DSM Fresh Foods Limited (Zappfresh) has signed a Memorandum of Understanding with a farm operator in Ghaziabad as part of its strategy to strengthen backward integration and build a more reliable sourcing ecosystem. The partnership represents a significant step in the company's efforts to create a structured farm-to-fork model that ensures transparency, efficiency, and long-term sustainability in sourcing.

Partnership Details

The collaboration enables Zappfresh to directly procure fish from aquaculture farms with specific operational parameters:

Strategic Objectives

The MoU aims to address key challenges in the fish and seafood category through comprehensive supply chain integration. According to Managing Director Deepanshu Manchanda, "Fish & seafood is already a meaningful part of our business, and we see it becoming significantly larger over time. The challenge in this category is not demand, it's supply consistency. By strengthening our presence at the farm level, we are solving for exactly that."

The initiative supports Zappfresh's larger strategy to move fish and seafood contribution from ~20% towards ~30% of its portfolio while building better control over quality, pricing, and supply.

Implementation Framework

Under the partnership agreement, Zappfresh will provide comprehensive support to enhance farm operations:

• Demand visibility and assured offtake for farm production
• Branding and traceability support at farm level
• Quality standardisation processes and monitoring
• Technical inputs to improve productivity and operational efficiency
• Integration into processing, cold chain, and distribution network

Operational Benefits

The collaboration focuses on maintaining proper farming practices, production records, and regular quality monitoring to create a stable and scalable sourcing model. This farm-level integration is designed to strengthen supply reliability, reduce sourcing volatility, and drive operational efficiencies through greater procurement control.

Future Expansion Plans

Zappfresh plans to expand similar collaborations across key sourcing regions to deepen its farm-level presence and build a scalable, transparent sourcing network. The company views such initiatives as important for the evolution of India's organised food ecosystem, particularly as demand for high-quality, traceable food products continues to grow.

Manchanda emphasized that "over time, this level of integration will define the difference between a trading business and a scaled, high-quality food platform," highlighting the strategic importance of backward integration in building a sustainable competitive advantage in the fresh and frozen food market.

DSM Fresh Foods Limited, operating under the Zappfresh brand, has announced its fund raising initiative through an investor presentation submitted to BSE Limited under Regulation 30 of SEBI Listing Regulations. The company is targeting a fund raise of approximately ₹100 crore with a proposed timeline of Q2 FY27.

Strong Financial Performance in H1FY26

The company demonstrated robust financial performance in the first half of FY26, establishing itself as India's first profitable D2C fresh protein platform. The integrated farm-to-fork fresh food platform reported comprehensive growth across key financial metrics.

Strategic Fund Utilization Framework

The proposed ₹100 crore fund raise will be deployed across four strategic pillars to accelerate the company's growth trajectory and market expansion.

Capacity and Retail Expansion

The company plans infrastructure upgradation across existing facilities while scaling retail footprint to drive branded presence. The focus remains on improving throughput, efficiency, and unit economics across operations.

Aquaculture Expansion

Incremental investment in aquaculture projects will enhance backward integration and supply security. This initiative is expected to be margin accretive with better control over raw material sourcing, particularly for the seafood segment which contributes approximately 20% of current revenue.

Working Capital Support

Funding will support higher inventory and receivables cycle requirements, enabling scale-up in operations and distribution while ensuring smooth execution of the growth pipeline.

Inorganic Growth Opportunities

Strategic acquisitions will accelerate market entry and capability expansion, with focus on adjacencies and value-added segments through opportunistic, ROI-driven deployment.

Operational Scale and Market Presence

DSM Fresh Foods operates through an omni-channel distribution model encompassing D2C app and website, B2B HoReCa partnerships, and retail stores. The company maintains three advanced meat processing facilities with end-to-end automation and multi-category manufacturing capability across Frozen, RTE, and RTC products.

Revenue Diversification and Growth Strategy

The company's revenue split in H1FY26 shows balanced distribution between B2C (52%) and B2B (48%) channels. The business demonstrated exceptional growth with 52% revenue CAGR from FY23-25 and 82% PAT CAGR during the same period.

DSM Fresh Foods projects revenue diversification beyond its core Zappfresh business by FY28, with emerging category Meevaa Foods expected to contribute 16% of revenue and new geographies contributing 6%, while the core business maintains 78% share.

Leadership and Strategic Vision

Under the leadership of Managing Director Deepanshu Manchanda, who brings over 15 years of techno-commercial experience and previously held management roles at Mobikwik while co-conceptualizing Licious, the company has established itself as a profitable platform in the competitive fresh food market. Manchanda's appointment as Goodwill Ambassador by IIMSAM reinforces the company's credibility in nutrition security and sustainable food systems aligned with United Nations Sustainable Development Goals.