Ashish Kacholia, Asian Paints Promoter Group invests Rs 55 crore in consumer foods brand Yu

Renowned public market investor Ashish Kacholia and Asian Paints Promoter Group (Manish Choksi, Varun Vakil) have invested Rs 55 crore in Yu.

Yu is an omni-channel consumer brand that claims to provide a range of instant food and beverage products using 100% natural ingredients.

Providing exits to seed-stage investors

As part of this Series B funding round, the startup has also provided an exit to some of its seed stage investors who have realised over 4x return on their investment.

The funding comes at a key inflection point for Yu as it looks to ramp up distribution, strengthen its food portfolio, and expand its beverage range with its newly launched 100% fruit juices.

“It is extremely motivating to have raised significant growth capital that too from highly eminent investors. We greatly appreciate their support. Version 2.0 for Yu is now officially underway with the launch of 100% fruit juices – our second product category after instant foods," Founders Bharat Bhalla and Varun Kapur said in a joint statement. 

Purpose of fundraising

With a current annualized revenue run rate of Rs 50 crore, Yu aims to grow revenues 3x over the next two years. The brand is focused on enhanced distribution penetration, new product launches and further category expansion, the release notes.

Yu's offerings

Yu started with instant cup noodles and pastas in 2021 and has since expanded to ready-to-cook noodles, pastas, as well as natural beverages – containing ZERO concentrate or added sugar.

Apart from gaining significant market share in the cup noodles category, the brand is now one of the top players in hakka noodles across all online channels (E-commerce and Quick-commerce).

Yu claims that some of its products, like 100% Whole Wheat Noodles and 100% Coconut Water, have already achieved break-out sales on several distribution platforms, with volumes higher than those of incumbent brands.

This is owing to Yu’s DNA of providing better-for-you products using 100% Natural Ingredients with No Compromise on Taste at Affordable Price Points.

Growing market presence

Yu has developed an omni-channel distribution network with an offline presence in over 7,500 stores across India. The brand is available pan-India on all Q-com (Blinkit, Swiggy Instamart and Zepto) and E-com channels (Amazon, Flipkart Grocery, Dmart Ready) as well as institutional segments (Akasa Air, SpiceJet).

It has also developed South Africa as a key market where its products are now sold across 2,000+ retail outlets.

The brand is witnessing significant business traction having sold more than 1 million units in the month of September 2024.

Yu operates from a 30,000 sq. ft. integrated facility in Gurugram that is UK FSSC 22000 and US-FDA certified with its second facility already in the works. Notably, it has expanded its team to over 200 employees.