May 20, 2013, 08.00 AM | Source: CNBC-TV18
23-year old Aastha Gandhi, fifth generation of the Rs 350 crore Vadilal Group aims to expand 'melt in' to major metros by 2015.
The concept is about serving fresh gelato at the outlet itself as oppose to manufacturing it at a factory. Having already generated revenues of Rs 40 lakh in just two months of operation with one melt in parlour, Gandhi hopes to reach out to major metros by 2015. Young Turks got up with her to find out how she intends to refresh a century old brand.
From a soda fountain shop in Ahemdabad over a century ago to selling a range of ice-creams of 150 plus flavours sold in a variety of more than 250 pack and forms, Vadilal Industries today has emerged as India’s third largest ice-cream player and build supply 500 distributors and more than 40,000 retailers.
Following the footsteps of her great-great grandfather Vadilal Gandhi, who set up Vadilal’s first business and her father managing director Rakesh Gandhi, Aastha is the new kid on the block.
Aastha says, “I never wanted to join Vadilal because I was sick of ice-cream conversation on and in the table and everything.”
But she discovered her luck with the retail business while studying in Warwick University and decided to join Vadilal’s Happinezz ice-cream parlours as a general manager in 2012. Within a few months of working, she decided to take a course at Carpigiani Gelato University in Italy which turned out to be a turning point. Inspired by the art of Gelato making, Aastha took her first step towards creating a new brand and a new revenue stream for the group.
Aastha says, “Before I went to Italy for the Gelato course, my father made me promise that I am not going to come back saying I want to do Gelato because Gelato hasn’t been successful so far in India. But, when I came back, I explained the entire concept to him, I had to convince everyone on the board and not just my father.”
With the board backing her, Aastha launched melt in, in March 2013 in Ahmedabad. To ensure its smooth start she has been hands on and looked after all aspects of the operation.
With eye on quality, the Vadilal group invested Rs 2 crore to set-up an in-house Gelato lab and today 90 percent of ingredients used are imported. With the eye on drawing in the young upwardly customer, Aastha also roped in a French chef to put together a menu to align philosophy in creating a cool hang out. With revenues of Rs 40 lakh in two months of operations, Aastha believes she had a winning idea on her hands.
Aastha says,” melt in, as concept is all about freshly made Gelato. It is made right behind the counter, one can see how it is being made and the shelf life of our product is two days. It is all about freshness. It is a unique concept, even in Italy this is very new. Apart from Gelatos, we are also doing pastries and snacks and are trying to create a hang out place for youngsters here.
With 50 members team at melt in, is looking at 30 percent year-on-year growth and aims to expand to Mumbai, Delhi and Bangalore by 2015. Aastha says the biggest challenge in the coming years will be to maintain consistency of outlets and break-even.
Aastha says, “As of now there are challenges in terms of consistency of the product. Earlier, I was making the product, but I can’t continue that because I need to strategise all of that, training the staff, making short in doing everything. The product has to be upto my expectation by the end of the day and as of now, that is my biggest challenge.
While the family has given her the freedom to try her hand at running her own business, she doesn’t have access to group funding from hereon and melt in will have to fund for itself. Aastha has an eye firmly on turning profitable and living up to her family’s 100 year old business.
Vadilal Ind stock price
On February 05, 2016, Vadilal Industries closed at Rs 506.50, down Rs 11.25, or 2.17 percent. The 52-week high of the share was Rs 883.50 and the 52-week low was Rs 230.30.
The company's trailing 12-month (TTM) EPS was at Rs 17.48 per share as per the quarter ended September 2015. The stock's price-to-earnings (P/E) ratio was 28.98. The latest book value of the company is Rs 75.30 per share. At current value, the price-to-book value of the company is 6.73.
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