Indore-based spices and condiments brand Pushp has raised Rs 125 crore ($16.5 million) from A91 Partners, the private equity fund’s sixth investment since it was founded last year.
The capital infusion by the $350 million PE fund founded by former Sequoia India partners is the first institutional financing that the 45-year-old India-based family business has raised.
Pushp plans to use the money to expand its distribution network, bulk up its existing sales team, and drive marketing to strengthen its brand across India after being confined largely to Madhya Pradesh since inception.
The company clocked Rs 165 crore in sales in the previous financial year, with 70% of that coming from its home state.
After the funding round, A91 Partners is expected to own about 25% in the company.
A91 Partners’ bet on Pushp comes on the back of heightened interest by big PE firms like General Atlantic and strategic consumer goods firms in the overall spices and condiments segment.
Last month, diversified conglomerate ITC bought out Kolkata-based Sunrise Foods, while other big-name players in an otherwise largely unbranded industry, such as Eastern Condiments and Badshah Masala, have reportedly been in talks to sell stakes.
Most of these regional businesses are family owned but are now looking to raise external funds as they open up to the idea of bringing on board risk investors.
MDH Foods, Everest, Catch and Mother’s Recipe, and some new-age ones, are the other prominent national brands in the space.
Surendra Surana, cofounder of Pushp, said in a statement, “The Indian consumer is focused on taste, quality and reliability, and our sharp focus on these factors has helped us build deep trust with customers to become one of the top brands in the spices category. We are thrilled about the next phase of growth as we build Pushp into a leading spices brand in the country.”
Pushp is not looking to expand into other related categories for now.
“Usually, every region or state has a local leader in this segment. But we believe that Pushp, through its relentless focus on quality and product innovation, has the potential to go from being a local leader in Madhya Pradesh to being a significant national player,” said Abhay Pandey, partner at A91 Partners.