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  • Writer's pictureBexley Advisors

<Oct 18, 19> Bexley Advisors Quoted in VCCircle: "HR’s Brand Equity Could Earn Retail Fillip for KW"

Updated: Mar 30, 2020

Why Haldiram is Keen to Acquire Bankrupt Dairy Firm Kwality

..Delhi-based Haldiram Snacks, in a tie-up with brokerage firm Pioneer Securities Pvt. Ltd, has emerged as the sole bidder to take over Kwality through an insolvency resolution process. Kwality’s lenders haven’t yet cleared Haldiram’s bid, though they are likely to do so in the absence of any other option even though it means they will have to take a deep haircut.


“Dairy procurement is a challenge in India: it is a highly fragmented market, with three-fourths of procurement done directly from small dairy farmers,” says Utkarsh Sinha, managing director at boutique advisory firm Bexley Advisors.

Sinha says that, for a processed foods maker, there are strong advantages to streamlining this process. “Many of Kwality’s products like paneer, cheese and ghee are inputs for Haldiram, providing for significant savings potential.”


Clearly, Haldiram has its task cut out. To start with, it will have to revive Kwality’s factories and then increase the production of value-added products to realise maximum margins.

Sinha of Bexley Advisors says that, while Kwality has good brand recognition in North India, Haldiram has a stronger brand and bigger retail footprint. This could provide significant opportunity to grow Kwality’s procurement networks.

“One can even argue that Haldiram’s brand equity would allow for a retail premium on Kwality’s existing value-added dairy products,” he says.


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