Annapurna Swadisht IPO Review (NSE SME)

Annapurna Swadisht IPO (NSE SME) i coming out with issue of 4,322,000 equity shares of the face value of ₹10 aggregating up to ₹30.25 Crores. Annapurna Swadisht Limited is a manufacturer of snacks and food products, namely, Fryums, cakes, candy, namkeen, chips and Gohona Bori. Annapurna Swadisht Limited sells more than 12 Lakh packets of products daily. In Annapurna Swadisht IPO HNI Investors will get allotment in proportionate basis & now the new mainboard IPO allocation for HNIs

Bidding date15th – 19th Sep 2022
Issue Size  30.25
Issue Size  (Shares)43,22,000
Face Value10
Bid Lot shares2000
Price Band68-70
Issue Structure :
QIB50%
NIB15%, 6.48 Lac shares
Retail35%,  15.12 Lac shares
Lead ManagerCorporate Capital Ventures
RegistrarSkyline Financial Service 
HNI Investors will get allotment in proportionate basis & now the new mainboard IPO allocation for HNIs
Annapurna Swadisht IPO Review: Video in Presentation form

About Annapurna Swadisht

  • Annapurna Swadisht started operations in 2016.
  • Promoted by Mr. Ritesh Shaw,Mr. Shriram Bagla.
  • Annapurna Swadisht Ltd is a FMCG player and a growing impulse packaged snack companies in Eastern India.
  • Company is manufacturer of snacks and food products, namely, Gohona Bori, Fryums, cakes, candys and namkeen.
  • It operates over 35 SKUs comprising extruded snacks , pellet-based snacks,potato snacks, namkeens, candies, and cakes
  • Has a two manufacturing unit, located at Asansol , Siliguri. Both operated at 100% capacity utilization
  • Products are marketed under our own brand names Jackpot, Chatpata Moon, Balloon, Finger, Rambo, Makeup Box, Dhamaka, Phoochka, Jungle Adventures, Ringa, Bachpan Ka Pyaar, Kurchure, Cream Filled Cake Vanilla, Cream Filled Cake Litchi, Cream Filled Cake Mix Fruit, Cream Filled Cake Orange, Cream Filled Cake Chocolate, Mixed Fruit Flavoured Cake, Chocolate Flavoured Sliced Cake, Pluss, Malai Pop, Imly Pop, Coconut Crunch, Kaju Candy, Coffico, Masala Teekha, Salted Chips, Paprika Spices, Tomatina Classic, American Cheese, Gram Gathiya, Gram Chana Jor, Crispy Diet Chidwa, Gram Bhawnagri Sev, Gram Badam Pokora And Gram Masala Muri.

Anchor Book: Annapurna Swadishtk IPO

  • Annapurna Swadisht has raised  Rs 8.61 crore from anchor investors.
  • The company has allotted 12,30,000 equity shares to three anchor investors.
  • The Anchor Investors are
    •  Rajasthan Global Securities Private Limited
    •  Authum Investment and Infrastructure Limited
    • NAV Capital VCC – NAV Capital Emerging Star Fund

The shares have been allotted at an issue price of Rs 70 per share

Annapurna Swadisht IPO: Financials

Particulars / INR CrQ1FY23FY22FY21FY20
Revenue28.9961.0520.2913.74
EBITDA2.235.141.480.77
PAT1.312.410.510.34
share capital11.54  
Post Issue share Cap15.64
FV in Rs.10
IPO price70
EPS  post IPO annualaized3.35  
PE20.9
Market Cap Rs. Cr.110
Market Cap / Sales1.79

Annapurna Swadisht: Salient Points

  • Issue constitutes 26.32% of the post-issue paid-up capital of the company.
  • Multiple marquee investors, led by market veteran and Founder of First Global Shankar Sharma, invested in personal capacity.
  • Amit Bhartia, erstwhile Partner, GMO Singapore Pte, has invested in his personal capacity. He is a portfolio manager for GMO’s Emerging Markets Equity team and oversees fundamental research.
  • Institutional investors, NAV Capital Emerging Star Fund and Rajasthan Global Securities have also invested in the pre-IPO.
  • Pre IPO shares were given at considerable discount to current IPO price.

Concerns

  • Exposed to Palm oil rate fluctuations
  • Dissemination of info in SME IPOs is poor
  • Significant ramp up in June 22 numbers

Annapurna Swadisht IPO: Assessment

  • Company looks poised to grow its market share in the years to come.
  • Revenue has grown from Rs 11.67 crore in FY19 to Rs 61.04 crore in FY22.
  • net profit has increased from Rs 0. 28 crore Rs 2.40 crore in this period.
  • In June 2022, Annapurna Swadisht reported monthly sales of INR 11.05 crore .
  • Annapurna Swadisht has Rs 3.47 crore of long-term borrowing on March 22. Its debt-equity ratio is 1.26.
  • Annapurna Swadisht caters to rural areas and faces little threat from largeplayers.
  • Company is going for aggressive distributor network growth
  • The company recently forayed into the Direct-to-Customer (D2C) segment with the Olonkar range of products and has tied up with bigbasket for distribution
  • Three year CAGR Revenue growth at 111%.
  • Annapurna Swadisht is expanding the Siliguri facility with Pre-IPO funds.
  • This should grow revenues on completion.
  • Annapurna Swadisht is valued at a P/E of 20.9x based on annualized Q1FY23 earnings.
  • Buzz is huge in SME issues at this moment.
  • Even poor companies getting good subscription & Listings.
  • GMP reported on various platforms is 80-90% above issue price.
  • All SME IPOs including this one is only for investors that have a high risk appetite.
  • Iam likely to apply in Annapurna Swadisht IPO on last day.

Annapurna Swadisht IPO: Apply or Not

  • Risk  :  Moderate ( risk in SMEs is generally high)
  • Listing Gains  :   Reasonable to Good Listing.  Current GMP is quite high
  • Hold for Medium/Long Term:  Looks ok, but I prefer is to be out of SME on day1
  • Subscription  :  Expected to be High across all categories
  • I will apply in this IPO on last day, Monday.
  • Above are my views only. Please do your own diligence.

Standard disclaimer: I am not a SEBI registered analyst and above analysis is for educational purpose only. Iam a postgraduate in engineering & Management . Also Certified in some exams like NISM-Series-V-A: Mutual Fund Distributors Certification, NISM-Series-X-A: Investment Adviser (Level 1) Certification and NISM-Series-X-B: Investment Adviser (Level 2) Examination. This post is my view on the subject matter and is only academic and exploratory in nature. It is not meant to influence investment decisions of investors. I may have bias/vested interest in covered Stock/Mutual Funds/NCD etc. due to my own investment or leaning. Further my understanding of the areas on which I write may be imperfect or incomplete and data could be wrong due to limited time and resources at my disposal. Please do your own due diligence as stock market/MF investments have high degree of inherent risk.

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