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biryani: Hyderabad: PE fund laps up iconic Paradise biryani chain | Hyderabad News
HYDERABAD: Paradise, an iconic Hyderabadi biryani brand, whose aroma since 1953 has wafted all over India and even abroad, has now changed hands with Mumbai-based private equity player Samara Capital lapping up almost all the promoter stake in the company.
Samara Capital, which made its first investment of Rs 70 crore in Secunderabad-based Paradise Food Courts in 2014, had over the years upped its stake to 49% with a total investment of about Rs 200 crore till 2020 and recently acquired a chunk of the 51% stake, that was remaining with the promoters, at around Rs 562 crore.
According to sources, the original promoter of Paradise – Ali Hemati — now owns only about 1% stake in the company which is the only thread connecting the chain to its Hyderabadi roots now. Hemati, however, will continue to be the chairman emeritus of Paradise Food Courts and have oversight of and provide mentorship to the management team, that shifted gears to a professionally run one after Gautam Gupta was roped in as CEO in 2016 by Samara Capital.
Paradise’s story began in 1953 when Hussain Hemati and Ghulam Hussain set it up as a small canteen-cum-café at Paradise cinema theatre in Secunderabad. From a single outlet biryani joint, Paradise began spreading its wings after the current promoter Ali Hemati took over its reins from his father in 1978 as its popularity grew.
In 2014, when Samara Capital entered the picture, Paradise was only a six-outlet chain with even its office being operated out of the main Secunderabad restaurant. With the PE firm on board, soon things began to gather steam. Paradise shifted its corporate office to a separate building close to the first outlet and a professional CEO was brought in.
Today, the iconic brand has about 50 outlets in 13 cities across six states and with a PE player at the helm it is now looking at a rapid scale-up with about 100 outlets on the radar by the end of 2022 and even an international foray over the next two years.
Pointing out that biryani is a very attractive and scalable category, Nilay Pratik, vice president, Samara Capital said: “Paradise is the category leader and the most well known brand in biryani & offers the best and the most authentic Hyderbadi biryani with a strong value for money proposition, quick service, digitally enabled delivery and takeaway and true Hyderabadi provenance. Combined with a scalable format, this has made the brand ready for an accelerated expansion.”
According to Paradise Food Court Pvt Ltd CEO Gautam Gupta, the biryani chain is looking at 10X growth in Indian market with plans to grow to 500 restaurants across 100 tier-1 and 2 cities by 2026-27.
So what else has changed at Paradise over the years? For one, sources pointed out that the professional management has been able to crack the scale-up formula by cutting dependence on chefs thanks to automation. “The holy grail lies in breaking the dependence on chefs to shift to automation, which is oven-based dum cooking, that nobody does in India except Paradise. That’s the breakthrough achieved in the last one year, making it ready for scale-up,” said a source.
According to the source, this was also one of the reasons the chain had expanded at a slow pace despite the takeover by a professional management but now with the back-end completely set up and the cooking process automated, it is stepping on the gas. Also, apart from an omnichannel approach that straddles dine-in, home delivery and take away, the new management has focused on cutting down the size of outlets, which were earlier sprawling restaurants, to a smaller, modular format with about 30-40 covers of dine-in along with takeaway and home delivery or just the take-away and home delivery outlets.
Samara Capital, which made its first investment of Rs 70 crore in Secunderabad-based Paradise Food Courts in 2014, had over the years upped its stake to 49% with a total investment of about Rs 200 crore till 2020 and recently acquired a chunk of the 51% stake, that was remaining with the promoters, at around Rs 562 crore.
According to sources, the original promoter of Paradise – Ali Hemati — now owns only about 1% stake in the company which is the only thread connecting the chain to its Hyderabadi roots now. Hemati, however, will continue to be the chairman emeritus of Paradise Food Courts and have oversight of and provide mentorship to the management team, that shifted gears to a professionally run one after Gautam Gupta was roped in as CEO in 2016 by Samara Capital.
Paradise’s story began in 1953 when Hussain Hemati and Ghulam Hussain set it up as a small canteen-cum-café at Paradise cinema theatre in Secunderabad. From a single outlet biryani joint, Paradise began spreading its wings after the current promoter Ali Hemati took over its reins from his father in 1978 as its popularity grew.
In 2014, when Samara Capital entered the picture, Paradise was only a six-outlet chain with even its office being operated out of the main Secunderabad restaurant. With the PE firm on board, soon things began to gather steam. Paradise shifted its corporate office to a separate building close to the first outlet and a professional CEO was brought in.
Today, the iconic brand has about 50 outlets in 13 cities across six states and with a PE player at the helm it is now looking at a rapid scale-up with about 100 outlets on the radar by the end of 2022 and even an international foray over the next two years.
Pointing out that biryani is a very attractive and scalable category, Nilay Pratik, vice president, Samara Capital said: “Paradise is the category leader and the most well known brand in biryani & offers the best and the most authentic Hyderbadi biryani with a strong value for money proposition, quick service, digitally enabled delivery and takeaway and true Hyderabadi provenance. Combined with a scalable format, this has made the brand ready for an accelerated expansion.”
According to Paradise Food Court Pvt Ltd CEO Gautam Gupta, the biryani chain is looking at 10X growth in Indian market with plans to grow to 500 restaurants across 100 tier-1 and 2 cities by 2026-27.
So what else has changed at Paradise over the years? For one, sources pointed out that the professional management has been able to crack the scale-up formula by cutting dependence on chefs thanks to automation. “The holy grail lies in breaking the dependence on chefs to shift to automation, which is oven-based dum cooking, that nobody does in India except Paradise. That’s the breakthrough achieved in the last one year, making it ready for scale-up,” said a source.
According to the source, this was also one of the reasons the chain had expanded at a slow pace despite the takeover by a professional management but now with the back-end completely set up and the cooking process automated, it is stepping on the gas. Also, apart from an omnichannel approach that straddles dine-in, home delivery and take away, the new management has focused on cutting down the size of outlets, which were earlier sprawling restaurants, to a smaller, modular format with about 30-40 covers of dine-in along with takeaway and home delivery or just the take-away and home delivery outlets.
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