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Orkla India, owned by Norwegian investment firm Orkla, is considering an initial public offering (IPO) for its Indian unit, which includes the well-known spices and condiments brands MTR and Eastern. Nils Selte, Orkla's president and CEO, informed investors that the company has initiated an IPO readiness study, which yielded positive results.
However, any final decision on accessing the capital markets in India is not expected until sometime in 2025. Selte emphasized that there is still a lot of preparation needed before proceeding.
Based in Mumbai, Orkla India recorded sales of ₹2,300 crore last year, with 70% of its revenue coming from spices and masalas. In a strategic move, Orkla restructured its Indian operations under Orkla India, consolidating MTR, Eastern, and international business units to enhance growth.
Orkla entered the Indian market in 2007 by acquiring MTR Foods and later acquired a majority stake in Kerala-based Eastern Condiments nearly four years ago. The Indian spices market is valued at over ₹90,000 crore, with only one-third being branded.
Within this organized sector, Everest leads, followed by MDH. MTR, DS Foods, Ramdev, and Eastern are strong players in specific regions, but competition is increasing as more FMCG companies enter the spices and ready-to-cook segments.
Orkla Foods Europe CEO Atle Vidar Nagel Johansen highlighted the complexity and competitive intensity of the Indian market compared to European countries. The diverse regional food preferences in India make it a challenging market to navigate. Despite this, Orkla categorizes India as a "grow and build" market, indicating strong potential for expansion.
With a net profit of ₹340 crore and a low double-digit growth rate, analysts believe Orkla India could achieve a valuation between ₹15,000 crore and ₹20,000 crore. The strong brand recognition, especially in southern India, supports this optimistic valuation.
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