The promoter, however, said the business is not up for an outright sale. “Modern Bazaar is looking for a strategic partner,” said an executive.
Stores see big drop in sales
“A formal announcement of the potential deal could happen as early as this month,” an executive aware of the talks said. “The chain is looking at a valuation of close to ₹100-150 crore, but potential buyers have said they may have to close the deal at a significantly lower valuation.”
The move comes as Modern Bazaar struggles to match the rapid growth of quick commerce and restrain its overhead costs.
“Sales at offline stores have dropped drastically, mainly because of consumer preferences switching rapidly to quick commerce as much for gourmet foods as for daily essentials, and diminishing quality control at the stores,” said another executive aware of the talks.
Multiple vendor payments of suppliers of fresh bakery and frozen foods are also pending, executives said.
ET’s emailed queries to Reliance Retail and DS Group remained unanswered until the publication of this report.
Modern Bazaar owner Kunaal Kumar, also managing director of the chain, confirmed talks for onboarding external investors but said the chain is not for sale.
“We are in active discussions with select strategic investors who can add value and speed to our growth plans,” Kumar, son of the chain’s late founder Vishwant Kumar, said in an email. “A few retailers have approached us for potential collaborations,” he said, adding that “the chain is absolutely not up for sale.”
India’s gourmet foods market is projected to touch annual sales of $24.5 billion by 2034, up from $5.4 billion in 2025, a report by IMARC Group said. A tough business with steep overhead costs, premium gourmet grocery comes with significant challenges to profitability, as high-footfall locations and constant innovation in product assortment are crucial for success, analysts say.
Modern Bazaar currently has 18 large-format premium supermarket stores across Delhi-NCR, Noida and Chandigarh, at plum locations including DLF Cyber Hub. In recent months, the chain has shut down a couple of loss-making stores.
Set up in 1971, the gourmet chain was among India’s first supermarkets selling imported food products from its store at Vasant Vihar, New Delhi, with a large selection of premium imported confectionery, cheeses and condiments, fresh bakery and frozen foods, as well as cold meats and curated vegetables.
Garima Kabra, a resident of Gurgaon, said earlier she used to visit such stores for gourmet food but now quick commerce offers a wide choice.
“Even on the days I visited such stores, I found some of their shelves empty,” Kabra said.
Responding to ET’s query on pending vendor payments, Kumar said, “Settlement cycles are a standard, ongoing part of managing inventory and supply chain operations in a fast-scaling retail business. All accounts continue to be processed as per our regular business cycles.”
In FY25, Modern Bazaar reported revenue of ₹247.24 crore, a 13.6% decline over FY24. Profit was ₹1.43 crore, a decline from ₹2.62 crore in the previous year, regulatory filings sourced from business intelligence platform Tofler India showed. The chain has not updated filings for FY26 yet.
“In the past six months alone, monthly sales have dropped significantly, while liabilities of vendors and suppliers have shot up. Revival will itself be a long haul and require significant funds,” said an industry executive aware of the challenges faced by the chain.
Kumar said Modern Bazaar is rolling out expansion plans “to increase sales by 3X and scale store count to 116 by FY30,” adding that a 15,000 square feet distribution centre in Chhattarpur, Delhi, will go live next month.
Entrants and investors within the gourmet grocery category in recent months include FreshTerra, owned by Elixiir Foods and backed by a nearly ₹82-crore seed funding led by 3one4 Capital. Ashni and Avni Biyani-owned Foodstories, too, raised ₹50 crore from Zerodha cofounder Nikhil Kamath this year in June.
Others such as RP-Sanjiv Goenka group-owned Nature’s Basket isn’t yet profitable, while Future Group’s Foodhall shut down fully by 2023.