Ahmedabad-based new-age ice cream brand Hocco has concluded a Rs 100 crore ($12 million) fundraise led by its promoter group Chona family and existing investor Sauce VC. The primary capital infusion, at a valuation of Rs 600 crore after the investment, also saw participation from angel investors, including film producers Ritesh Sidhwani and Farhan Akhtar.
In an interaction with ET, Hocco’s managing director Ankit Chona said that the funds will be utilised in expanding the company’s manufacturing capacity. The eight-month-old brand expects to clock Rs 200 crore in revenue in the fiscal year ending March 2025.
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The Chona family, in 2017, sold its legacy brand Havmor to South Korean conglomerate Lotte for Rs 1,020 crore. At the time, Havmor’s annual turnover was estimated to be around Rs 450 crore.
Following this funding, consumer-focused investment firm Sauce VC, which has backed the new-age brands like Mokobara and The Whole Truth, owns around 10% stake in Hocco.
“We started in October last year. We were very bullish but did not expect this kind of response. What we predicted we’d be doing in the second or third year, we’ve ended up doing in the first year. Currently, our plant capacity is between 40,000-50,000 litres a day, and our original projection by May was 15,000 litres. By next summer, we will triple our capacity reaching 1.3 lakh litres a day,” Chona said.
The ice cream industry in India – estimated to be around $5 billion in size this year – has seen a number of new-age brands come up over the last few years.
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These include Noto, Get A Way, Go Zero, Frubon and Minus 30, which are looking to create a space in a market dominated by the likes of legacy players such as Amul, Mother Dairy, Hindustan Unilever’s Kwality Walls and Jaipuria group-owned Cream Bell.
Risk capital investors include DSG Consumer Partners, Jungle Ventures, Saama Capital and Fireside Ventures.
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“The expansion in the ice cream market is a reflection of increasing disposable incomes going towards impulse and indulgence categories. Channels like quick commerce allow a connect to digitally savvy new age consumers who want instantaneous gratification for their sugar craving which was not possible five years ago,” said Manu Chandra, founder and managing partner, Sauce VC.
“Existing brands at this price point are very old and our consumer research revealed that Gen Alpha, Gen Z and even millennials today don’t relate to them,” he said.
ET reported in April that Hindustan Unilever – India’s largest FMCG company – is exploring the option of spinning off its ice cream business, in possible preparation for eventual sale. The category accounts for around Rs 2,000 crore, or roughly 3% of HUL’s sales.
Hocco’s Chona said that the company is looking at quick commerce as an opportunity to expand its business to geographies outside Gujarat – its key territory.
“Right now, our revenue is mainly from Gujarat and a little bit of quick commerce. We started quick commerce in February, and since then our sales on the channel have been doubling every month,” he said.
Overall, Hocco targets to double its sales in FY26, in comparison to what it manages in FY25, Chona said.
“The way we plan to do that is to penetrate deeper into Gujarat and expand into nearby geographies. Before next summer, we will launch in Rajasthan, Maharashtra and Delhi-NCR,” he said.
“Quick commerce is going to be a big disruptor for the ice cream industry. It’s an impulse product, and it satiates the demand through 10-minute deliveries. The only challenge there is that quick commerce platforms carry a lot of brands so you can’t get the depth of SKUs. Nonetheless, it’s a huge opportunity,” he added.
