CX Partners plans exit from Thalappakatti Hotels after seven years
CX Partners is seeking an overall valuation of roughly ₹1,000 crore.
Summary
CX Partners is seeking an overall valuation of roughly ₹1,000 crore.
Private equity firm CX Partners has begun the process of exiting its seven-year-old majority stake in Tamil Nadu-based restaurant chain Thalappakatti Hotels Pvt. Ltd, according to three people familiar with the development.
Advay Capital is advising the company on the deal, which is likely to value the restaurant operator at about 2-3 times its revenue, the people said, adding that it is seeking an overall valuation of around ₹1,000 crore, up from about ₹860 crore in its previous funding round.
“While CX Partners will look to make a complete exit, there could be some purchase of additional stake that will be bought in this new round. The final valuation will depend on the nature of the investor coming in,” one of the people cited above said, adding that it could be a combination of primary and secondary share purchases.
In 2024-25, Thalappakatti Hotels reported a revenue from operations of ₹406.2 crore, compared to ₹340.3 crore a year ago. Its profit widened to ₹7.3 crore from ₹4.4 crore, according to filings sourced by business research platform Tofler from the ministry of corporate affairs.
Mint's queries emailed to Advay, CX Partners, and Thalappakatti remained unanswered.
CX Partners' investment
CX Partners bought a little over a 50% stake in Thalappakatti Hotels for about ₹260 crore in October 2019, making it one of the largest restaurant investments in India at that time. CX has also invested in the casual-dining chain Barbeque Nation, the quick-service restaurant (QSR) operator Sapphire Foods, and the food-ingredients maker Cremica.
The investment was a mix of a secondary purchase of shares along with a primary component to facilitate the expansion plans. About two years later, the restaurant operator raised another round, led by Tree Line Investment Management, alongside other public and private investors, including the family office of the Indian conglomerate Havells Group, which valued the company at about ₹860 crore.
Founded in 1957 in Dindigul, Tamil Nadu, by Nagasamy Naidu, the company began as Anandha Vilas Biriyani Hotel before rebranding as Thalappakatti Hotels, which operates the Dindigul Thalappakatti brand. It is known for its signature Dindigul-style biryani, made with seeraga samba rice and hand-ground spices, distinguishing it from the Hyderabadi and Lucknowi styles.
It is currently run by third-generation entrepreneur Nagasamy Dhanabalan, who serves as the managing director for the restaurant chain. Over the years, the brand has scaled to over 100 outlets across India, predominantly in the Southern region, and has served more than a million customers, according to its official website.
It competes with other players such as Samara Capital-backed Paradise Biryani, Anjappar, and Nandhana Palace, which is also in the process of raising capital from private equity funds.
Rising investor interest
The rise of online food delivery and branded dine-in formats has attracted investor interest in India's restaurant and quick-service restaurant (QSR) sector. Mint reported earlier this month that Adyar Ananda Bhavan’s plans to raise capital from Bodhi Tree Systems in a ₹3,000 crore deal, and that global private equity firm Invus Group was nearing a ₹500 crore minority stake in Bengaluru-based restaurant chain Popo Ventures.
Inspira Global acquired Restaurant Brands Asia Ltd (RBA), the operator of Burger King in India and Burger King and Popeyes in Indonesia. Private equity firm Siguler Guff also invested $40 million in Trimex Foods Pvt. Ltd, the exclusive Indian franchise partner for global brands such as Chili's Grill & Bar, PAUL and Cinnabon, earlier this year.
Mint also reported on Truffles' private fundraising plans, Subway India's proposed public listing, and Bengaluru-based The Filter Coffee raising capital from the family office of the Bikaji promoter.
The country's $80-billion food services market is projected to grow at a 10-11% compound annual growth rate (CAGR) through 2030, driven by the rapid expansion of organized players.
Source: Livemint — Companies
