La Kheer Deli
Initial Ask – Rs. 50 lacs for 7.5% equity at a valuation of Rs. 6.67 Cr.
About the Company
The company has developed a great variety of Kheer, in different flavours. Kheer is a traditional Indian Dessert, and is loved by Indian’s all around the world. In fact, kheer forms a great part of any India Celebration.
This company has 9 different flavours of kheer, and as per the feedback of the sharks, the taste of the Kheer is really good.
The only problem here is, that the shelf life of the products is only 6 days. This short shelf life is the main hindrance in transportation and storage of the product for resale in retail stores.
However, the Kheer can be taken into Blast Freeze and then stored at a temperature of -18 degrees, which will increase the shelf life of the product to around 90 days.
The Sharks had suggested that the Kheer shall be sold in pre-mixes, which can increase the Shelf Life to around 1 year. However, the company is not currently doing so.
Industry Overview
The Dairy product distribution industry is one of the toughest industry. The normal losses in this industry are huge, thus crumping the gross and finally the net profits of the company. AMUL has mastered this area, incurring a lot of expenses, but without a network like AMUL, it is really difficult for a brand to establish a great distribution network.
Moreover, due to the very short shelf life of dairy products, the transportation becomes more and more difficult. Moreover, due to high numbers of SKU’s the gross profits of the industry are very crunched.
Offers made, and the one accepted:
Anupam offered Rs. 50 lacs for 25%, on the contingency that the company pivots towards Pre-Mixes. This was countered by 15%, which was turned down.