Indian condiment maker Cremica is preparing for an initial public offering (IPO) of ₹500 crore to ₹1,000 crore, as the company looks to raise capital for acquisitions, manufacturing expansion and international growth.
The company expects to begin preparations for the public issue in the coming quarter and is targeting a stock market debut next year, according to Akshay Bector, Chairman and Managing Director, Cremica.
“We are likely to start our endeavours in the coming quarter and hopefully be in the market by next year. The IPO will be ₹500 crore to ₹1,000 crore in size,” Bector said.
Cremica expects to close the current financial year with a turnover of around ₹450 crore and EBITDA of ₹65-70 crore. Revenue is projected to grow by about 20% by the end of the next financial year, while EBITDA is expected to reach around ₹120 crore.
IPO to support acquisitions and capacity expansion
Bector said the company plans to consider acquisitions after listing, alongside investments in manufacturing capacity and geographical expansion.
“We are at a very interesting part in the journey. We are extremely well positioned for exports,” he said.
Cremica currently operates two manufacturing plants in Punjab and Himachal Pradesh and plans to add manufacturing facilities in other geographies over the next year.
The expansion is expected to strengthen the company’s national distribution network while supporting exports by locating production closer to ports.
Cremica has installed capacity to manufacture 6,000-8,000 tonnes of liquid condiments a month, translating to nearly 100,000 tonnes annually. Bector said international customer relationships could require significantly higher investments in the coming years.
UK entry through HoReCa
International expansion is also emerging as a key part of Cremica’s next phase of growth. The company is preparing to enter the UK HoReCa market in December with its ketchup and mayonnaise products.
Cremica has partnered with a leading UK distribution house for the launch and expects the India-UK free trade agreement to support its international expansion.
The company is initially focusing on institutional and food-service customers rather than the UK retail market.
“We have always benchmarked our products internationally. For us to meet the exact standards of the UK market is a matter of routine,” Bector said, adding that the UK entry could create opportunities in other international markets.
Cremica is also exploring opportunities in other geographies and looking at ways to extend its relationships with Indian quick-service restaurant (QSR) customers into overseas markets.
The company is celebrating 30 years of its association with McDonald’s India, while continuing to build its presence across the food-service sector.
Tier-2 and tier-3 cities drive domestic growth
While exports are becoming an increasingly important growth avenue, Cremica is also seeing strong demand from India’s tier-2 and tier-3 cities, where packaged condiment consumption is expanding beyond the country’s larger urban centres.
Bector said the next phase of growth would increasingly come from value-added foods within the company’s existing categories.
He also called for clearer regulatory standards for products such as ketchup and mayonnaise. According to Bector, greater clarity around parameters such as tomato content in ketchup and oil content in mayonnaise could help establish more consistent product standards and enable consumers and food-service operators to distinguish between products.
He also called for greater disclosure when food-service operators use product analogues.
Opera snacks target premium segment
Alongside its core condiment business, Cremica is expanding its Opera snack-food brand through institutional partnerships with café chains, QSRs, hotels and airlines.
The brand already has partnerships with companies including Tim Hortons, Subway and IndiGo.
Cremica expects Opera to generate around ₹50 crore in revenue within three years, with the company targeting a national presence in the premium segment.
With the proposed IPO, new manufacturing capacity, acquisitions and international expansion, Cremica is now looking to build on its established condiment and food-service business while expanding into value-added foods and overseas markets.