ITC-Sunrise Foods Deal: Creating Business Opportunities for ITC

ITC-Sunrise Foods Deal: Creating Business Opportunities for ITC
Case Code: CLBS163
Case Length: 7 Pages
Period: 2019-20
Pub Date: 2020
Teaching Note: Available
Price: Rs.250
Organization: ITC Limited
Industry: Food & Beverage
Countries: India
Themes: Growth Strategy, Strategic Planning
ITC-Sunrise Foods Deal: Creating Business Opportunities for ITC


The case is about diversified Indian conglomerate ITC Limited’s acquisition of Kolkata, India-based spice business company Sunrise Foods Private Limited (SFPL). SFPL, a leading family-owned company, was engaged primarily in the spices business. Over the years, the spice brand had established a loyal consumer base, both in the basic and blended spices category. ITC, earlier called the Imperial Tobacco Company of India Limited, was a private company with a diverse presence in FMCG, hotels, packaging, paperboards & specialty papers, agri-business, and information technology. The company was one of India’s leading producers and exporters of high-quality foods and spices, sold underthe Aashirvaad brand.

To scale up its non-cigarette FMCG business and counter its rivals in the food business, ITC planned to grow in an inorganic manner. The FMCG giant looked to augment its product portfolio and significantly scale up its spice business across the country through acquisitions. In July 2020, ITC acquired 100% of the equity share capital of SFPL for Rs. 21.5 billion, its biggest acquisition till 2020. With the acquisition, the company added a 70-year-old brand and a market leader in eastern India to its spice portfolio.

ITC went in for the acquisition of SFPL during the Covid-19 pandemic, when people preferred to use branded and packaged products for safety, trust, and quality reasons. The acquisition was expected to help ITC gain a larger footprint as households switched from unbranded to branded spices. ITC said the acquisition was aligned with its strategy of augmenting its spices portfolio under the Aashirvaad brand and scale up its FMCG business across the country. ITC expected its FMCG business to achieve a turnover of Rs.1,000 billion revenue by 2030 and the acquisition of companies to contribute significantly to this end.


  • Understand acquisition as a part of a company’s growth strategy
  • Understand the demand for FMCG products during the Covid-19 pandemic
  • Understand how acquisition is used to augment the acquirer’s business
  • Examine how strategic acquisitions help companies become dominant players in an industry


On July 27, 2020, Indian Fast-moving Consumer Goods (FMCG) major ITC Limited acquired 100% of the equity share capital of Sunrise Foods Private Limited (SFPL), a branded spice business company based in Kolkata, India. After the acquisition, SEPL and its two arms – Sunrise Sheetgrah Private Limited, involved in transport, storage, and communications activity, and food stuff manufacturing company Hobbits International Foods Private Limited – became wholly-owned subsidiaries of ITC. Sunrise was a Kolkata-based family-owned company, engaged primarily in the spices business under the trademark “Sunrise”. ITC, a diversified business entity, had a presence across segments such as FMCG, hotels, packaging, paperboards, and speciality papers, agribusiness, and information technology. ITC completed the acquisition in an all-cash deal valued at Rs.21.5 billion amid the Covid-19 lockdown. “This is a positive development for ITC as among its diversified portfolio… Branded spices is an exciting and high-growth segment as consumers shift from unbranded to branded due to higher focus on safety, trust and quality,” said Abneesh Roy (Roy), Executive Vice President (Research) at Edelweiss Securities Limited.


Fast moving consumer goods business; Spices market; Product portfolio; Corporate finance; Acquisition; Share purchase agreement; Equity share capital; Conversion from unorganized to organized segment; Conversion from unbranded to branded products; Inorganic growth

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