In a strategic move to bolster its footprint in the organic and health-focused food sector, ITC Limited has announced the acquisition of Sresta Natural Bioproducts Private Limited (SNBPL), the company behind the popular 24 Mantra Organic brand. The deal, valued at approximately ₹472.5 crore, is poised to enhance ITC’s product offerings in the growing organic food segment, both domestically and globally.
A Major Step Towards a Future-Ready Food Business
ITC confirmed the acquisition in a regulatory filing on Thursday, stating it has entered into a share purchase agreement to acquire a 100% stake in SNBPL. The transaction includes an upfront payment of ₹400 crore at the time of closing, with the remaining ₹72.5 crore payable over the next 24 months. The acquisition is expected to be completed in Q1 of FY 2025-26, subject to the completion of customary closing conditions.
This acquisition is part of ITC’s ‘Next’ strategy under the leadership of Chairman Sanjiv Puri, which aims to develop a future-ready portfolio to meet the evolving health and wellness needs of Indian consumers.
Why 24 Mantra Organic?
24 Mantra Organic is one of India’s leading organic food brands with a portfolio of over 100 organic products spanning grocery staples, edible oils, spices, condiments, and beverages. The brand has also carved out a strong international presence, catering to the Indian diaspora across the globe.
What sets 24 Mantra apart is its vertically integrated supply chain, built over 21 years of operations. It has established a robust network of around 27,500 farmers spread over 1.4 lakh acres of certified organic farmland across 10 Indian states. This sourcing capability not only ensures quality and trust but also aligns with ITC’s vision of promoting sustainable farming and healthy living.
Voices from ITC and SNBPL
Hemant Malik, Wholetime Director at ITC Limited, expressed his enthusiasm:
“We are excited to have 24 Mantra Organic as part of ITC’s Foods Business’s portfolio of nutrition-led healthy foods products. The brand has built a trusted backend sourcing network. We are confident this acquisition will enhance our presence in the organic foods space.”
On the other side, Rajashekar Reddy Seelam, Founder and MD of SNBPL, said:
“After 21 years of partnering with Indian farmers to create trusted organic products, we are excited to see ITC take 24 Mantra Organic to new heights. This is a new chapter that will continue to promote sustainable farming and improve farmer livelihoods.”
A Lucrative Opportunity in Organic Foods
India’s organic food market has been witnessing exponential growth driven by rising health awareness, higher disposable incomes, and increasing global demand for chemical-free food products. With consumers actively seeking healthier alternatives, ITC’s decision to acquire 24 Mantra Organic is timely and visionary.
The move also places ITC in direct competition with other organic and health-focused brands, further strengthening its position as a diversified FMCG major.
ITC: A Quick Financial Overview
Here’s a snapshot of ITC’s current financial health and stock metrics:
| Metric | Value |
|---|---|
| Market Cap | ₹5,34,666 Cr |
| Current Price | ₹427 |
| High / Low (52W) | ₹495 / ₹378 |
| Stock P/E | 26.9 |
| Industry P/E | 32.4 |
| Book Value | ₹60.2 |
| Dividend Yield | 3.22% |
| ROCE (Return on Capital Employed) | 37.5% |
| ROE (Return on Equity) | 28.4% |
| ROIC (Return on Invested Capital) | 49.1% |
| Debt to Equity Ratio | 0.00 |
| Free Cash Flow | ₹13,724 Cr |
| Total Debt | ₹304 Cr |
With a zero-debt status, strong ROIC, and robust free cash flow, ITC is well-positioned to make strategic investments like this while continuing to reward its shareholders.
What This Means for Investors
The acquisition is a strategic win for ITC’s long-term vision. It enables the company to ride the organic wave while enhancing its nutritional product offerings in both urban and rural India. The synergy between ITC’s distribution muscle and 24 Mantra’s sourcing strength is expected to drive scalable growth in the coming years.
Moreover, the deal may unlock new export markets for ITC as 24 Mantra already enjoys a significant global footprint.
Q&A: Key Takeaways from the ITC-24 Mantra Organic Deal
Q1: What has ITC acquired?
A: ITC is acquiring a 100% stake in Sresta Natural Bioproducts, the parent company of the 24 Mantra Organic brand, for ₹472.5 crore.
Q2: Why is this acquisition significant?
A: It allows ITC to strengthen its presence in the growing organic and health food market, both in India and globally.
Q3: What products does 24 Mantra Organic offer?
A: It offers over 100 organic products including staples, spices, oils, condiments, and beverages.
Q4: How is 24 Mantra Organic different from other brands?
A: It has a strong backend with 27,500 farmers and over 1.4 lakh acres of certified organic farmland, ensuring a high-quality supply chain.
Q5: When will the deal be completed?
A: The acquisition is expected to be completed in Q1 of FY 2025-26.
Q6: Is ITC financially strong enough to make such investments?
A: Yes. ITC has a debt-free balance sheet, high ROIC, and strong free cash flow, making it well-positioned for strategic acquisitions.
Final Word:
The acquisition of 24 Mantra Organic by ITC is not just a business deal—it’s a signal of the company’s transformation toward a sustainable, health-oriented future. As consumer preferences shift, ITC’s strategic investments today could be the growth engines of tomorrow. Keep an eye on this space—it’s about to get organically exciting!
For more market insights, follow our news.
Stay tuned for more updates and insights on the stock market! For more insights on investing in the Indian stock market, check out resource like MoneyControl, ET, NSE India.
Disclaimer: This blog post is for informational purposes only and should not be considered financial advice. Investors should conduct thorough research and consult with a qualified financial advisor before making any investment decisions.