HyFun Foods has charted out an expansion plan which would see it migrating from a potato processor with established brand presence to larger frozen-foods company, Haresh Karamchandani, MD and group CEO told FE.
A clutch of new products – pizzas, kebabs, momos, processed vegetables etc — will be launched over the next few months, he said, adding that this would help increase the sales turnover of Rs 5,000 crore in the next five years.
Karamchandai said by FY29, domestic market would account for 50% sales, and the rest, exports. The company reported turnover of Rs 1,200 crore in FY24, 70% of which via exports.
According to him, the company will be able to tap the capital market in the next 2-3 years to fund their expansion beyond Gujarat to key potato growing regions of Uttar Pradesh and Madhya Pradesh. The expansion will be see a major upgrade in processing and procurement infrastructure.
The company currently processes 0.35 million tonne (MT) of potato annually.
“There are limitations in accessing credit from banks and financial institutions for expansion of our infrastructure to meet rising exports as well as domestic demands,” Karamchandani told FE.
The company, which started its commercial production in December 2015, became the industry leader in processing 0.2 MT of potatoes in 2021. Currently, 70% of sales income from exports of potato products to 40 countries to quick service restaurants like Burger Kings, KFC, Pizza Hut and Domino’s.
HyFun Foods has contract farming arrangements for sourcing processing varieties of potato with 6300 farmers mostly in Gujarat and Madhya Pradesh. It is aiming to expanding its network to 10,000 farmers by the end of current fiscal and by end of FY29, farmers’ network would expand to 30,000 farmers across Gujarat, Madhya Pradesh, Uttar Pradesh, Punjab and Himachal Pradesh for production of potato seeds as well as sourcing raw material
“As we have established contract farming in potato, the next crop will be onion where we will work in Maharashtra, Madhya Pradesh and Gujarat. products dehydrated onions and frozen production,” Karmchandai said.
The company follows ‘seed-to-shelf business model, which starts with contract farming for seed multiplication of processing varieties of potatoes and procurement of crops through a buyback agreement prior to commencement of sowing by farmers at the predetermined prices. “Contract farming assures incomes for the farmers while protecting them from market fluctuations,” the company official said.
The agriculture supply chain ensures raw potato is stored in cold storage and supplied to their state-of-the-art processing plants periodically, the official said.
From: financialexpress
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