ITC Ltd., one of India’s largest conglomerates, is reportedly in advanced discussions to acquire MTR Foods Pvt. Ltd. and Eastern Condiments Pvt. Ltd. from Norwegian parent company Orkla ASA. The estimated $1.4 billion deal could significantly reshape the country’s fast-moving consumer goods (FMCG) landscape, reinforcing ITC’s dominance in South India’s thriving food market.
Strengthening ITC’s Southern Presence
For ITC, which has steadily expanded its FMCG footprint over the years, this acquisition aligns with its aggressive growth strategy. MTR and Eastern Condiments are market leaders in South India, with deep-rooted consumer trust in states like Karnataka, Kerala, Tamil Nadu, and Andhra Pradesh. Together, these brands generate over 80% of Orkla India’s revenue, which stood at Rs 2,400 crore in FY24.
Acquiring these brands would not only give ITC access to an established distribution network but also enhance its product portfolio in the ready-to-eat and spices segments. MTR, with its heritage in authentic South Indian cuisine, is particularly well-positioned to cater to the growing demand for convenience foods, both in India and in international markets like North America, West Asia, Japan, and Southeast Asia.
Expanding the FMCG Empire
ITC’s interest in MTR aligns with its broader ambition to dominate the packaged food sector. The company has made strategic acquisitions in the past, including the 2020 purchase of Sunrise Foods to bolster its spices and condiments segment. More recently, in February 2025, ITC acquired Prasuma, a leading frozen and ready-to-cook brand, further signaling its intent to lead in the evolving convenience food space.
This latest potential acquisition would also help ITC fortify its position against competitors like Tata Consumer Products and Nestlé, which have been vying for a larger share of India’s burgeoning branded food sector. The growing consumer preference for branded spices and packaged foods presents a lucrative opportunity, and ITC’s well-established distribution network across India makes it well-equipped to capitalize on this shift.
The Competitive Landscape and Market Implications
India’s FMCG market, particularly in the food segment, is witnessing intense competition. Orkla has acknowledged that India’s market is significantly more complex than its European counterparts, with sharp regional variations in consumer preferences. By acquiring MTR and Eastern, ITC gains an upper hand in addressing these regional nuances while also leveraging synergies in procurement, manufacturing, and distribution.
However, ITC’s stock has not immediately reacted positively to the news, closing nearly 1% lower. While investor sentiment may take time to align with ITC’s long-term vision, the company’s strategic focus on food innovation and market penetration suggests that this move could be a game-changer in the years ahead.
What’s Next for ITC?
If the deal materializes, ITC will likely integrate MTR and Eastern into its existing FMCG business, driving synergies across product categories and expanding its geographical reach. With an eye on Western India as its next frontier, ITC’s acquisition spree underscores its ambition to create a dominant pan-India packaged foods empire. This strategic push could redefine the company’s future and reshape India’s packaged food industry for years to come.
