In September 1998, stock market followers were surprised when the scrip of Tasty Bite Eatables Limited (TBEL), a small Ready-to-Serve (RTS)1 food company, reached Rs. 36. This was a 930 percent increase over its 1996 price of Rs. 3.50. What was even more surprising was the fact that till September 1998, TBEL was a Board for Industrial and Financial Reconstruction (BIFR)2 case.

Launched in the early 1990s, TBEL products were rejected by Indian consumers. Analysts said that the products had been launched "ahead of their time" in the Indian markets. (TBEL products were made available in a pouch, which had to be boiled before serving.)3 Moreover, the fact that the products were priced very high added to their lackluster performance.

However, TBEL not only became the first Indian company to get itself de-registered from BIFR within a year, it also emerged as the largest brand in the US ethnic foods market. In 1999, the company posted its first ever profit of Rs. 4.71 mn.

TBEL was formed in 1986 by Ravi Ghai (Ghai) and Ravi Kiran Aggarwal. Ghai was also the owner of the ice-cream brand Kwality, which was the market leader with a market share of over 50 percent. TBEL set up a unit to process 10,000 tonnes per annum (tpa) of frozen vegetables and 5000 tpa of RTS foods at Khutbao and Bhandgoan villages of Maharashtra at a cost of Rs. 55.5 mn. In February 1987, TBEL brought a public issue of Rs. 7.5 mn. The company commenced production in February 1989 and launched its first RTS products in 1990. Following a lukewarm response in the Indian markets, in 1991, TBEL introduced its products in the Middle East, Russia, and the US. The company did not fare well in these markets either. The lack of a focussed marketing approach was considered to be the main reason for its failure.

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