Curefoods, the Bengaluru-based cloud kitchen company known for brands such as EatFit, CakeZone, and its recently acquired Krispy Kreme franchise, has received the go-ahead from the Securities and Exchange Board of India (Sebi) for its highly expected Rs 800 crore initial public offering. The IPO will consist of both a fresh issue and an offer-for-sale (OFS) of up to 4.85 crore shares, providing an exit opportunity for several early investors. Founder and CEO Ankit Nagori will not be selling any shares, demonstrating continued leadership commitment to Curefoods and its vision.
Key Shareholders Trim Stakes, Iron Pillar Tops Seller List:
Among those selling shares in the IPO are marquee investors Iron Pillar, Crimson Winter, Accel, Chiratae Ventures, and Curefit Healthcare. Iron Pillar leads with plans to offload 1.91 crore shares, followed by Crimson Winter at 97.6 lakh, Accel at 45.7 lakh, Chiratae at 36.6 lakh, and Curefit at 12.8 lakh. Iron Pillar also stands to benefit the most from the offering, with an IPO exit value approximately 2.6 times higher than Accel and Chiratae, based on acquisition prices. The investor spread highlights significant early-backer confidence but also a shift as venture funds realize returns on initial investments.
Utilization of IPO Funds and Expansion Plans:
Curefoods plans to use Rs 152.5 crore of the Rs 800 crore issuance to build more cloud kitchens and infrastructure as part of its network expansion. A further Rs 92 crore is set aside for its fully owned subsidiary Fan Hospitality, which handles the back-end kitchen operations, and another Rs 126.9 crore will be used for loan repayment and prepayment. In addition, the business plans to spend Rs 14 crore on marketing and Rs 40 crore on leasing deposits. Curefoods also has the option to raise Rs 160 crore through pre-IPO placement, which could result in a corresponding reduction in the new issue component.
Positive Market Outlook for Curefoods IPO:
Industry analysts and investors are closely watching Curefoods’ upcoming IPO, citing optimism due to its rapid revenue growth and dominant positioning in the cloud kitchen landscape. As a fast-growing player with a diversified brand portfolio and aggressive acquisition strategy, Curefoods is expected to capitalize on India’s increasing demand for online food delivery services. However, potential investors remain cautious about the company’s continued losses, high employee attrition, and dependence on third-party delivery platforms. The IPO’s success will likely hinge on Curefoods’ ability to show a sustainable path to profitability while expanding its operational footprint and market share in an increasingly competitive sector.
Strong Revenue Growth But Ongoing Losses, Operational Challenges:
Curefoods has nearly doubled its revenue in two years, posting Rs 746 crore in FY25 compared to Rs 382 crore in FY23, showcasing rapid growth in the cloud kitchen segment. Despite strong top-line expansion, the company remains loss-making, with a net loss of Rs 170 crore in FY25, largely flat year-on-year. Notably, EBITDA losses have been narrowed considerably from Rs 276 crore to Rs 58 crore over the same period, signaling improved operational efficiency. Curefoods’ ongoing cash burn is highlighted by the fact that it still costs Rs 1.27 for every rupee earned. Due to the company’s heavy reliance on delivery platforms Swiggy and Zomato, which account for 82.2% of revenue, high employee churn is still a major risk, with attrition sitting at 111.73% in FY25. Curefoods may also be exposed to changes in platform fees and commissions that further reduce margins.
