India's Pet Care Boom Draws New Investors
As many as 71 domestic pet-care product firms were founded in the last two years, according to Tracxn data.
Investments into India's tiny pet care market rose in a tough economic climate as more people adopted animals during the pandemic.
The Indian pet care industry attracted $56.4 million in investments in 2021, up from $40.8 million in 2020, according to data from Tracxn. In 2022, the industry has seen inflows of $17.4 million so far.
Investor attention is focused on growing demand for high quality nutrition and alternatives for our furry companions. The market is now worth $434 million, according to Euromonitor data.
As many as 71 domestic firms were founded over the last two years to cash in on the surge in pet ownership, the Tracxn data shared with BQ Prime revealed.
Fast-moving consumer goods companies such as Emami Ltd. and Nestle India Ltd. are among the latest to join the fray.
Last month, Emami announced plans to invest in the pet-care startup Cannis Lupus Services India, which offers Ayurvedic remedies for pets under the brand Fur Ball Story. Just days ago, Nestle India announced the acquisition of the pet foods business from its subsidiary Purina Petcare India for Rs 123.5 crore.
Pet care is among the highest growing category now and has an "exciting future", Suresh Narayanan, chairman and managing director at Nestle India, said during an earnings call. Today, there are an estimated 30 million pets in the country and it is growing at 11% per annum, he said.
"Portfolio expansion in fast-growing segments like wet cat food" and expansion beyond tier-1 towns with the help of e-commerce platforms are expected to play a big role in accelerating growth," Narayanan said.
India is "one of the fastest growing pet care markets" in the world, according to Salil Murthy, MD of Mars Petcare India, a division of global confectionery major Mars Inc. that sells brands such as Pedigree, IAMS, and Whiskas.
He attributes the growth to factors such as rising income, nuclear families and increasing awareness about the nutritional needs of pets, which are not met by human food.
"A number of people during the Covid-19 lockdown filled their emptiness by adopting a pet. This trend during the pandemic saw a rise in demand not only from metros but also from Tier-II and Tier-III cities," Murthy said.
Flurry Of Deals
Among other recent deals, Delightful Gourmet Pvt., the operator of meat brand Licious, had in April invested $1 million in fresh pet food startup Pawfectly Made.
The Delhi-based pet tech startup Sploot raised $500,000 in May as part of its seed funding round led by Info Edge (India) Ltd.-backed Redstart Labs (India) Ltd.
In 2021, Bollywood actor Deepika Padukone participated in a $2.6-million funding round of digital pet care platform Supertails.com. Other investors in the platform include Saama Capital, DSG Consumer Partners, Titan Capital, Sauce VC and Whiteboard Capital.
Some of the other companies that were founded over the last two years include Furfam, PetsAdopto, Pawzpace and Dogskart.
The pet care products stock the shelves of super-specialty stores like Heads Up For Tails, traditional retailers such as DMart and Reliance Retail, as well as the increasingly important online channels like Amazon and D2C platforms Pawsindia, Petshopindia, Pupkart, PetsWorld and Chew Central.
Scope For Growth
The Rs 4,000-crore pet care market in India is growing at a fast clip but is at a nascent stage compared to evolved markets. The domestic industry had over 15% year-on-year growth in the past decade and is estimated to reach Rs 10,770 crore by 2025, according to Euromonitor.
At least 804 pet care companies were founded globally in the last two years, according to data from Tracxn. The industry attracted investments worth $993.7 million in 2021, up from $696.4 million in 2020, from the likes of Sequoia Capital to SoftBank Group Corp.
Between January and July this year, investors have poured in $408.9 million, of which private equity investments were $218.5 million, according to Tracxn.