 "Haldiram")
Haldiram's has been making headlines as reports of interest from major private equity firms like Blackstone, Bain Capital, and Singapore's Temasek emerge. The brand, which began as a modest sweet shop in Bikaner, Rajasthan, boasts a substantial market presence, with a combined revenue nearing Rs 9,000 crore and products available in over seven million global outlets. As the snack giant denies reports of Haldiram's stake acquisition, here is a closer examination of the brand, its history, sales interest, and global expansion.
Potential sale and foreign investment in Haldiram's
Exploring the sale rumours
Amid increasing interest from private equity (PE) firms, Haldiram's Snacks Food Pvt Ltd's promoters have expressed reluctance to sell the company despite receiving non-binding offers.
As Business Standard earlier reported, in the PE industry, US-based Blackstone and a consortium led by Bain Capital and Singapore's Temasek have made separate offers to acquire the popular snack food company.
However, a banking source revealed that the promoter family is not enthused by the reported valuation of $8.3 billion (Rs 69,138 crore).
Haldiram's officials have categorically denied any intentions to sell the company, stating, "All this news about the promoters selling out is not true."
Despite the promoter's reluctance, the interest from major PE firms highlights Haldiram's strong market position and growth potential. The company, known for its wide range of Indian snacks, has a significant presence in international markets, including Singapore and the United States and operates approximately 150 restaurants.
Global investors' interest
Big players eyeing Haldiram's
On May 14, reports emerged that Blackstone in partnership with Abu Dhabi Investment Authority (ADIA) and GIC, aimed to bid for stake acquisition of up to 76 per cent of Haldiram's Snacks Food Pvt Ltd.
Blackstone, one of the four largest publicly traded private equity firms, manages over $1 trillion in assets across various industries globally. Founded by Stephen A. Schwarzman, who also serves as Chairman and CEO, Blackstone has a formidable reputation in the investment community. Meanwhile, ADIA, founded in 1976, invests globally on behalf of the Government of Abu Dhabi, intending to generate long-term value.
However, Bain Capital, which manages approximately $185 billion in assets, and Temasek, with a portfolio valued at 403 billion Singapore dollars, are also now competing with this consortium. The two firms submitted a non-binding offer valuing Haldiram's at $8-8.5 billion (Rs 66,400-70,500 crore).
This bid marks the first collaboration between Bain and Temasek in India. Historically, Bain has frequently partnered with GIC for co-investments.
Temasek is a limited partner in Bain's global funds, as are ADIA and GIC. In November last year, Bain closed its fifth pan-Asia private equity fund at $7.1 billion, surpassing its target by 40 per cent.
Bain initially discussed a potential minority investment with the Agarwal family. Towards the end of 2023, these discussions included factory visits and management meetings as the family finalised a pan-India restructuring plan.
Tata Consumer Products denies $10 billion Haldiram stake talks
Back in September, Tata Consumer was reported to be in talks to buy the stake in Haldiram, a move that would have significantly expanded Tata's consumer product portfolio. According to a report by Reuters, Tata Consumer was in negotiations to acquire a 51 per cent stake in Haldiram's Snacks Food Pvt Ltd for $10 billion (Rs 83,300 crore), a valuation which the company found too high given Haldiram's annual revenue of approximately $1.5 billion.
In response to the report, Tata Consumer Products issued a regulatory filing categorically denying any current negotiations with Haldiram.
"The Company is not in negotiations as reported in the above-referred news article... We are not aware of any information that has not been announced to the Exchanges, which requires disclosures under Regulation 30 of the SEBI (LODR) Regulations, 2015," the company stated.
At the time, Reuters had also reported that Haldiram's promoters were discussing selling an additional 10 per cent stake to Bain Capital last year ahead of a potential stock market listing. This deal, too, did not materialise.
Legacy of Ganga Bishan Agarwal
Small sweet shop to snack giant: The story of Haldiram's
Starting as a small sweet shop in Rajasthan's Bikaner, Haldiram's has grown into an internationally renowned company, transforming the perception of traditional Indian snacks and sweets.
At 12, Ganga Bishan Agarwal, affectionately known as Haldiram Ji, was engrossed in his father's bhujia business. Bikaner was already known for bhujia, a savoury snack made from chickpea flour (besan). However, young Haldiram envisioned a unique twist to the traditional bhujia—a thinner version made from moth flour instead of besan.
In 1919, Haldiram's venture in his father's small shop became an instant success. In 1937, Haldiram's was established as a retail sweets and namkeen shop. His moth flour bhujia's unique flavour and texture struck a chord with the people of Bikaner, laying the foundation for a business empire that would eventually generate a combined revenue of about Rs 9,000 crore.
Haldiram had three sons: Moolchand, Satyanarayan, and Rameshwarlal. Moolchand's sons and their sister Saraswati Devi continued the family legacy, propelling the business to bigger heights.
In the 1950s, Ganga Bishan Agarwal and his sons Satyanarayan and Rameshwarlal moved to Kolkata and established the brand "Haldiram Bhujiawala." Haldiram's eldest grandson, Shiv Kishan, also joined them in this venture. Meanwhile, the younger sons ran the original Bikaner shop, and the Kolkata business expanded rapidly, moving beyond traditional bhujia. It later expanded to New Delhi in 1983.
Haldiram's became famous for its delightful range of namkeens, including bhujia, sev, and various traditional sweets. The consistent quality and flavour of Haldiram's products swiftly earned the trust and loyalty of consumers across India.
The company's savoury snacks crossed the $1 billion mark in sales in the calendar year 2018.
Haldiram's manufacturing and distribution network
Behind the scenes
Haldiram's offers a range of products under various brand names, including Haldiram's, Haldiram's Prabhuji, Bikanervala, Bhikharam Chandamal, Bikaji, and Bikano.
The company has manufacturing plants in locations such as Nagpur, New Delhi, Gurgaon, Hooghly, Rudrapur, and Noida.
Haldiram's also operates its own retail chain stores and restaurants in cities like Pune, Nagpur, Raipur, Kolkata, Noida, Gurgaon, and Delhi.
In 1993, the United States became the first country Haldiram's began exporting to, due to the large Indian population residing there.
In 2016, Haldiram's established its first overseas factory in the UK, which exports to countries including Canada, the UK, Europe, Australia, New Zealand, the Far East, the Middle East, Moscow, Japan, Sri Lanka, Nepal, and Thailand, among other markets.
Haldiram's runs all its distributors directly, with none being franchised. The company operates on three models: kiosks, quick-service restaurants, and casual dining. Depending on the model, setting up can cost between Rs 1 crore and Rs 4 crore. There is also a nine-year agreement for distributors, who must pay a 2.5 per cent royalty fee per year, according to haldiramsdealership.com.
Haldiram has a widespread network of 1,000 distributors in India, and its products are available in more than 7 million outlets.
Last year, Business Standard reported that Haldiram's is looking to expand its footprint and is considering an initial public offering (IPO). Noida's Haldiram's Snacks and Haldiram's Nagpur are in the process of merging, with plans to invest Rs 2,000 crore to Rs 2,500 crore to expand capacity over the next five years.
