Vahdam (Tea) launches Spices

After 8 years since starting-up VAHDAM® India as an online tea brand, the company has now launched a new category, Spices. The brand has tied-up with Michelin star Chef Vikas Khanna, who has been leading the charge of popularising modern Indian cuisine in the West and making India proud for several years now!

Vahdam was started by Bala Sarda in 2015, a fourth generation entrepreneur who’s family has been involved in tea exports for decades. By per capita, Indians are the largest consumers of tea and India grows the second most quantity of tea after China. India produced 1.2 million tons of Tea in 2022 and the production is expected to grow at a CAGR of 4.5% until 2030. The country exports over Rs. 6,000 Cr (USD 700 mn) worth Tea annually and the domestic market is sized at 13,000 Cr (USD 16 Bn). over 90% of premium Tea produced in India is exported, ironically, as the price conscious Indian market is largely mass-oriented with a majority of consumers preferring low- medium quality of tea varieties for day today consumption at home and outside. An average Indian consumes 0.83 Kg of tea annually.

Coming back to the new launch that is spices, it is quite obvious that the company wants to capitalise on its existing consumer base, half of which are in the US. This is a market that Vahdam has always focussed on, rather than domestic distribution via the traditional kiranas or D2C ecommerce, both of which are highly competitive.

In Sep. ‘21, the company raised Rs. 174 Cr in Series D funding round, with an existing fund raise of Rs. 290 Cr. The FY ‘21 revenue from selling Tea was Rs. 160 Cr and most recent figures have not been shared by the company. Bala Sarda, the company’s Founder had then told Your Story “The pandemic has accelerated our growth, given the shift towards high quality and trusted wellness products, and larger adoption of ecommerce globally. We are excited to have IIFL AMC join our mission of building one of India’s most loved consumer brands in global markets“.

The pandemic has indeed altered consumer spending habits and shopping for tea is among them. A host of D2C brands (read: ecommerce-led) have joined the fray, while the competitiveness factor is far higher on the digital space, due to fewer number of customers than the traditional mom & pop / department stores.