ITC’s food-tech vertical shows serious muscle, grows at 108% CAGR; national expansion in sight

FMCG major ITC is quietly building a food-tech engine, and that is beginning to show some serious results. Over the last three years, the conglomerate’s cloud kitchen business has clocked 108% compound annual growth rate (CAGR). At a time when most FMCG giants are experimenting with digital models, ITC seems to be scaling one.

This food-tech vertical – what the company describes as a synergy between its foods, hotels, and digital operations – is now spread across 60 cloud kitchens in five cities. These kitchens deliver restaurant quality meals under four brands: ITC Master Chef Creations, Sunfeast Baked Creations, Aashirvaad Soul Creations, and Sansho by ITC Master Chef.

“This business…is setting new benchmarks in culinary innovation and tech-enabled operations, gaining increasing consumer franchise,” said chairman Sanjiv Puri at the company’s 113th annual general meeting, adding that it’s “now being progressively introduced across India.”

This isn’t just an experiment on the sidelines. It’s part of a broader pivot. ITC’s ‘Next’ strategy is pushing the company to build “future-ready” portfolios – both organically and through new bets that go beyond traditional categories it has operated in. And food-tech is emerging as one of those sharp new vectors.

Food-tech remains particularly strategic, allowing ITC to blend its consumer insights with culinary capabilities from its hotel division and digital muscle. While competitors are building direct-to-consumer snack or grocery platforms, ITC’s move into full-stack meal delivery, complete with branded offerings, is relatively differentiated.

The company is also backing these ambitions with capital. It has invested in eight manufacturing units in recent years and plans to deploy Rs 20,000 crore across businesses in the medium term. This includes areas like sustainable packaging and value-added agri-products segments with long-term relevance and regulatory tailwinds.

Packaging too is becoming a serious play. ITC’s R&D arm has developed compostable and recyclable packaging under brands like Filo and Bioseal, and it’s now commercially available. This vertical has grown 2.4x since FY22. In parallel, the company has kicked off operations at its new moulded fibre products facility in Madhya Pradesh, which will manufacture engineered packaging made from bamboo, bagasse, and wastepaper for export under the ‘Fyba’ brand.

For the full financial year 2024-25, ITC’s net profit rose 68.9% to ₹35,052 crore from ₹20,751 crore in FY24, while revenue from operations increased 10.4% to ₹81,612.78 crore.

But whether ITC’s food-tech operation, that is now front and centre in the company’s multi-pronged growth strategy, can scale nationally and compete with entrenched delivery-first players, remains to be seen. For now, the numbers suggest it’s working.