Prataap Snacks Ltd

SIX CRORE IN DEBT, ONE HUNDRED SQUARE FEET TO WORK WITH

The Man Who Had Failed Three Times Borrowed Fifteen Lakh and Tried Again

By the early 2000s, Amit Kumat had already failed at business three times in six years. The costliest of those failures was a chemical manufacturing venture that left him roughly ₹6 crore in debt, a sum that would have persuaded most people with a master's degree from the University of Southwestern Louisiana to go find a salaried job and never look back. Kumat, instead, went home to Indore and asked his family for one more loan.

In 2002 he borrowed ₹15 lakh — not from a bank, which would not have touched him, but from relatives who had already watched him fail once. He was joined by his younger brother, Apoorva Kumat, and a family friend, Arvind Mehta, and the three of them settled on an unglamorous idea: snack food, specifically the cheese balls sold in small towns across central India, a segment no big company had bothered to brand or scale.

The company they started, Prakash Snacks, operated out of a 100-square-foot room in Indore with three employees. There was no factory floor to speak of, no cold chain, no national distributor on the phone — just a rented room and a decision that this attempt could not be allowed to fail the way the last one had.

When it came time to sell in 2004, Kumat made a call that looked irrational on paper. Instead of the nearby town of Mhow, just 25 kilometres from the plant, he chose to launch in Delhi — 866 kilometres away — because the empty trucks that had carried Maruti and Hyundai cars down to Indore were driving back to Delhi empty, and their drivers would carry his cartons of cheese balls north for a fraction of normal freight. It was the first sign of the instinct that would define the company: find the arbitrage nobody else is using.

Amit Kumat

Managing Director & CEO · Prataap Snacks Ltd (Yellow Diamond)

A postgraduate of the University of Southwestern Louisiana, Kumat had already failed at three ventures before starting Prakash Snacks with ₹15 lakh borrowed from family in 2002. He has run the company he founded ever since, and in 2026 was reappointed Managing Director and CEO for a further five years.

SELLING INTO DELHI FROM 866 KILOMETRES AWAY

A Small-Town Brand Walked Into a Market PepsiCo Already Owned

Delhi in 2004 was not an empty shelf waiting for Yellow Diamond. PepsiCo's Lay's had the manufacturing scale and marketing budgets of a multinational, Haldiram's carried a century of household trust, and ITC and DFM Foods's Crax already held the distribution relationships Kumat needed. A company running out of a 100-square-foot room in Indore, selling a brand nobody in the capital had heard of, had none of that leverage.

The company nearly died in Delhi, undercut and out-muscled by rivals with budgets a hundred times its size.

Retailers had no reason to give shelf space to an unknown label when established brands already delivered reliably and paid better margins on the same square inch of counter. Kumat's only real lever was price and quantity — he could not out-advertise Lay's, so survival meant making sure that whichever packet a shopkeeper did stock, Yellow Diamond's gave the customer visibly more for the same five-rupee coin.

ONE HUNDRED CARTONS WRITTEN OFF TO ASSAM

The Product That Died in Delhi Found a Second Life States Away

In 2006, Kumat took direct control of production and opened the company's own potato-chips manufacturing line in Indore rather than relying on contract manufacturers. The following year he placed the company's first-ever advertisement — a ₹5 lakh print notice in a national daily, inviting distributors and super-stockists in Pune to apply. It drew exactly one applicant, a reminder of how far the company still had to travel before its name meant anything outside its home market. By FY12, revenue had reached ₹172 crore, and Sequoia Capital made its first investment in the business — the first outside institutional money to back the Kumat brothers' bet on small-town India.

The real break, though, came from a product that was supposed to be a write-off. Prataap tried to take on DFM Foods's Crax in the rings category in Delhi, packing a small plastic toy into every ₹5 pack. It flopped. Rather than absorb the loss quietly, Kumat shipped roughly 100 unsold cartons to a distributor in Assam with instructions to sell them or throw them away — Delhi's rejects, dumped on a market nobody had built a plan for.

