Weikfield Foods can rotate ready-to-eat fusion to target young customers; planned acquisitions and IPOs
He said the company’s ready-to-eat cream cake was launched a few years ago and is gathering power and one of its first game-changing products.
“We are turning our business towards a strategic direction is to adopt more ready-to-eat formats because that’s what the younger generation prefers,” Malhotra said. “In the next few years, we plan to expand the ready-to-eat formats to our other desserts, whether in tetra paks or in cups, such as pudding and jelly.”
The company may turn to acquisitions to accelerate growth in the ready-to-eat market.
“We are looking to acquire brands. This has been on the anvil, and now our performance this year is even more exciting and we’re happy to evaluate good companies that can help us develop growth plans,” Malhotra said.
Growth space
Market intelligence provider Statista estimates that the upcoming feeding portion is expected to expand to $2.13 billion at a CAGR of 13.41% over the next four years. In November, Fireside and Thinking Forks Consulting said in a joint report that urban consumers were eating higher throughout the day, but in the controlled section, cooking aids, such as ready-to-eat and instant cooking products were selected.
Founded in 1956 by SP Malhotra and BR Malhotra, Weikfield, in Pune, was originally to bring global cuisine to India and introduce egg ust, corn flour and baking powder. Later, it diversified into jelly, mustard powder and chocolate and entered the breakfast section with oats.
“Weikfield is one of the older brands in the ready-to-eat market and can certainly ride the demand growth curve,” said Devangshu Dutta, CEO of consulting firm Third Eyesight. “It does lose the recent entrants that have been more aggressive in recent investments in marketing and distribution. But the market is far from saturated and growth can come from new products, even the launch of new brands, and maybe even inorganic through acquisitions.”
He added that changing lifestyles enhance the demand for convenience, as well as growth in supply, and growth in brands and products on supply-sides promotes growth in emerging and ready-to-eat markets in terms of modern retail channels supporting visibility in the category.
Weikfield plans to expand its scope with new products and flavors. It runs in five segments – desert blends such as cream sauce, jelly and faroda, baked products including baking soda, and beverages like green tea and hot chocolate. It also has a variety of pasta and condiments including Chinese sauces and tomato sauce.
In addition to the expansion plan, Wakefield has also evaluated public listings for the next three years, Malhotra said.
“We are looking at the IPO market and based on the valuation, we hope to be publicized by 2028. The listing will provide us with a platform to cash in part because we have been investing in the company for a long time, which will also allow us to raise funds for the company’s future expansion plans.”
Weikfield rejected several offers for private equity firms’ external funds. But Malhotra envisions that “supply chain and marketing require quite a bit of capital” and it plans to raise this through an IPO.
“Even for issuance, we need a different approach, because our current distributors are used to long-term shelf life products, but demand tends toward 30-60-day shelf life products. This is where we need to reinvent ourselves and need capital,” he said.
Merge exports
The company has three brands – Weikfield, products for indulgence and taste, Eco Valley for healthy products like organic green tea, and chef baskets for pasta and other baked goods.
It has three manufacturing facilities – Pune has two, one in Himaal Pradesh. One of the Pune factories offers the southern and western markets, while the Himaal factory caters to the north and east. Other Pune facilities produce mushrooms.
Wakefield is about 10% over ₹3 billion revenues from exports to the Middle East, Europe, the United States, the United Kingdom and Africa.
“We want to consolidate our business now and sell more products in certain countries than being too thin around the world. We would rather focus only on where we are today and continue to expand our sales there,” Malhotra said.
Unlike companies that released sales plummeted during the pandemic, Weikfield was one of the few to try to reverse the trend as consumers were indulged by lockdown restrictions, increasingly turning to baking and cooking.
But Wakefield’s sales have fallen as customers return to their pre-popular lifestyle and cannot maintain their growth trajectory. During this period, the company spent a lot of money on marketing and advertising.
It has since focused on profitability and consolidated its presence between geographic and specific products after it recovered.
In a report last year, the Nursing Rating said Weikfield is ready to benefit from experienced sponsors in the food processing sector, an established brand image and distribution network as well as a large number of product categories.
Fast business
Over the past year, the company has been bundled with fast business giants Zepto and Instamart after Amazon Fresh debuted. E-commerce is one of the company’s fastest growing channels, leveraging the same distributors for fast commerce to help save costs.
“We have 800 distributors across the country. No matter these Q-Com companies have dark stores anywhere, we have distributors or our own warehouses to serve our orders,” Malhotra explained.
Company revenue increased to ₹FY21.59 billion FY24 ₹2.953 million a year ago. Its profits have shrunk to ₹12 million ₹According to TRACXN data, it is 22 million.
Malhotra said the company’s revenue grew 18-20% in fiscal 25, while profits almost tripled.
