India: Nestlé takes minority stake in Drools to fuel $1B growth journey

A leading Indian pet food company has secured the backing of a global powerhouse to help it continue growing in major markets.

Nestlé has confirmed that it has acquired a minority stake in Drools Pet Food, headquartered in Chhattisgarh in central India. The investment is purely financial, and no terms are being disclosed, but the 2 firms have stressed that Drools will continue to operate independently.

“Backed by science-based nutrition, strong retail and e-commerce reach and robust manufacturing capabilities, we remain deeply committed to delivering quality pet nutrition with love and care,” the Indian company says in a LinkedIn post announcing the Nestlé investment.

The Swiss conglomerate’s statement only references the parent company. Some previous high-profile pet industry investments have been made through its Nestlé Purina subsidiary, although these, such as Lily’s Kitchen and Tails.com, have been majority stakes.

Unicorn ambition

Drools Pet Food was founded in 2010 and raised $60 million (€53M) in 2023 from investment firm L Catterton. The company plans to boost marketing, distribution and partnerships with retailers.

Last year, the firm debuted on the ASK Private Wealth Hurun India Future Unicorn Index 2024, a listing of firms likely to become unicorns – a valuation of $1 billion (€870M) or more – within 3 years.

Drools’ CEO, Dr. Shashank Sinha, says the company is actively working toward unicorn status by 2027, telling GlobalPETS that it is focusing on product innovation, market expansion and reaching new partnerships to continue its “growth trajectory.”

Export markets

According to Drools, they are India’s largest exporter of pet food.

In 2023, the company said that export markets would become a priority. Its reach beyond India includes major markets in the Middle East, Africa and Asia Pacific, including Saudi Arabia, Australia, Qatar, Oman and Iran, with planned expansion into South Korea, the Philippines, Uganda and Kenya, among others.

Drools also claims a 40% market share and has the country’s largest manufacturing facility with 6 locations.

The player faces increased competition from one of India’s largest fast-moving consumer goods companies, Godrej Consumer Products Limited, which recently entered the pet care business. The company announced its plans to expand its footprint into the pet industry last year and recently launched a pet care brand called Godrej Ninja under Godrej Pet Care (GPC).

Drools’ product lines include wet and dry food, treats and supplements for dogs and cats, plus cat litter. They are sold in 40,000 retail outlets in 22 countries.