This summer India's red-hot Rs 9,000 crore organized restaurant business could see a couple of acquisitions, as leading domestic players look to consolidate and expand their menu offerings.
Leading domestic F&B entrepreneurs Anjan Chatterjee of Specialty Restaurants and Bhartias of Jubilant Foodworks are eyeing tuck-in acquisitions to enter new segments like cafes and confectionery to diversify. And so are a number of private equity investors who remain upbeat on the consumption story notwithstanding slowing consumer spends.
The promoters of two well known Bangalore-bred food and beverage brands, Sweet Chariot and Cafe Noir, which represent two ends of the price spectrum, are in talks to be part of the consolidation moves playing out in the sector. The 31-year-old bakery and confectionery maker, Sweet Chariot, has held early stage discussions with multiple F&B chains including Jubilant Foodworks, the master franchisee of Dominos International in India.
Retailing savouries at under Rs 25 and pastries at under Rs 40, Sweet Chariot has evolved as a household name in Bangalore with a footprint in Chennai, Hyderabad, Ooty and Pune.
"We have held discussions with many people, but nothing concrete has emerged yet," confirms Glen Williams, owner of Sweet Chariot. Williams added that in the event of a deal taking place, he would retain minority stake with a role to further grow the business.
Besides high-street eateries the brand also sports cafe formats, a segment that's gaining a lot of interest from F&B players in the premium segment.
Cafe Noir Restaurants, which offers customers a more luxury, French cafe experience, has had multiple rounds of discussions with Specialty Restaurants, said sources briefed on the matter. Cafe Noir could fetch a valuation of around Rs 15 crore, which is twice its annualized revenue.
While Anjan Chatterjee didn't wish to comment on the story, Chef Jean Michel, coowner of Cafe Noir, termed it as 'baseless rumours'.
Chatterjee said that Specialty Restaurants was looking to add niche segments such as a QSR format and a Cafe format to its existing portfolio of 10 homegrown brands.
The listed F&B major operates brands that include Mainland China, Oh! Calcutta , and Sigree with a pan-India presence.
AD Singh of Olive Bar and Kitchen, who raised capital from Aditya Birla Private Equity last year, is also eying the premium cafe space and is said to be in the process of rolling out a cafe /bistro in the National Capital Region.
Data shared by the National Restaurant Association of India pegs the Indian restaurant industry at Rs 43,000 crore, growing at a rate of 5 per cent to 6 per cent annually. The organized sector is about 20 per cent of the industry , growing at a more brisk 25 per cent.