ITC is set to expand the cloud kitchen business, spreading out in Chennai. The company which sells North Indian lunch and dinner and bakery products through food delivery apps has been testing the business in Bengaluru.
According to an ET report, along with setting up cloud kitchens in Chennai, ITC is also planning to venture into Mumbai, Delhi and Kolkata. Currently, there are 19 kitchens in Bengaluru and four kitchens in Chennai. The cigarettes-to-hotel conglomerate is also likely to add breakfast and oriental cuisines, ITC’s executive director Hemant Malik told ET.
The average order value for ITC cloud kitchens is twice that of the industry, amounting to Rs 900. The difference between these kitchens and hotel kitchens also lies in the goods and services tax (GST) they involve. While it is 5 percent for cloud kitchens, hotel restaurants involve 18 percent GST.
ITC forayed into cloud kitchen, which includes a central kitchen and various satellite kitchens in cities it operates in, with three of its brands, Master Chef Creations for North Indian cuisines, Aashirvaad Soul Creations North Indian comfort food and Sunfeast Baked Creations for bakery products.
The company has built a portfolio of packed foods across categories like staples, spices, biscuits, confectionary, gums, snacks, noodles and pasta, beverages, juices, chocolate, coffee, frozen foods and ready-to-eat foods. Cloud kitchen is the recent addition to its portfolio.
A cloud kitchen uses a commercial kitchen for food preparation for delivery, with no dine-in facility. These enable restaurants to either expand an existing restaurant or start a virtual brand.
The Indian cloud kitchen market, amounting to $800 million in FY22, is expected to reach $1.9 billion by FY26 as per Wazir, a consultancy firm.