ITC and PepsiCo are making strategic moves to acquire a 10% stake in Balaji Wafers, a regional Indian snack giant valued at nearly ₹40,000 crore. The race to secure a foothold in this growing sector reflects a larger trend: global and domestic players are turning their attention to regional brands, which have emerged as the fastest-growing segment in India’s snack industry.
Also read: Temasek Acquires 10% Stake in Haldiram for $1 Billion Deal
Balaji Wafers, founded in Gujarat in 1974, has steadily built a reputation for delivering high-quality potato chips, namkeens, and other snack products to millions of consumers, particularly in western and central India. Its success lies in a deep understanding of local tastes and distribution networks that outpace the reach of larger multinational competitors. While global giants such as PepsiCo have traditionally focused on western snack categories like chips and nachos, regional players like Balaji have excelled in ethnic snacks, now accounting for an increasing share of the market.
For PepsiCo, the interest is clear. The company is facing a slowdown in market share in India’s snack sector, especially in ethnic categories where local competitors have made significant inroads. Rather than starting from scratch, a minority stake in Balaji Wafers offers strategic access to established consumer bases and a manufacturing backbone finely tuned to regional preferences. Such an alliance would allow PepsiCo to expand its presence in the high-growth ethnic segment while leveraging backend synergies in supply chain and distribution.
ITC, on the other hand, sees the deal as a pivotal step in bolstering its food portfolio. Its existing brand, Bingo, has struggled to challenge the dominance of regional snack brands. By acquiring a minority share in Balaji, ITC aims to strengthen its market position and signal a renewed focus on becoming a more competitive player in the packaged food segment. The move aligns with ITC’s broader ambition to transition from a diversified conglomerate into a focused consumer goods powerhouse.
The rationale behind this strategic maneuver is not just driven by competition but also market dynamics. According to market researchers, India’s snack market was valued at ₹42,694.9 crore in 2023 and is projected to more than double to ₹95,521.8 crore by 2032. Consumer habits are shifting as urbanization and rising incomes fuel demand for convenient, packaged snacks. The ability of regional players like Balaji Wafers to cater to localized tastes while maintaining strong margins has caught the attention of global investors. In March, private equity firms and sovereign wealth funds, including Temasek and Alpha Wave Global, invested in Haldiram’s, another regional giant, at a valuation exceeding $10 billion.
Balaji Wafers’ own strategy is evolving as well. The Virani family, its founders, are reportedly looking to professionalize management, signaling a shift from a family-run business toward a more structured corporate governance model. This move positions Balaji as a more appealing partner for large-scale investors and strategic players alike.
Ultimately, the contest between ITC and PepsiCo highlights the growing value and potential of regional brands in India’s fast-evolving consumer market. The outcome of these negotiations could significantly reshape the competitive landscape, making Balaji Wafers not just a household name but also a strategic fulcrum in the ambitions of global and domestic snack players.
