Modern Foods in order to help it achieve its revenue target of Rs 1,000 crore in the next five years, said Soni.