Bangalore-based MTR Foods, a 95-year-old food brand known for manufacturing a range of packaged foods including Dosa & Idli mixes among others, has set up (again) a ₹ 50 crore (~ US$7.14 Mn) seed fund to invest in startups that are engaged in food processing business, reported Economics Times.
It is to be noted that in August 2017, Orkla Group, the parent company of MTR Foods, had announced the launch of venture fund of same amount, i.e 50-crore, to make early-stage investments in startups. In the 2017 announcement, the Norway-based Orkla announced that fund is named as MTR Seed Fund and will invest mainly in food tech-related startups in India over 2017 and 2018. It was the first such fund set up by the Orkla Group outside of Scandinavia.
In May last year, MTR Foods made its first investment from its Rs 50 crore seed fund in early stage startup FirmRoots Pvt. Ltd., mainly for the latter’s children-packaged food brand Timios. Bangalore-based FirmRoots manufactures Apple And Cinnamon Twigs, Carrot And Cumin Sticks, Pinata Berry Bar, Tomato and Cheese Rings and many more.
Listed as a Fortune Next 500 (India’s Top Midsize) company for 2016, MTR Foods typically picks up a stake ranging between 26% and 49% in the startups. The portfolio startups gets access to MTR Foods research and discussion team as well as to the company’s in-house group of chefs or common services such as branding, legal assistance, treasury, and accounting services.
Established in 1924, by Yagnanarayana Maiya, as Mavalli Tiffin Room (commonly known as MTR), MTR Foods is a popular household name and boasts a strong pan India presence. It was in February 2007, when Orkla acquired MTR Foods Ltd in a deal worth $80 million (Rs 354.08 crore). The acquisition saw the exits of MTR Foods’ shareholders Aquarius and J.P. Morgan and the sale of the 40% stake held by MTR Foods’ Chairman and Managing Director Mr Sadananda Maiya.
“We clocked about Rs 900 crore in revenues in 2018, and is hoping to touch Rs 1,000 crore in 2019 as we are consistently been growing at 14 per cent CAGR for the past five years,” Sanjay Sharma, CEO of MTR Foods said.
“We started something like startup fund. The face of the Indian food processing industry is redefined by the startups. We want to now clearly participate in this market. We put together Rs 50 crore fund,” Sharma added.
Sharma further added that Telangana and Andhra Pradesh together contribute the second highest to the sales from India and, in 2019, the company has put together a strategy to focus on the two states both in terms of launch of new products as well as investments and strategic initiatives.