Mid-market private equity firm Peepul Capital is looking to divest its stake in Unibic Foods India, an Indian branch of Australian premium cookie manufacturer Unibic Biscuits.
Peepul has engaged Avendus Capital to explore options for selling a part of its stake or its entire stake in the firm, two people in the know said.
One of the two people said private equity firms have been approached.
Avendus Capital declined to comment. Unibic and Peepul Capital’s co-founder Sandeep Reddy did not respond to multiple requests for comment.
Unibic Foods posted operating income of ₹596 crore in FY22. Its profit after tax was at ₹10.8 crore, according to a 22 December report by ratings agency ICRA Ltd.
It reported revenues of ₹439 crore in the first seven months FY23, up 32% from a year ago.
“It factors in a steady improvement in the business and financial risk profiles of the company, supported by healthy profitable ramp-up of operations, and increased focus on its premium products. The company reported a steady performance in FY22, with growth of 9.9% in operating income and operating margin of 3.9% vis-à-vis the previous year’s growth of 23.8%,” the report said.
Unibic Foods was set up by Nikhil Sen, former chief operating officer of Britannia, Unibic Australia’s Michael Quinn and Dhruv Deepak Saxena in 2004 in Bengaluru.
In 2007, Lighthouse bought a 25% stake in the company for around ₹20 crore.
Peepul Capital acquired a majority stake in the firm for around ₹100 crore in 2012.
Unibic Foods became a fully Indian entity in 2012, following investments from Peepul Capital.
Sen assumed the role of its managing director.
Following Sen’s passing in 2019, Unibic appointed Srini Vudayagiri as the director.
At that time, Vudayagiri was also a partner at Peepul Capital. Subsequently, he assumed control of the packaged foods company in 2019.
In 2021, Naveen Pandey was named chief executive officer. Vudayagiri has since parted ways with Peepul Capital.
Unibic primarily operates in the premium cookie market. It also sells cream wafers. However, players such as Britannia Ltd, Parle and ITC dominate India’s ₹40,000 crore market.
The Indian market is crowded with players selling glucose, marie and milk biscuits apart from crackers.
“The company faces stiff competition from local and regional, as well as national players as the market remains fragmented. In biscuits segment, competition remains high as the company faces stiff competition from established brands like Britannia, Anmol Industries, Mondelez, Parle and ITC among others, given its focus on the mid-premium and premium categories, “ the ICRA report said.
Unibic also undertakes private label manufacturing for Indigo Airlines and other companies. It also exports its products to several overseas markets. Unibic has a manufacturing facility in Bengaluru.