Orkla India Limited IPO

30 Oct 2025 , 10:41 AM

Orkla India Limited (formerly MTR Foods Private Limited) is a leading Indian manufacturer of food ingredients and ready-to-eat products. The ~100-year-old company has been a part of Norway’s Orkla group since 2007. The company’s IPO is an offer for sale to provide liquidity to its existing investors.

Offer Details of the IPO

• Total Offer Size – INR 1,667.5 crore. The issue comprises an offer for sale of up to 22,843,004 equity shares.
• The following existing investors are selling their shares:
• Orkla Asia Pacific Pte. Ltd. – up to 20,560,768 shares
• Navas Meeran – up to 1,141,118 shares
• Feroz Meeran – up to 1,141,118 shares

Price Band: INR 695 to INR 730 per Equity Share

Book‑Running Lead Managers      

• ICICI Securities Limited
• P. Morgan India Private Limited
• Kotak Mahindra Capital Company Limited
• Citigroup Global Markets India Private Limited

 

Indian Convenience-Food Market Overview

The Indian convenience-food market is a small, fast-growing subset of the larger packaged‑food business. It is fueled by increasing disposable incomes, accelerating urbanisation, growth of e-commerce/quick-commerce channels and strong consumer desire for time-saving meal solutions. The market is typically divided into three major segments.

Table: Key Segments

Segment	Definition	Core Offerings (examples)	Share of the convenience‑food market (FY 24)
Ready‑to‑Eat (RTE)	Meals that are fully-cooked and need only to be warmed or mixed before being eaten.	Side dishes for meals, like curries, as well as liquid and solid beverages (e.g., badam-milk/lassi) and ready-to-eat desserts.	11 %
Ready‑to‑Cook (RTC)	Pre-portioned, pre-mixed ingredients that require little advanced preparation (typically a few minutes of cooking).	Breakfast mixes, Cold wet batter(IDLI/DOSA) and dessert mixes.	28 %
Frozen Foods	Pre-fried, pre-cooked and/or marinated products frozen for shelf life and to be heat-treated before serving (fry, bake or grill).	Frozen food suitable for frying, marinated or smoked meats/vegetables, frozen meals that can be heated quickly.	61 %

Source: RHP

 

Table: Growth Profile (Past vs. Future)

Segment	Past CAGR* (FY 20‑24)	Projected CAGR† (FY 25‑29)
Ready‑to‑Eat	8.5 % – Premium pricing and limited distribution reach in tier‑2/3 markets impacted growth.	9.5 % – growth rate anticipated due to acceleration in new product formats (single‑serve, health-focused) and further penetration in e-commerce .
Ready‑to‑Cook	11.2 % – robust growth by benefitting from booming urban middle‑class expansion and the home‑cooking again trend.	12.5 % – additional upside from product‑innovation (eg, 3-minute breakfast mixes) and growing acceptance in the chilled‑batter products category.
Frozen Foods	13.0 % – the fastest‑growing category, driven by top-level sales of quick‑commerce, growing cold chain infrastructure and flourishing demand for ready-to-heat snacks.	14.3 % – As manufacturers scale up capacity, premium-flavour ranges and “food-as-a-service” models continue to thrive.
Overall Convenience‑Food Market	11.4 % – weighted average of the three sub-segments.	12.4 % – Macro‑economic tailwinds, higher rural consumption, and the health & wellness trend are expected to drive growth, particularly in canned fruits.

Source: RHP

Key Take‑aways

• Key driver continues to be Frozen foods. Robust cold‑chain investments and the rapid rise of quick‑commerce platforms are sustaining the growth rate.
• The ready-to-cook segment is leading in terms of product innovation, where new chilled batter and 3-minute breakfast ranges are broadening the addressable market
• Ready-to-eat is a niche but high-margin segment. Rising health consciousness and single-serve formats are likely to lead to a pickup in growth.
• Overall, the market is set to outpace the Indian GDP growth rate, reflecting strong consumer willingness to pay a premium for convenience, particularly within the growing middle‑class and time-stretched urban homes.

Orkla India Limited – Company Overview

Orkla India Limited (formerly MTR Foods Limited) is a 100-year-old company that was founded in Bengaluru as Mavalli Tiffin Rooms. It has evolved into a diversified manufacturer of food ingredients and convenience food products in India. In 2007, it became a part of Norway’s Orkla group.

