iD Fresh Food raises Rs 507 crore led by NewQuest Capital Partners

PC Musthafa, CEO and co-founder, iD Fresh Food

Foods products company iD Fresh Food said on January 4 it has raised Rs 507 crore funding in Series D round, led by private equity platform NewQuest Capital Partners along with its existing investor Premji Invest and others. The current round also saw the exit of one of its earlier investors Helion Ventures, which exited the company with a 10X return on its investment made seven years ago.

Flush with funds, the company has big plans going ahead as it builds capacity by launching production units across several locations, while also introducing new products.

“We are setting up a large factory in Hyderabad and a reasonably good factory in Delhi also. Besides this, we plan to start distributing parotta in the US and the UK market,” the company’s CEO and co-founder PC Musthafa told Moneycontrol.

“The Middle East is a large market for us and we will continue our expansion in the region,” he added.

The company’s production unit in Bangalore produces over 1 lakh kilogram of batter per day and its upcoming factories in Hyderabad and Delhi would have a third of this capacity initially.

iD Fresh Food is also looking at strengthening its foothold in other regions in the country besides South India and will soon be launching operations in Kolkata. The company will introduce two new varieties of ‘parottas’ as it eyes a larger share in non-Southern markets. According to Musthafa, iD Fresh is now generating over Rs 1 crore in revenue from Delhi.

“We are going to invest heavily in developing these two markets along with international regions for the next two years,” he said.

Besides this, the company is also planning to launch its initial public offer (IPO) in the next three-four years. According to the company’s chief financial officer Jaipal Singal, the current investment round has happened with a commitment towards IPO, and iD Fresh Food is structuring the team as it gears up for the public issue.

Founded by PC Musthafa, Abdul Naser and his brothers in 2005, iD Fresh Food had secured $5.2 million in Series A funding from Helion Ventures in 2014 and $25 million from Premji Invest in 2017.

iD Fresh Foods has witnessed rapid growth since its inception and according to the company, it is on track to achieve Rs 500 crore in revenue (run-rate) for the current fiscal year. Last year, the company launched the world’s largest idli-dosa factory at Anekal in Karnataka with a capex of close to Rs 50 crore. Its fully automated Giant Kitchen produces over one lakh kg batter and three lakh parottas per day.