PepsiCo joins race to acquire stake in Haldiram, talks underway
What's the story
PepsiCo, the multinational food and beverage corporation, has initiated talks to buy a minority stake in Haldiram Snacks Food, India's top ethnic snacks company.
According to The Economic Times, the talks are being held directly between PepsiCo's New York-based leadership and the Aggarwal family, which owns Haldiram.
The move makes PepsiCo a new player in a race that already has global investment firms Temasek and Alpha Wave Global.
Valuation expectations
Aggarwal family seeks high valuation for Haldiram
Reportedly, the Aggarwal family is looking for a valuation of ₹85,000-90,000 crore for Haldiram as they consider an external investor for the first time.
This comes as Temasek and Alpha Wave Global have already made binding offers for a 10-15% stake in the company.
The talks are still at a nascent stage and may not lead to a deal.
Market leadership
Haldiram's market dominance and potential investment
Haldiram rules the ethnic snacks segment with more than 500 varieties of products ranging from namkeen, sweets, ready-to-eat meals, and pre-mixed food items.
The company earned ₹12,800 crore in revenue in FY24.
This is more than double of PepsiCo's Indian snacks business which made ₹4,763.29 crore in the nine-month period between April and December 2023.
Reports indicate Temasek's investment could be over $1 billion.
Market expansion
PepsiCo's strategic move to tap into ethnic snacks market
PepsiCo, which dominates the western snacks market with brands such as Lay's, Kurkure, and Doritos, views this potential acquisition as a way to establish itself in the fast-growing ethnic snacks category.
Despite a 24% market share in western snacks, PepsiCo has a minimal presence in traditional Indian snacks such as namkeen and bhujiya.
The Indian snack market is expected to grow from ₹42,694.9 crore in 2023 to ₹95,521.8 crore by 2032, IMARC Group said.