DSM Fresh Foods Limited's board of directors has approved a strategic acquisition to strengthen its position in the food processing sector. The company announced its decision to acquire up to 76% stake in Avyom Foodtech Private Limited through a preferential issue participation, making it a subsidiary under the Companies Act, 2013.

Board Meeting Outcome

The board meeting held on January 21, 2026, from 4:00 PM to 4:30 PM, resulted in the approval of revised acquisition terms. This decision supersedes an earlier resolution passed on December 31, 2025, regarding the proposed investment. The acquisition will be executed in one or more tranches through participation in Avyom Foodtech's preferential issue of equity shares.

Investment Details

The key parameters of the acquisition are structured as follows:

Target Company Profile

Avyom Foodtech Private Limited, formerly known as IEY Education Private Limited, was incorporated on July 22, 2022. The company operates in food processing, manufacturing and allied food products sector with its registered office located in Central Delhi.

Financial Performance

Avyom Foodtech's revenue trajectory over the past three financial years shows:

Strategic Objectives

The acquisition serves multiple strategic purposes for DSM Fresh Foods Limited. The investment aims to strengthen the company's presence in the food processing and allied sector while enabling operational synergies and market reach enhancement. Avyom Foodtech specializes in manufacturing, processing, preparing, freezing, packaging, branding, marketing, distributing, importing and exporting of food products.

The target company's product portfolio includes ready-to-eat foods, ready-to-cook foods, frozen foods, snacks, gravies, sauces and other allied food preparations. Additionally, Avyom Foodtech operates manufacturing units, processing plants, cold storage facilities, and logistics infrastructure while engaging in research and development of food products and food-processing technologies.

Business Alignment

The acquisition aligns with Avyom Foodtech's proposed acquisition of operational business from Ambrozia Frozen Foods, a partnership firm, through a slump sale arrangement. This strategic move is expected to result in operational synergies, expansion of product portfolio and enhancement of market reach for the combined entity.

The transaction is structured as a related party transaction due to common promoters and directors between DSM Fresh Foods Limited and Avyom Foodtech Private Limited, conducted on an arm's length basis. No governmental or regulatory approvals are required for completing this acquisition.

DSM Fresh Foods Limited has announced a postal ballot notice dated December 31, 2025, seeking member approval for significant corporate restructuring through remote e-voting. The company has proposed two special resolutions that could reshape its business strategy and operational scope.

IPO Proceeds Reallocation Strategy

The primary resolution involves a substantial reallocation of the company's Initial Public Offering proceeds. DSM Fresh Foods raised ₹5,285.53 crores through its IPO in Financial Year 2024-25, and now seeks to redirect ₹1,000 crores toward strategic acquisitions and corporate initiatives.

The reallocation requires approval from more than 90% of shareholding voting through remote e-voting. The company has utilised ₹2,774.10 crores (52.48%) of the total IPO proceeds as of December 30, 2025.

Business Expansion Through Object Clause Amendment

The second resolution proposes adding six new sub-clauses to the company's main business objects, expanding its operational scope significantly:

• Food Manufacturing & Processing: Comprehensive operations including ready-to-eat foods, ready-to-cook foods, stuffed breads, parathas, curries, gravies, sauces, and snacks
• Infrastructure Development: Establishment of factories, R&D laboratories, cold storage units, and distribution centers
• Research & Innovation: Food-processing technologies, preservation techniques, and intellectual property management
• Agricultural Trading: Wholesale and retail trading in agricultural produce, fertilizers, and biochemicals
• Diversified Business Activities: Including potential motor vehicle dealership operations
• Ancillary Operations: Supporting activities for main business objectives

E-Voting Process and Timeline

The company has partnered with Central Depository Services (India) Limited (CDSL) to facilitate the remote e-voting process. Key dates and procedures include:

Eligible members whose names appear in the Register of Members as of the cut-off date and have registered email addresses will receive the postal ballot notice electronically. The company has appointed Rawal & Co. as the scrutinizer to ensure fair and transparent voting.

Strategic Rationale and Financial Impact

Management expects the proposed reallocation to be earnings-accretive, particularly through the acquisition of established Ready-to-Eat and Ready-to-Cook businesses. The company anticipates:

• Enhanced Revenue Diversification: Entry into higher-margin RTE/RTC segments
• Improved Capital Efficiency: Earlier deployment into revenue-generating assets
• Strengthened Cash Flows: Reduced gestation risk through acquisition of operating businesses
• Greater Financial Flexibility: Enhanced liquidity management through general corporate purposes allocation

The proposed fund utilization timeline spans Fiscal Years 2026 and 2027, with 50% deployment planned in each year. The company believes this strategic shift will enhance shareholder value while maintaining financial stability.

Regulatory Compliance and Risk Factors

The postal ballot complies with Section 110 of the Companies Act, 2013, and SEBI regulations. However, the company has identified several risk factors, including acquisition completion uncertainties, regulatory approval dependencies, and market condition variables that could impact the proposed utilization.

Results will be published on the company's website at www.zappfresh.com and communicated to BSE Limited, where the company's equity shares are listed under scrip code 544568.