Quick-service restaurant chain Wow! Momo on Tuesday forayed into the fast-moving consumer goods market with a range of frozen ready-to-eat momos. The Tiger Global Management-backed company plans to launch more categories of frozen foods in the coming months, while also introducing sauces and condiments.
The company is targeting annual revenue of ₹500 crore over the next five years from its packaged foods business, and ₹1,000 crore from the food services or restaurant business, said Sagar Daryani, co-founder and CEO, Wow! Momo, in an interview.
Launching momos as frozen food—ready to eat in 2-3 minutes—follows the growing popularity of momos, made ubiquitous by roadside kiosks.
Wow! Momo is seeking to tap a growing trend of in-home snacking that has led food companies to launch more frozen foods and bite-size snacks. The pandemic and ensuing lockdowns shifted food and beverage consumption to in-home in a big way.
Wow! Momo has partnered exclusively with online retailer BigBasket to sell its momos in 10 cities, besides tying up with large trade stores such as Modern Bazaar in Delhi-NCR.
Demand for ready-to-eat food has tripled for companies such as ITC and McCain Foods in the past year, said Daryani.
Momos are the entry point for Wow! Momo into the FMCG market with more products such as spring rolls, frozen samosas and a range of condiments and sauces in the pipeline. “We want to own the entire steamed foods category, including idlis," he said.
Daryani said the trend towards in-home snacking, especially during the pandemic, led the company to advance its product launch by a year. “Our intent was to allow consumers to make momos in less time and the work-from-home phenomenon had helped us speed this up," he said. His plan is to expand to 200 cities by next year.
The company, which runs Wow! Momo and Wow! China restaurants, has launched Wow! Momo Sales Pvt. Ltd for its latest FMCG venture.
Venture capital firm Lighthouse Funds is also an investor in the restaurant business.
Wow! Momo entered the market in 2008-09 at a time when the market was highly unorganized. It sells half a million momos through 350 restaurants across 15 cities.
Of the total, 291 outlets are operational currently.
Daryani said the company is looking at a fundraise for further expansion.
“We are definitely looking for another larger round sometime around December this year. And maybe a couple of more funding rounds prior to our aspirations of going for an IPO (initial public offering) in the next few years. We require funds for growth. For us, profitability is not an issue," Daryani said.
The funds will be used to scale up marketing and capacity for the FMCG business and investing in new product development, he added.
