Leo Dryfruits & Spices Trading Limited , a company known for its ISO 22000:2018 and ISO 9001:2015 certifications, has made a significant move in the packaged food segment. The company has entered into a Share Purchase Agreement to acquire a 60% equity stake in STK Food Processing Private Limited, a manufacturer of Makhana and Chana Sattu products operating under the POPMAK brand.

Key Details of the Acquisition

Strategic Implications

This acquisition aligns with Leo Dryfruits & Spices Trading Limited's strategy to expand its product portfolio and strengthen its presence in the packaged food segment. The move is expected to provide several benefits:

1. Expanded Product Portfolio: The acquisition will expand Leo Dryfruits' CSD product portfolio from nine to sixteen products, enhancing its offerings in the market.

2. Strengthened Market Presence: This strategic move will strengthen Leo Dryfruits' presence in B2G (Business-to-Government) and institutional channels through cross-selling and distribution synergies.

3. Complementary Business: STK Food Processing's operations complement Leo Dryfruits & Spices Trading's existing business, enabling a broader and more integrated product offering.

4. Market Expansion: The acquisition allows Leo Dryfruits & Spices Trading to leverage STK's established distribution network and customer base, potentially leading to deeper market penetration for both companies' products.

5. Product Diversification: STK Food Processing brings a range of makhana-based products to Leo Dryfruits & Spices Trading's portfolio, including products registered with the Canteen Store Department (CSD) under the Ministry of Defence.

Additional Investment

In addition to the equity acquisition, Leo Dryfruits & Spices Trading Limited has agreed to infuse a term loan of Rs 1.00 crore into STK Food Processing Private Limited. The loan terms are as follows:

• Duration: 24 months from the date of disbursement
• Interest Rate: 12% per annum, payable quarterly
• Repayment: Bullet payment of the principal at the end of the 24-month term

This strategic move by Leo Dryfruits & Spices Trading Limited demonstrates the company's commitment to growth and diversification in the packaged food industry. The acquisition of STK Food Processing is expected to enhance the company's market position and product offerings, potentially leading to increased revenue and market share in the coming years.

Leo Dryfruits & Spices Trading Limited (LDSTL) has taken a significant step towards expanding its market presence by entering into a Product Supply Agreement with Zepto Private Limited, a prominent player in the quick commerce sector. This strategic move marks LDSTL's entry into the rapidly growing quick commerce segment, which has been gaining traction in urban and semi-urban areas.

Key Details of the Agreement

Impact on LDSTL's Business

The partnership with Zepto is expected to have several positive implications for LDSTL:

1. Market Expansion: Entry into the quick commerce segment opens up new growth avenues.
2. Enhanced Market Presence: Collaboration with a well-known quick commerce platform could increase brand visibility.
3. Business Growth: The anticipated orders of ₹5.00 crores in the first year could boost the company's revenue.

Company Credentials

LDSTL brings strong credentials to this partnership:

• ISO 22000:2018 certification for Food Safety Management System
• ISO 9001:2015 certification for Quality Management Systems

These certifications underscore the company's commitment to quality and food safety, which are crucial factors in the food and beverage industry.

Market Implications

This agreement reflects the growing importance of quick commerce in India's retail landscape. For LDSTL, it represents an opportunity to adapt to changing consumer preferences, particularly in urban areas where demand for rapid delivery of groceries and other essentials has surged.

The collaboration between a traditional dry fruits and spices trading company and a modern quick commerce platform also highlights the ongoing convergence of traditional and digital retail channels in India.

Note: This agreement is not a related party transaction, as confirmed by the company.