Reliance acquires TN heritage food brand Udhaiyam, deepens FMCG push

Reliance Consumer Products Ltd (RCPL), the FMCG arm of Reliance Industries, has acquired a majority stake in Chennai-based Udhaiyams Agro Foods Pvt Ltd, bringing the Tamil Nadu heritage staples and “nutrition” brand into its growing branded foods portfolio.

The transaction has been structured as a joint venture, with RCPL holding a majority stake while the founding promoters of Udhaiyams retain a minority shareholding and continue to manage day-to-day operations. Reliance did not disclose the financial terms of the deal.

Udhaiyams is one of Tamil Nadu’s most recognisable packaged food brands, with a strong presence in pulses, flours, rice products and edible oils, and a reputation built over decades on affordability and nutritional positioning. Industry estimates put the company’s annual revenue at over Rs 600 crore, with particularly deep penetration in southern markets through kirana stores and regional distributors.

Fits Reliance’s strategy of scaling regional brands

Reliance’s approach is consistent across categories. In beverages, it acquired Campa in 2022 and relaunched Campa Cola, Lemon and Orange as mass-market value offerings, while also buying a 50% stake in Gujarat-based Sosyo Hajoori Beverages to revive and scale the nearly century-old regional soft-drink brand beyond western India.

In confectionery and biscuits, Reliance has taken a 51% stake in Lotus Chocolate, acquired legacy candy brands such as Ravalgaon and Toffeman, and partnered with Sri Lanka’s Maliban to manufacture and sell biscuits in India. Across these deals, the strategy mirrors Udhaiyam: pick up trusted regional franchises, plug them into Reliance’s manufacturing, distribution and pricing engine, and scale them into national brands. “This partnership with Udhaiyam is a strategic step in strengthening our staples portfolio,” RCPL said in its statement announcing the transaction, adding that the brand has “significant potential to expand beyond its home market.”

RCPL director T Krishnakumar, in a statement, described Udhaiyam as “a brand that needs no introduction in Tamil Nadu” and said Reliance intends to “scale it up nationally.” Udhaiyams’ Managing Director S Sudhakar said the joint venture would allow the company to accelerate growth while retaining its regional identity and manufacturing base.

Building an FMCG house through legacy brands

The Udhaiyam deal is the latest in a series of acquisitions through which RCPL is assembling a diversified FMCG portfolio spanning staples, beverages, confectionery and personal care — often centred on long-standing Indian brands rather than new-to-market launches.

Earlier this year, RCPL acquired Velvette, a heritage personal-care brand historically associated with affordable hair-care products and sachet-led distribution in South India. The deal marked Reliance’s clearest step yet into soaps, shampoos and daily-use personal products, a category dominated by multinationals and long-established Indian players.

Velvette’s inclusion matters because it takes RCPL beyond food and beverages into personal care, a higher-margin category where strong brands, wide distribution and competitive pricing play a crucial role. In packaged foods, Reliance has bought SIL, a 75-year-old sauces and condiments brand, which it plans to modernise and expand nationally.

These additions broaden RCPL’s portfolio beyond core pantry staples, reinforcing its strategy of building a diversified FMCG business anchored in established Indian brands and scaled through Reliance’s retail and supply-chain network.

Diversification and reinvestment capacity

Analysts say such acquisitions help the group’s diversified earnings, particularly the group's ability to fund new consumer businesses without relying on short-term profitability.

Morgan Stanley analysts said the parent group, Reliance, has been helped by the broader business mix, which “underlines the stability of Reliance’s core cash-generating engines.” Analysts also said the strength of Reliance’s energy and telecom cash flows allows the group to invest aggressively in newer verticals such as consumer products and retail, “absorbing longer gestation periods and upfront brand-building costs.”

Market watchers said this framework helps explain RCPL’s acquisition-led strategy. “Rather than chasing immediate margins, Reliance appears willing to prioritise market share, distribution depth and portfolio breadth, particularly in staples and daily-use categories where scale can eventually translate into pricing power,” said an analyst.

Leveraging regional trust into national reach

For Udhaiyam, the tie-up offers access to capital, procurement efficiencies and a national distribution network that would be difficult to replicate independently. For Reliance, it adds a deeply trusted regional nutrition brand at a time when consumers are increasingly price-sensitive but brand-conscious in staples.

Under the joint venture structure, the existing promoters of Udhaiyams Agro Foods will continue to remain involved in the business, with Managing Director S Sudhakar and co-promoter S Dinakar retaining a minority stake. Reliance said the arrangement combines RCPL’s scale with the founders’ “more than 30 years of experience in the staples category and in scaling the packaged pulses business.” By keeping the founding team in place while taking a majority stake, Reliance is positioning the acquisition as an expansion of an established operating model rather than a wholesale integration, a structure it has used across several of its consumer-brand tie-ups.

On Friday afternoon trading session, Reliance Industries, the parent of RCPL, was trading around Rs 1,560 on the NSE, up modestly near recent highs and well above its 52-week lows, reflecting broader investor confidence in the group’s diversified growth strategy.