[Startup Bharat] How this Punjab-based drinks startup is betting on traditional Indian flavors

Founded by three cousins ​​– Saurabh Munjal, Saurabh Bhutna and Nikhil Doda – in 2017, archian foods was launched with the vision of introducing better taste, category-defining ‘desi’ drinks in India, targeting both rural and urban markets.

Realizing that there are hardly any organized players in the house/desi drink segment except for the top two to three players, the Startup based in Mohali launched its brand Inasmuch asLahoriInasmuch as.

Talking about the brand, Saurabh Munjal, CEO and co-founder of Lahori, tells Your story,

“Since our entire product line is inspired by Indian cuisine and the street food of this country, we wanted to keep a traditional name for our drinks. Besides the key ingredient in most of our flavors, rock salt, another name for Lahori. This is how the name ‘Lahori’ was born.

The range of selected drinks which claim to be packed with natural ingredients come in four ready-to-drink variants – Zeera, Nimboo, Kacha Aam and Shikanji.

Lahori – drink variants

Creation

“While a few may opt for artificially flavored drinks, natural drinks are still hard to beat,” quotes Saurabh Munjal.

“Nikhil Doda and his family have local culinary skills. Nikhil has always tried to experiment with drinks made from home ingredients – spices available in the kitchen,” he adds.

In such a case, he got Saurabh Munjal and Saurabh Bhutna taste it Zeera drink, and they thought it definitely had the potential to be sold commercially. The three came together and started small-scale operations in 2017.

They started with a production capacity of around 96,000 bottles per day. Currently, the startup has the capacity to manufacture 1.2 million bottles per day.

“Our state-of-the-art manufacturing unit is fully automated, spread over 160,000 square feet in Roopnagar, Punjab, where nearly 1.2 million bottles are packed daily. We are proud to have a dedicated green belt of over two acres of land to replenish natural groundwater. We strive to maintain quality not only by adhering to our own SOPs, but also by adhering to global standards,” says Munjal.

He states that in about two to three months they will double the capacity to 2.5 million bottles/day.

The team

With a overall team size of 300 members (190 roster members with over 110 contract workers), Saurabh Munjal focuses on finance and overall strategy, while working on brand and marketing functions. Nikhil (CPO) handles product, R&D and distribution strategies, and also oversees the sales teams. Meanwhile, Saurabh Bhutna (COO) is in charge of operations and has the production, quality and human resources team at the factory under him.

Lahori Co-Founders (L:R) Nikhil Doda (CPO), Saurabh Munjal (CEO), Saurabh Bhutna (COO)

Economic model and traction

the soft drink industry in India is growing at a phenomenal rate and is expected to surpass $18 billion by 2026, according to Mordor Research. The Indian market currently remains underpenetrated with a low per capita consumption of around 5.5 liters per year, despite the size of the population compared to the per capita consumption in the United States, which is estimated to be at least 20 times higher. high.

In India, since the majority of the population resides in Tier II and III cities, pricing levels have been a key aspect in penetrating markets and building a brand with customer loyalty.

The 160ml variant of Lahori is priced at Rs 10 per bottle with a shelf life of three months, but stays on the shelf for only a day or two, claims Munjal.

Its SKUs include Zeera (including a stevia-based variant), Nimboo (both carbonated and non-carbonated variant), Shikanji, Imli Banta, and KachaAam.

The products are sold in the northern part of the country, with deep penetration into Punjab, Haryana, Delhi, and western parts of UP. Additionally, pilot projects have been conducted in more than eight states. Drinks are sold by 500+ distributors on the other side 4,000 to 5,000 Kirana stores.

“It’s a negative working capital activity – products are sold out in advance – which says a lot about Lahori’s brand traction and recall,” says Nikhil.

The YS design team

With revenue of Rs 80 crore generated in FY21, Lahori is on track to achieve net income of Rs 250 crore in FY22 and plans to reach Rs 1,000 crore in the next next three years.

Funding and way forward

In January of this year, the brand raised $15 million in funding from a consumer-oriented Belgian investor Verlinvest for an undisclosed minority stake. Lahori said it will use the funds to double its brand growth through offline and online expansion, and also strengthen its national presence in retail chains.

Talking about competitions, Munjal adds: “Among the competitors, we believe that with the type of offers we offer, we are the only ones. That said, in the soft drinks space, there are only three players – that is, Coke, Pepsi and Parle Agro – operating in an organized fashion.

Talking about the future plans, Saurabh Munjal says that the brand plans to cover the entire northern part of the country within this very year. However, they must first overcome certain challenges.

“Freight is a bottleneck for us. We cannot manufacture something in Punjab and then sell it in Maharashtra because the freight is very high. our reach by establishing factories in several regions of the country. Over the next two to three years, we plan to make our product national by having a factory somewhere in the west as well as in the east. This is the plan to make Lahori a national brand,” he added.

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