ITC 24 Mantra Acquisition: Strategic Move into ₹10,000 Crore Organic Market

Published on April 19, 2025

ITC has announced the acquisition of 24 Mantra, a premium organic food brand, for ₹472 crore. The deal involves the purchase of Sresta Natural Bioproducts, the company behind the 24 Mantra brand, which has established itself as a leader in the rapidly growing organic food market in India. This ITC 24 Mantra acquisition marks another significant step in ITC’s inorganic growth strategy as it continues to expand its presence in the premium food segment both domestically and internationally.

Key Details of the ITC 24 Mantra Acquisition

The ITC 24 Mantra acquisition deal, valued at ₹472 crore, is expected to be completed in the first quarter of 2025-26. This strategic move brings a well-established organic brand with over 100 products under ITC’s portfolio. Raj Seelam, the founder of Sresta Natural Bioproducts, will assist in the transition and continue with the company for two years to ensure continuity and smooth integration.

Strategic Rationale Behind the Purchase

Several key factors drove the ITC 24 Mantra acquisition, aligning with ITC’s broader strategy to expand its food portfolio with premium, health-focused brands. 24 Mantra brings significant value to ITC through its established brand equity, diverse product range, and international market presence.

The brand resonates strongly with health-conscious consumers looking for certified organic options, a segment that ITC has been keen to penetrate. With consumer preferences increasingly shifting toward organic and natural foods, this acquisition positions ITC strategically in a high-growth category.

The ₹10,000 Crore Organic Market Opportunity

A primary motivation for the ITC 24 Mantra acquisition is the immense growth potential in the organic food segment. ITC cited reports estimating the combined domestic demand and export potential for organic foods at approximately ₹10,000 crore, positioning this as a high-growth opportunity.

Despite this potential, organic food penetration in India remains remarkably low at just 0.3 percent, indicating substantial headroom for growth. As consumer awareness about health, sustainability, and food safety continues to rise, the organic segment is expected to expand significantly in the coming years.

The Indian organic food market is projected to grow significantly, offering substantial opportunity for the newly acquired 24 Mantra brand under ITC. (Image: Representative)

Through this acquisition, ITC gains immediate scale in this emerging segment, leveraging 24 Mantra’s established presence rather than building an organic portfolio from scratch—a strategy that aligns with its broader approach to entering specialized food categories through targeted acquisitions.

24 Mantra’s International Market Presence

A significant aspect of the ITC 24 Mantra acquisition is the brand’s strong international footprint, particularly in the United States. International markets account for nearly half of 24 Mantra’s ₹300 crore annual turnover, with the US being the primary export destination.

The brand has built an impressive distribution network across more than 900 ethnic stores in the US, establishing itself as a preferred organic choice, particularly among women consumers. This international presence provides ITC with an established platform to expand its global footprint in the premium organic food segment.

For ITC, which has been looking to expand its international presence, this acquisition provides an immediate entry point into key diaspora markets with an established brand that already has consumer trust and retail relationships.

Certified Organic Farming Network

Another valuable asset gained through the ITC 24 Mantra acquisition is the company’s extensive network of certified organic farmers. Similar to ITC’s own agricultural initiatives, 24 Mantra has developed a well-structured backend farmers’ network spanning 10 states across India.

This network encompasses an impressive 1.4 lakh acres of certified organic land, ensuring a reliable supply chain for sourcing authentic organic ingredients. The established farmer relationships and certification infrastructure represent significant value, as building such a network organically would require considerable time and investment.

24 Mantra’s network covers 1.4 lakh acres of certified organic farmland across 10 Indian states, providing a strong agricultural foundation for the ITC 24 Mantra partnership. (Image: Representative)

The synergy between ITC’s existing agricultural expertise and 24 Mantra’s organic farming network creates opportunities for knowledge sharing, improved farming practices, and potential expansion of the certified organic acreage, further strengthening the supply chain for premium organic products.

ITC’s Recent Acquisition Spree

The ITC 24 Mantra acquisition is part of a broader strategy that has seen the conglomerate make several strategic purchases over the past decade as part of its ITC Next strategy. This approach focuses on inorganic growth through targeted acquisitions that complement the company’s existing portfolio and provide entry into specialized market segments.

Concurrent with the ITC 24 Mantra acquisition announcement, ITC also revealed the acquisition of the remaining 73.5 percent stake in Mother Sparsh Baby Care, which operates in the premium ayurvedic and natural baby care space. This follows an initial 26.5 percent investment made in 2021, illustrating ITC’s phased approach to certain acquisitions.

Future Outlook and Integration Plans

With the ITC 24 Mantra acquisition expected to be completed in the first quarter of 2025-26, the focus will now shift to integration and growth strategies. Founder Raj Seelam’s continued involvement for two years will help ensure knowledge transfer and operational continuity during this critical phase.

ITC is likely to leverage its extensive distribution network and marketing expertise to scale the 24 Mantra brand further in both domestic and international markets. The acquisition aligns with ITC’s focus on premiumization and expansion in health-conscious consumer segments.

The ITC 24 Mantra acquisition represents a significant milestone in ITC’s strategy to diversify its food portfolio and capitalize on the growing consumer preference for organic and natural products. With organic food penetration still at a nascent stage in India, this acquisition positions ITC to capture a substantial share of this expanding market while simultaneously strengthening its international presence.

As health consciousness and sustainability concerns continue to influence consumer choices, the timing of this acquisition appears strategic. The integration of 24 Mantra into ITC’s portfolio adds a distinctive organic dimension to its FMCG offerings, complementing its existing premium food brands and potentially creating cross-selling opportunities across its diverse product categories.

Published on April 19, 2025 | Updated on April 19, 2025