Reliance Consumer Acquires D2C Snacking Startup TagZ Foods for INR 28 Cr in Distress Sale

• ByStartupStory     |    November 14, 2024

Reliance Consumer Products, a wholly-owned subsidiary of Reliance Retail, is set to acquire direct-to-consumer (D2C) snacking startup TagZ Foods for INR 28 Cr (approximately $3.5 Mn). The deal, which appears to be a distress sale, could undergo a change in size following due diligence, as disclosed in a regulatory filing. Both Reliance Consumer and TagZ Foods declined to respond to questions about the acquisition at the time of publishing this story, as reported by Inc42.

Founded in 2019 by Anish Basu Roy and Sagar Bhalotia, TagZ Foods is an omnichannel snacking brand known for its popped potato chips, gourmet dips, and cookies. It distributes products through its website, popular e-commerce platforms, and offline retail stores. The brand has raised a total of $3.2 Mn across several funding rounds since its inception, with its latest undisclosed funding round coming from former Indian cricketer Shikhar Dhawan, who subsequently joined as TagZ’s brand ambassador. Prior to this, TagZ raised $2 Mn in a pre-Series A funding round led by 9 Unicorns and $1.2 Mn in its seed round from angel investors in 2020. Other investors include Venture Catalysts and Klub.

Earlier sources reported that the D2C brand had ceased production in recent months due to difficulties scaling operations, which led to a shortage of its products on e-commerce platforms and in retail outlets. These issues reportedly prompted several employees to exit the startup.

TagZ’s acquisition follows a challenging financial period. The startup reported a net loss of INR 10.7 Cr against an operating revenue of INR 9.6 Cr for the fiscal year 2023. It competes with brands like BRB, Too Yum, Lays, and Uncle Chips in the snacking industry.

The acquisition of TagZ Foods aligns with a broader trend of D2C brands being acquired by fast-moving consumer goods (FMCG) giants as the D2C sector in India continues to expand. Recently, other notable acquisitions include ITC’s purchase of Yoga Bar in January 2023 and Hindustan Unilever’s acquisitions of Oziva and Wellbeing Nutrition in 2022.

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