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ITC Limited set to acquire Sresta Natural Bioproducts for Rs 472.50 crore in all-cash deal
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Wednesday, 23 April, 2025, 08 : 00 AM [IST]
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Our Bureau, Bengaluru
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ITC has now signed a share purchase agreement to acquire the Hyderabad-based Sresta Natural Bioproducts, the company behind the 24 Mantra Organic brand, for up to Rs 472.50 crore. The all-cash deal aims to boost its presence in the growing organic food market and cement its position in both domestic and international markets. It includes an upfront payment of Rs 400 crore and a contingent consideration of up to Rs 72.50 crore payable over two years, depending on performance milestones.
The acquisition is expected to help leverage its existing strengths in product development, sourcing, and distribution to further expand 24 Mantra Organic's reach. The company led by Rajashekar Reddy Seelam as its managing director has over 100 products in its portfolio across grocery staples, spices and condiments, edible oils and beverages.
Its vertically integrated supply chain promotes sustainable livelihoods for its network of approximately 27,500 farmers spread across approximately 1.4 lakh acres of certified organic land in 10 States. The network of farmers and certified organic sourcing capability are key sources of competitive advantage for the company. All the farming projects are under Organic Certification for Euro 2092/91 standards, US NOP and Indian NPOP organic standards. Most of the projects are certified by Control Union International, ONECERT.
Union Government has been actively promoting the organic foods industry through various schemes and initiatives, to improve the livelihoods of farmers, boost exports, enhance packaging/ marketing of products and ensure food security, while promoting sustainable agriculture. India is also well-positioned to become a global hub for organic sourcing with existing strengths in areas like rice and organic tea.
Indian organic market both domestic and exports is currently estimated to be Rs 10,000 crore. in size. The category has high growth potential given the low penetration levels domestically as well as globally and the growing consumer preference towards natural and organic food products.
The organic foods space is an area of interest, given the strong synergistic linkages to its branded packaged foods portfolio and the immense growth potential of the category. The acquisition will unlock value creation opportunities to drive synergies in product development and innovations, sourcing, manufacturing, supply chain and distribution.
This investment is in line with the 'ITC Next' strategy articulated by Sanjiv Puri, chairman ITC that focusses also on building a future ready portfolio of products that serves evolving consumer needs.
Hemant Malik, wholetime director, ITC, said, "We are excited to have 24 Mantra Organic as part of ITC's Foods Business's portfolio of nutrition-led healthy foods products. 24 Mantra Organic has built a robust backend and sourcing network which is core to its trusted organic products portfolio. Aligning with national priorities, we are confident that 24 Mantra Organic will fortify ITC's presence and market standing in the high growth organic products space, in both Indian and overseas markets."
Seelam said, "After 21 years of partnering with Indian farmers to create trusted organic products, we are excited that ITC will be driving the next phase of growth for 24 Mantra Organic. ITC shares a common vision to promote sustainable livelihoods for farmers and ensure healthy lifestyle for consumers. We are confident that ITC's strengths in product development expertise and distribution strength across channels will help in taking 24 Mantra Organic to millions of homes for many generations to come, improve livelihoods of large number of farmers across the country and carry forward our legacy of ecological stewardship.”
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