Core Business & Operating Segments

• Spices: These include mixed spices (for example, Sambar, Chicken and Rasam masalas) as well as pure spices like turmeric, chilli, coriander and cumin.
• Convenience Foods: RTC mix, RTE products, vermicelli, pickles, papads, new DIY desserts, beverage mixes.
• Market Coverage: The product range covers the entire gamut of daily meals, i.e. breakfast, lunch/dinner, snacks/drinks and sweets
• Geographic Reach: Operations are concentrated in India, with export-oriented joint ventures in the UAE and other international trading corporations.

Competitive Positioning

Orkla India, through its MTR brand, holds a strong niche in branded spices and convenience foods. Backed by its Norwegian parent, the Orkla Group, it benefits from robust financial and technical support along with strong brand equity. However, it operates in a highly competitive, price-sensitive market with profitability pressures. Its trusted heritage and extensive distribution network continue to reinforce its market presence.

Strengths

• Strong Heritage Brand: The MTR legacy provides high consumer trust, strong recall, and wide shelf presence.
• Broad Product Breadth: Offers a diverse range of products catering to multiple meal occasions and price points.
• Orkla Group Backing: Benefits from access to global R&D capabilities, supply-chain expertise, and capital support from the Orkla Group.
• Integrated Distribution: Operates an established distribution network covering distributors, retailers, and retail touchpoints across India.
• Strategic Joint Venture: Maintains a presence in the Middle East and North Africa (MENA) region through its joint venture, ECMENA.

Weaknesses

• Intense Price Competition: Larger domestic and multinational players can offer deeper discounts and promotional incentives.
• Raw-Material Cost Exposure: Dependence on spice and grain procurement limits the ability to secure low-cost contracts.
• Scale relative to peers: Smaller asset base and market share compared with leading Indian FMCG giants (e.g., ITC, Nestlé, Unilever).

Financial Profile

Robust Revenue Growth: Orkla India Limited’s revenue from operations rose from ₹ 21,724.8 million in FY 2023 to ₹ 23,560.1 million in FY 2024 (+8.4 % YoY) and ₹ 23,947.1 million in FY 2025 (+1.6 % YoY). Growth was driven by strong consumer loyalty in the Spices category and a 7.6 % rise in Convenience Foods sales. Export revenue increased 9.9 % YoY to ₹ 1,196.9 million, supported by wider international distribution, while a ₹ 223.5 million insurance-related compensation from ECPL promoters added to income.

Better Profitability: Orkla India Limited’s profitability improved in FY 2025, supported by a 10.4 % reduction in raw-material costs and strong cost management. As a result, Adjusted EBITDA margin increased to 16.6 % and PAT margin to 10.7 %, reflecting stronger operational efficiency.

Table: Peers Comparison

Name of the company	Closing price (₹ per share)	Total income (₹ million)	EPS (Basic) (₹)	EPS (Diluted) (₹)	P/E	NAV per Equity Share (₹)
Orkla India Limited	730.00	24,552.4	18.7	18.7	39.04*	135.3
Tata Consumer Products Limited	1,176.4	178,115.5	13.1	13.1	90.1	202.1

Source: RHP; * – based on upper end of price band

 

Table: KPI Comparison

Company	Particulars (Units)	FY2023	FY2024	FY2025	CAGR
Orkla India Limited	Revenue from Operations (₹ mn)	21,724.8	23,560.1	23,947.1	5%
	Adjusted EBITDA (₹ mn)	3,124.4	3,436.1	3,964.4	13%
	Adjusted EBITDA Margin (%)	14.4	14.6	16.6	–
	Adjusted EBIT (₹ mn)	2,570.3	2,814.9	3,347.1	14%
	Adjusted EBIT Margin (%)	11.8	11.9	14.0	–
	PAT (₹ mn)	3,391.3	2,263.3	2,556.9	-13%
	PAT Margin (%)	15.6	9.6	10.7	–
	ROCE (%)	32.1	20.7	32.7	–
Tata Consumer Products Limited	Revenue from Operations (₹ mn)	137,831.6	152,058.5	176,183.0	13%
	Adjusted EBITDA (₹ mn)	18,300.9	21,985.1	23,861.4	14%
	Adjusted EBITDA Margin (%)	13.3	14.5	13.5	–
	Adjusted EBIT (₹ mn)	15,260.1	18,213.6	17,854.0	8%
	Adjusted EBIT Margin (%)	11.1	12.0	10.1	–
	PAT (₹ mn)	13,201.4	12,154.0	12,871.0	-1%
	PAT Margin (%)	9.6	8.0	7.3	–
	ROCE (%)	17.5	30.2	24.6	–

Source: RHP