MTR owner Orkla India to sell 10-15% via IPO, raise $300 million

Orkla India, the parent company of popular brands MTR and Eastern spices, is planning to sell 10-15% of its stake via an initial public offering (IPO). This move is expected to raise approximately $300 million (around ₹2,500 crore), valuing the company at about $2 billion, according to sources.

IPO Expected Between June and November 2025

The company has already initiated discussions with bankers and is in the process of hiring them for the IPO. The listing is anticipated to take place between June and November 2025. Orkla India’s global board is scheduled to visit India this month to finalize the deal details. Currently, the plan involves only a secondary sale of shares, with no new shares being issued.

Strong Performance and Strategic Restructuring

In 2023, Orkla India’s MTR brand generated sales of ₹2,400 crore, with 70% of its revenue coming from spices and masalas. Last year, the company consolidated its Indian operations into a single entity, Orkla India, which now manages three business units: MTR, Eastern, and international business. This restructuring was aimed at enhancing their combined business capabilities and preparing for the IPO.

Orkla’s Positive IPO Readiness Study

Orkla India has not yet responded to requests for comment. Two months ago, the company announced it was exploring structural opportunities, including an IPO. Orkla’s CEO, Nils Selte, mentioned in July that the IPO readiness study yielded positive results. However, final decisions on the IPO are not expected until 2025.

MTR’s Journey from a Restaurant to a Market Leader

MTR, which began as a restaurant in Bangalore in 1924, ventured into convenience foods and instant mixes about 50 years later. Norway-based Orkla entered India by acquiring MTR Foods in 2007 and later bought a majority stake in Kerala-based Eastern Condiments about four years ago. Today, Orkla India gets three-fourths of its sales from southern states, with MTR leading in Karnataka and Andhra Pradesh, and Eastern dominating Kerala.

India’s Spices Market

India’s spices market is valued at around ₹90,000 crore, but only about a third of it is branded. In the organized spices category, Everest is the market leader, followed by MDH. Domestic players like MTR, DS Foods, Ramdev Food Products, and Eastern Condiments hold strong positions in select markets. Major consumer goods companies like Hindustan Unilever, Dabur, and Tata Consumers are also expanding their presence in the spices and ready-to-cook segments.

Industry Experts Weigh In on Orkla’s Growth Potential

Abneesh Roy, Executive Director at Nuvama Institutional Equities, noted that the food and spice market in India is highly attractive yet largely unorganized. He added that the MTR brand is strong and iconic, and with additional funds, the company could increase its visibility and market reach. However, the valuation will be crucial, as it will depend on how Orkla India plans to grow and justify a valuation of 7-10 times its sales, similar to other fast-moving consumer goods companies.

Recent Moves in the Spices Market

In recent years, other companies have also made significant moves in the spices market. Dabur acquired a 51% stake in Badshah Masala for ₹588 crore, while ITC purchased Sunrise Foods Pvt Ltd in an all-cash deal worth ₹2,150 crore. Wipro also entered the food business in India, aiming to become a significant player in the snack food, spices, and ready-to-cook market, acquiring traditional food brands Nirapara and Brahmins in Kerala.