The Chennai-based food and agribusiness start-up said it hopes to go public by May 2025, as part of a medium-term fundraising strategy. In the run-up to its IPO, the company hopes to raise between Rs 800 and 1,000 crore in its next round of funding over the next 24 months, said co-founder and CEO Karthik Jayaraman. CNBC-TV18 in an exclusive chat.
“We will need the deployment of Rs 800 to 1,000 crore over the next 24 to 36 months in various investments – we will invest heavily in technology and automation and in the construction of 35 warehouses – after the next round of funding” , said Karthik, “Our product development and marketing activities will also attract investment, although we seek to acquire companies that complement our work and add value to our investments.”
Revenue quadrupled since March 2020
Waycool’s announcement comes as the company has had a dream for the past 18 months, using back-to-back COVID-19 lockdowns to boost its automation, warehouse strength and supply centers.
Since March 2020, the company has increased its tonnage by 3.5 times – from 250 tonnes per day to 900 tonnes per day – and quadrupled its revenues. “Our income was between Rs 20-22 crore per month in March of last year; it is over Rs 80 crore today,” Karthik said.
Focusing on delivering fresh produce and packaged food to Kirana stores during the height of the lockdown, the start-up said it was able to “serve a large percentage” of their needs. “We made sure to keep increasing capacity and delivering quantities,” Karthik said. “In doing so, we have succeeded in tripling the throughput in warehouses even without physically expanding our space.”
By embarking on this operation, Waycool has greatly automated its own warehouses. A range of robotic arms, conveyor belts and computerized product sorting is the main feature of one of the company’s main warehouses in Chennai. Automation has also infiltrated the day-to-day operations of start-ups and interactions with stores. “All orders are processed by robots and this has led to an increase in efficiency,” Karthik said.
“Foray into value-added food products”
Over the past year or so, Waycool has strategically shifted from being a supplier of fresh produce to what Karthik calls a “full-service player” in the food and agro-tech arena. “More than 50 percent of our volumes come from grains, commodities, milk and packaged foods,” he said. “We are also looking to enter the meat and value-added segments.”
These segments largely include pasta, healthy blends and pre-cubed tamarind, which will form Waycool’s last mile baking product line: “Almost 20-25% of our volumes will be represented by these products.”
The company expects volume growth in its raw materials segment, while hoping that the new line of value-added products will increase its margins. Given the potential IPO he hopes to issue by 2025, Karthik said that special emphasis on better corporate governance is also on the agenda: “We would like to be listed in such a way. profitable, and we are on track to do so.”
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