IFC-backed agri-commerce startup WayCool Foods is looking to become a Rs 6,000-crore entity by FY25, up from Rs 2,000 crore in FY23, driven by its fast-growing food products vertical.
Chennai-based WayCool was founded in 2015 by auto industry veterans Karthik Jayaraman and Sanjay Dasari, the son of the former head of Ashok Leyland, Vinod Dasari. It was founded as a social enterprise and agri-tech company.
Later, it diversified into agri-products with a slew of ready-to-cook and other packaged food brands such as Madhuram, Dezi Fresh, Lexotique, Kitchenji, and Freshey's.
These brands have fetched around 25% of its Rs 2,000 crore revenue in FY23, up from 10% in the previous fiscal, when it was Rs 1,000 crore.
Jayaraman, the cofounder and managing director, expects this to scale to 35–40% by FY25, when the company targets to log in Rs 6,000 crore in turnover.
"We closed FY23 with Rs 2,000 crore of topline. Of this, as much as 25% came from the branded products and third-party distribution fees (for FMCG majors like HUL, ITC, and Nestle, among others), and we hope this segment grows faster and fetches us 35–40% of the targeted income of Rs 6,000 crore by FY25," Jayaraman told PTI in an interview.
He noted that future revenue will be driven more by products than commodities sourcing and trading, which has been its mainstay so far.
On profitability, Jayaraman said, the company is cash-positive now and hopes to turn a net profit by FY25, when it also has plans to go public.
But he was quick to note that taking the firm public is dependent on meeting these revenue and profitability targets, along with certain other operational metrics.
The company trades in almost all agricultural commodities, along with some fruits and vegetables, which it sources directly from farmers at market prices. Soon it will begin to source more fruits and vegetables, grains, staples, dairy products, and dry fruits, he said.
Its brands reach out to over 60,000 retailers in the South, while farmer engagement has over 85,000 of them in its supply chain, he said. Some of them are available on online platforms as well.
WayCool has also entered contract farming of vegetables with a 3.5-acre farm in Hosur, near Bengaluru, and hopes to ramp it up to 500 acres soon, he said.
He said the company has so far raised $150 million from eight institutional investors, including Lightrock, the world bank arm International Finance Corporation, and the Netherlands impact fund FMO.
The company is present in all six southern states, and Jayaraman said they have no plans to expand to other geographies, except for those agricultural items that are not grown in the South.
Accordingly, it has tied up with farmers in Maharashtra for potatoes, and for apples and citrus with Himachal growers.
WayCool also has a distribution arm in the UAE, under which it sells around 25 products now and operates 30 warehouses across the southern states and Maharashtra, with around 3 lakh square feet.
WayCool's R&D arm has developed many farming tools and has already bagged six patents; 30 other patent applications are pending.
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