Assam did not reject them. Demand for the toy-filled rings packs was strong enough that the company had to build two new manufacturing plants in consecutive years just to keep up, turning the Northeast into a stronghold the national players had largely ignored. Salman Khan signed on as brand ambassador in 2016, and by September 2017 the company was ready for the market it had spent thirteen years chasing: its initial public offering, priced at ₹930-938 a share, was oversubscribed 47.39 times.

THIRTY GRAMS IN A FIVE-RUPEE PACK

Underpricing Lay's Only Works if the Rest of the Business Can Absorb It

Yellow Diamond's core pitch to a price-conscious shopper was arithmetic, not branding: where a rival's ₹5 packet held around 22 grams, Yellow Diamond's held closer to 30. For a company that could not win on marketing spend, giving away more product for the same coin was the only lever left to pull.

That arithmetic only works at scale, and scale is what Prataap built next. The company now runs 15 manufacturing facilities — eight owned outright and seven on contract — spread across Indore, Rajkot, Kolkata, Guwahati and beyond, feeding a network of roughly 1,500 super-stockists and more than 5,200 sub-distributors that between them reach close to 2.5 million retail outlets, many of them small-town and rural stores that a multinational finds expensive to service directly.

That density is the real moat, not the Yellow Diamond name. Prataap has held the number-one position in the rings category for close to a decade and led the extruded namkeen category too — segments a larger rival could enter with more money, but not with a cheaper cost-to-serve in a Tier-3 town where Prataap already has a van on the road every week.

NINE YEARS SINCE THE OPENING BELL

A Business That Kept Growing Revenue While Losing, Then Finding, Its Profit

Revenue climbed from ₹1,397 crore in FY22 to ₹1,725 crore in FY26, a steady if unspectacular climb through a stretch of sharp raw-material inflation in edible oil and packaging film.

Profit told a rougher story. Net profit had reached ₹53 crore in FY24 before commodity inflation pushed the company to a ₹34 crore net loss in FY25. FY26 brought a turnaround — operating EBITDA up 68% year-on-year to ₹82 crore, a return to a ₹10 crore net profit, and the board proposing a 10% dividend, the first sign in two years that the cost pressure was easing.

SEPTEMBER 23, 2026

The Founder Just Got Five More Years to Run a Company He No Longer Controls

In September 2024, Sequoia Capital's India arm — by then renamed Peak XV Partners, and Prataap's largest institutional backer since that first FY12 investment — sold its entire 46.85% stake for ₹846.6 crore. The buyers were Authum Investment & Infrastructure and investor Mahi Madhusudan Kela, in a deal that triggered a mandatory open offer and, over the following months, made Authum the company's new promoter.

Ownership changing hands after twelve years of private-equity backing is usually where a founder's story ends, not where it turns a new page. It did not play out that way here. Announcing results shortly after the deal, Kumat said the company would "seek to build a collaborative partnership with the new shareholders that further enriches Prataap's position and strategic depth, with the objective of generating even greater value creation for all stakeholders in the years ahead." Two years later, in August 2026, the board went further: it approved reappointing Amit Kumat as Managing Director and CEO, and his brother Apoorva as Executive Director, for a further five years effective September 23, 2026 — a vote of continuity from an owner that could just as easily have brought in its own management.

The same board meeting cleared a ₹16.5 crore acquisition of RLOP Food Processing to deepen the company's supply chain, and endorsed reclassifying members of co-founder Arvind Mehta's family from promoter to public shareholders, reshaping the ownership register even as day-to-day control stays with the Kumats. The most recent quarter gave the new arrangement an early scorecard: Q1 FY27 revenue rose 20% to ₹490 crore and net profit jumped 257% to ₹2.47 crore, with management now targeting double-digit revenue growth for the full year.

BACK TO THE HUNDRED-SQUARE-FOOT ROOM

What Twenty-Four Years of Underpricing Lay's Actually Teaches

Financial figures are sourced from publicly available information and may not reflect the most recent reporting period. This is a story, not investment advice — please verify all data independently before making any financial decision.