City-based FMCG startup Nilgai Foods is tapping the institutional segment to drive sales and is looking to raise about USD 10 million to fuel its expansion across the country, a top company official said.
The firm, which sells packaged coconut water under the 'Cocofly' brand as well as chutneys and hot sauces under the 'Pico' brand, said it has a ready pipeline of products like jams, preserves, snacks, baked products and cookies which would be available for institutional sales.
"Currently, institutional sales is about 10 per cent of the revenues but in 3-4 months our plan is that it should start contributing 60 per cent.
"Over the last one year we have been very focused on developing ultra-large institutional plants," its co-founder and Chief Executive Officer Abhay Jaiswal told PTI.
Cocofly, which started selling on Vistara Airlines, got a good response and the company is in discussion with other airlines and Railways for sales.
The fledgling company is aiming for a turnover of Rs 8 crore this fiscal and targeting around Rs 20-30 crore from institutional sales next year, while eyeing a total revenue of Rs 50 crore.
Focused on the Delhi-NCR market at present, the company is looking to raise around USD 10 million to fuel its expansion.
"We have enough capacity with 2 million litres a month for Cocofly to do a pan-India launch. However, to do a multi-city pan-India launch, we will require more capital to expand our distribution team and marketing.
"We will need to raise USD 8-10 million for it and it will be allocated over 3 years. About 60 per cent of it would go into marketing, while 30 per cent would be utilised for distribution expansion," he said.
Jaiswal added if the pan-India launch for Pico and Cocofly materialises, the company would be able to clock a turnover of Rs 300 crore in four years.
The company is also planning to launch a variant of
Cocofly which will be cost effective and also a product for kids next year.
Nilgai Foods started exporting chutneys to US, Middle East and Africa from October and will ship its products to UK by February.
Jaiswal said the company aims to generate a revenue of Rs 12 crore from exports in the first year.
"We have around 9 sauces and chutneys but some of them are not differentiated enough for the exports market, so we are only concentrating on a subset of our range, with four to five products, for exports," he said.
The company is also evaluating export opportunities for Cocofly and Jaiswal said it would be at least 30 per cent cheaper over other brands available in these countries.
"We are the first company which has developed a supply chain of coconut water in India, so taking the advantage of that, when we start shipping our coconut water, ours would be the most cost effective brand in western markets," he said.
He said the packaged coconut water is a USD 2 billion trade globally and India's share is negligible at less than 1 per cent, despite being the third largest producer of coconuts in the world.
Currently, the coconut water sold in Western markets is being sourced from Thailand, Indonesia, Philippines, Sri Lanka and Brazil.
The company also plans to export its other products under a new brand, starting from Africa.
