Sequoia Capital Invests $30M In Indore’s Prakash Snacks

28 June, 2011

Sequoia Capital India has invested $30 million in Indore-based Prakash Snacks Pvt Ltd for an undisclosed stake in series A round of funding. Established in 2002, Prakash Snacks manufactures packaged food and snacks under the brand name Yellow Diamond. Its products include potato chips, puff biscuits, wafers, fruit juices and snacks.

The funds raised will be utilised for expanding manufacturing facilities and also for brand building.

“We believe that the snacks market is worth more than $1.5 billion and growing at 25-30 per cent every year. While there are many entrants in this space, there are only four or five serious players in the key sub-segments who have built a solid distribution network and supported the brands with a strong value proposition for customers. We genuinely believe that Prakash is one of the key players in this market, and can continue to scale up the business by building its distribution, strengthening its already strong brand proposition and expanding into multiple segments,” said VT Bharadwaj, MD of Sequoia Capital.

According to Bharadwaj, like any other consumer good category, there are many players who have entered or are planning to enter this space, since this is a fast-rowing category. However, given the immense scope, he believes that many players can emerge winners here.

“The company has been built brick by brick and has self-funded its growth through internal accruals. And it has been profitable from Day One. Now, the company wants to continue its strong growth trajectory by expanding into multiple segments, growing its geographic & distribution footprint and strengthening its brand proposition to customers,” added Bharadwaj.

Since its inception, Prakash Snacks has been witnessing a steady growth in terms of revenue and profit. Between FY’07 and FY10, the company’s revenue grew over fourfold to Rs 154 crore, according to VCCedge, the financial research platform of VCCircle. Incidentally, regional players in FMCG products have been growing pretty fast in India and across many categories – giving bigger rivals including top global firms a run for their money.

There had been deals of similar nature in the past. Last year, Motilal Oswal Private Equity Advisors picked up 22 per cent stake in Ludhiana-based Rs 500 crore Cremica Foods, which makes biscuits, condiments and sauces, and supplies to McDonald’s, Pizza Hut and Cafe Coffee Day.

Sequoia Capital has been making bets on India’s domestic consumption story through its investments in companies like kitchen appliances firm Stovekraft Pvt Ltd, whose flagship brands are Gilma and Pigeon; Genesis Colors, which owns premium Indian fashion labels like Satya Paul and Bw!tch; FMCG firm Paras Pharmaceuticals and most recently, Lovable Lingerie.

Leave Your Comment
Exclusive: Snacks maker Chhajed Foods raises venture funding

Exclusive: Snacks maker Chhajed Foods raises venture funding

Joseph Rai 2 months ago
Snacks maker Chhajed Foods Pvt. Ltd has secured funding from a venture capital firm for expansion, people directly familiar with the development said. The Ahmedabad-based...
PE-backed Yellow Diamond chips maker Prataap Snacks gets SEBI nod for IPO

PE-backed Yellow Diamond chips maker Prataap Snacks gets SEBI nod for IPO

TEAM VCC 4 months ago
Prataap Snacks Ltd, the maker of Yellow Diamond Chips, has received capital market regulator SEBI’s approval to float its initial public offering. The Indore-based company,...
WestBridge Capital takes big bite of 'Crax' maker DFM Foods for over $10M

WestBridge Capital takes big bite of ‘Crax’ maker DFM Foods for over $10M

Madhav A Chanchani 4 years ago
WestBridge Capital Partners has picked up nearly 25 per cent stake in DFM Foods, the maker of salted snacks under the ‘Crax’ brand from its...
No Comments

Sequoia Capital Invests $30M In Indore’s Prakash Snacks

Powered by VIP