Business

ITC buys into vending machine start-up

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To add heft to distribution via channel

ITC Ltd. has acquired a 33.4% stake in Delectable Technologies, a five-year-old start-up engaged in fabricating vending machines and app-based sale of FMCG products via machines.

In a regulatory filing, ITC said this would help strengthen the presence of ITC’s FMCG products in the emerging distribution channel of vending machines.

The cash deal involves an investment of ₹7.5 crore in four tranches within 12 months, subject to completion of agreed conditions precedent and milestones.

The start-up was founded by IIT graduate Satvik Sarwarde in 2014. Its networth was ₹1.5 crore in 2018-19. The move is seen by insiders as aimed at making ITC’s FMCG (especially food) products more accessible.

Hinting at such a foray, ITC chairman Sanjiv Puri had said at the AGM in July, “your company’s formidable distribution network enables it to place products in more than six million retail outlets.... substantive investments are being made in developing alternate and emerging channels such as modern trade, on-the-go, food services, end-to-end cold chain, e-commerce and so on. The benefits of digital technology are being leveraged with focussed investments in areas such as customised mobility solutions.”

Similar vending machines have already been installed by another city-based firm, which recently entered the food FMCG segment.

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Printable version | Dec 14, 2019 10:50:02 PM | https://www.thehindu.com/business/itc-buys-into-vending-machine-start-up/article29965594.ece

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