Emami to invest Rs 400 crore in Bengal food park, eyes Agrotech IPO

Kolkata: Emami Group will invest around Rs 400 crore to set up a food park in West Bengal as it accelerates its entry into the packaged foods business. The company has sought 22 acres of land from the state government for the project, director Aditya Vardhan Agarwal said.

Also, on the cards is a new headquarters for which the group has sought 3-4 acres from the state in Kolkata so that it can consolidate operations in a single building which is now spread into multiple offices, he said.

The group’s edible oil arm, Emami Agrotech Ltd will set up the factory with the company having already expanded into staples such as atta, spices, besan, soya chunk and suji, and has just made a foray into western and traditional packaged snacks manufactured through its own and contract manufacturers located in multiple areas. The proposed factory will consolidate all manufacturing in one area.


“We will invest Rs 750 crore into the snacking business, including the factory. The business will also employ 4,000 people, both directly and indirectly. After snacks, we will enter into more food categories such as sweets and bakery products,” Agarwal told reporters here today.

Emami Agrotech, the group's Rs 20,000-crore edible oil business, is already EBITDA positive. The company plans to launch an initial public offering (IPO), with its expansion into packaged foods aimed at improving its valuation.

"We want to ensure the IPO is not only successful but also remains value-accretive for shareholders in the long run. Valuations for pure-play edible oil businesses are not attractive. Once the food business scales up and enhances the company's valuation, we will proceed with the listing," Agarwal said.

The group is also strengthening Emami Agrotech's leadership by hiring senior industry professionals, replicating the management model adopted at its flagship listed FMCG company, Emami Ltd. As part of this strategy, it has appointed Sanjay Singal as chief business officer of Emami Agrotech. Singal was previously chief executive officer of the Wagh Bakri Tea Group and chief operating officer of the foods business at ITC Ltd.

The group's third generation of promoters has also joined the business, marking the next phase of leadership transition.