ITC to expand cloud kitchen business: ET Report

ITC is set to extend its cloud kitchen venture with plans to penetrate markets in Mumbai, Delhi, and Kolkata, according to ET. ITC, a conglomerate currently offering North Indian lunch and dinner, along with bakery products through food delivery apps, aims to evaluate the inclusion of breakfast and oriental cuisines in its expanding portfolio.

The business model entails a central kitchen and multiple satellite kitchens, aligning with the preferences of delivery platforms like Swiggy and Zomato, which prefer kitchens every 2.5-3 km.

Termed as "food-tech" by the company, this venture is identified as a burgeoning growth vector for ITC. Presently operating three brands—ITC Aashirvaad Soul Creations for North Indian comfort food, ITC Master Chef Creations for North Indian gourmet cuisines, and ITC Sunfeast Baked Creations for bakery products—ITC boasts 19 cloud kitchens in Bengaluru and four in Chennai, all having reached profitability.

The ITC cloud kitchen's average order value is Rs 900, double that of the industry average. Notable distinctions from ITC Hotels' kitchens include a 5% goods and services tax (GST), compared to the 18% GST applicable to hotel restaurants, and a quick-service orientation. Having successfully completed over one million orders, the cloud kitchen business presents considerable potential for growth.

Hemant Malik, the executive director, stated, "We have a winning formula, which includes having established brands that come with certain credibility, cuisine supported by ITC Hotels' chefs, and capabilities of the packaged foods business."