The firm logged a net profit of ₹4.5 crore in FY24, its first profitable year since inception in 2005.
“Last year was one of our best years so far. We did close to double-digit Ebitda [earnings before interest, taxes, and depreciation],” P.C. Musthafa, chairman and global chief executive of iD Fresh, said in an interview.
“We brought in several new levers, including expanding international business, which helped us deliver the best performance in the history of iD, Musthafa said.
He did not reveal exact financial figures as the company is yet to file its FY25 statements with the Registrar of Companies.
The firm also plans to list in public markets by the end of FY27, subject to market conditions, and is reportedly in talks to raise ₹500 crore through a secondary share sale.
iD Fresh’s push towards premium products reflects a broader change in the way companies, especially food brands, are tapping consumers. As consumers become increasingly health conscious, the willingness to spend more money on premium products is witnessing a rise.
Mint earlier reported on why private investors have been eyeing investments in better-for-you food and wellness products, specially those with a growing offline presence.
iD’s premium push
Bengaluru-based iD Fresh accelerated its shift toward premium products in FY25, launching more than 10 new items, including longer shelf-life, higher-price categories like spice blends, ready-to-heat sambhar, and chutneys. These new launches are expected to contribute 10% of the company’s overall revenue in the next two years.
“Our new products have started to contribute meaningfully to our overall revenue. Our internal target is that these categories will deliver 10% of the topline by FY27. We are on the path to make that happen,” Musthafa said.
iD Fresh reported a revenue of ₹557 crore in FY24, up from ₹479 crore in FY23.
Musthafa said introducing premium variants of existing products like idli-dosa batter and ready-to-heat paratha had helped boost profitability. For context, 750 gm of iD’s protein-rich idli-dosa batter is priced ₹159 while the regular batter costs ₹95 for 1 kg.
Premiumization is becoming a key driver of growth across consumer categories with players across the board looking to add differentiation and novelty at a higher price point.
The contribution of premium segments accounted for around 27% of total FMCG sales and contributed 42% of the sector’s value growth, according to an October 2024 report by NielsenIQ.
A larger number of companies in India are chasing growth to tap aspirational consumers by bringing global brands to India while adding premium categories such as body wash, sunscreens, serums, muesli and energy drinks to their portfolio.
Last month, Mint reported that Nestle India senses a premiumization opportunity as large as ₹7,500 crore to expand into new avenues like chocolates, coffee and even pet care.
Founded in 2005 by Musthafa and Abdul Naser, iD Fresh shot to fame on the back of growing demand for ready-to-cook products among young professionals who lived away from home and desired quick meals. It has raised upwards of $120 million from investors such as Premji Invest and New Quest Capital Partners since 2005.
The ready-to-eat market in India is expected to grow to $1,064 million between 2024 and 2027, according to estimates by market research firm Technavio. However, at least 80% of the packaged food market remains unorganized, presenting a viable opportunity for players like iD Fresh.
The category is tough to crack, given India’s love for fresh and home-cooked meals. Moreover, the convenience of ordering food online through Swiggy and Zomato has made these meal options an afterthought.
But with plans to replicate its idli-dosa batter playbook to other products, iD sees its products making a mark beyond south India as well, with Delhi among the frontrunners, Musthafa said.
Also Read: Hungry for growth, idli-dosa batter maker iD Fresh hunts for its next blockbuster product
Capacity building
The company’s investment in ramping up manufacturing capacity–both locally and internationally–reaped benefits in FY25, according to Musthafa.
Mint reported last year that iD Fresh is looking to set up four new manufacturing plants in Kerala, Tamil Nadu, West Bengal, and Andhra Pradesh by the end of the current financial year, in a bid to diversify its consumer base in smaller cities.
The company will invest up to ₹35 crore to set up a production plant in Saudi Arabia which is expected to be completed next year. Its new plant in Delhi, built at a similar investment figure, is expected to be commissioned in the next two months.
Though the success of its flagship product has created immense brand recall and loyalty for iD Fresh, it could be a challenge to recreate the popularity among its other brands, given the rising competition in the space by large and small players like ITC Foods, Tata Sampann, and Haldiram’s.