Baba Food Processing LTD. India IPO: Review, Valuation & GMP

Baba Food Processing India Limited - Complete Overview

Established in 2015, Baba Food Processing India Limited primarily focuses on the production of high-fiber Whole Wheat Atta (Wheat Flour), Refined Flour (Maida), Tandoori Atta, and Semolina flour (Sooji). 

The company's manufacturing facility is located in Ranchi and is currently seeking to expand its business operations in India by establishing a new manufacturing unit in Patna, Bihar. The company has introduced its product lines under the brand names "Panchakanya" and "Bhajan" for marketing purposes.

Baba Food Processing India Limited markets and sells its products in the regions of Jharkhand, Odisha, and West Bengal. The company employs over 120 individuals and reports annual sales of 1900 million.

 

What does the company do?

Baba Food Processing India Limited is an agro-food manufacturing company.

 

Company Products 

Baba Food Processing India's product range encompasses a variety of items, including Whole Wheat Atta (Wheat Flour), Refined Flour (Maida), Tandoori Atta, Semolina flour (Sooji), and many more.

 

 

IPO Overview 

The Baba Food Processing India IPO date is scheduled to open from November 3, 2023, to November 7, 2023, with the SME IPO expected to be listed on November 16, 2023. 

The Baba Food Processing India IPO price has been established in the range of Rs. 72 to Rs. 76 per share, and the company aims to raise Rs. 33.00 Crores from this upcoming SME IPO.

Notably, the company has allocated 2% of the shares for institutional investors, 29% for non-institutional investors, and the remaining 69% for retail investors.

 

Baba Food Processing India Limited IPO timetable (Tentative)

Events	Date
IPO Opening Date	3 November 2023
IPO Closing Date	7 November 2023
IPO Allotment Date	10 November 2023
Refund initiation	13 November 2023
IPO Listing Date	16 November 2023

 

Baba Food Processing India Limited IPO Details 

IPO Opening & Closing Date	3 November to 7 November 2023
Face value	Rs. 10 per Share
Issue Price	Rs. 72 to Rs. 76 per Share
Lot Size	1600 Shares
Price of 1 lot	Rs. 121,600
Issue Size	4,342,105 Shares (aggregating up to Rs. 33.00 Cr)
Offer for Sale	NA
Fresh issue	4,342,105 Shares (aggregating up to Rs. 33.00 Cr)
Listing at	NSE SME
Issue Type	Book Built Issue IPO
Registrar	Link Intime India Pvt. Ltd.

 

Baba Food Processing India Limited IPO Lot Details 

Minimum Lot Investment (Retail)	1 Lot
Maximum Lot Investment (Retail)	1 Lot
Minimum Lot Investment (HNI)	2 Lot

 

 

Baba Food Processing India Limited IPO Reservation

Institutional Share Portion	2%
Non-institutional Share Portion	29%
Retail Share Portion	69%

 

Company Financial

Amount in Lakhs

Period	31 Mar 2023	31 Mar 2022	31 Mar 2021
Total Assets	6,811.54	5,467.80	4,583.95
Total Revenue	18,964.17	9,756.30	10,769.55
PAT	503.44	201.26	198.14
Net worth	2,499.97	1,996.53	1,648.95
Reserve & Surplus	2,019.97	1,516.53	1,168.95
Total Borrowings	3,266.54	2,766.60	2,325.45

 

Revenue Earned from the Company through institutional manufacturers, modern traders, dealers, wholesalers and retailers 

(Amount in Lakhs)

Particulars	31 Mar 2023	31 Mar 2022	31 Mar 2021
Institutional Manufactures	2,707.46	1,241.81	555.11
Modern Traders	346.31	124.88	55.82
Dealers	3,524.66	2,205.79	2,553.62
Wholesalers	4,580.77	2,695.66	2,847.25
Retailers	6,260.29	3,442.96	4,444.49
Trading	1,534.44	-	198.81
Total	18,953.93	9,711.10	10,655.10

 

Product-wise Revenue Bifurcation

Particulars	31 Mar 2023	31 Mar 2022	31 Mar 2021
Whole Wheat Atta (Wheat Flour)	4,472.00	2,817.74	4,110.36
Refine Flour (Maida)	7,823.27	4,223.24	3,871.35
Semolina flour (Sooji)	774.20	504.15	437.16
Tandori Atta	426.13	173.57	-
Wheat Bran (Choker)	3,559.44	1,938.03	1,719.69
Waste Dust	19.56	9.66	10.09
Trading Goods (Chickpea Flour (Besan) and Roasted Gram Flour (Sattu))	1,815.25	0.38	504.10
Waste Bags	59.95	44.33	2.35
Job Charges	4.14	-	-
Total	18,953.94	9,711.10	10,655.10

 

Objective of the Issue

The company intends to use the Net Proceeds from the Issue for the following purposes:

• Making an investment in our wholly owned Subsidiary, Panchakanya Foods Private Limited ("PFPL"), to establish a modern and highly automated roller flour mill and chakki whole wheat atta mill in Patna, Bihar, which is referred to as the "Project."
• Financing the acquisition of machinery for the production of Chickpea Flour (Besan) and Roasted Gram Flour (Sattu) within our existing manufacturing facility in Ranchi.
• Meeting the working capital requirements of the company.
• Prepaying or repaying a portion or all of certain outstanding unsecured borrowings obtained by our company.
• Addressing general corporate needs and purposes.

 

Promoters and Management of Baba Food Processing India Limited

Yogesh Kumar Sahu is the promoter of the company.

Pre-issue Promoter Shareholding	99.99%
Post-issue Promoter Shareholding

 

Peer Comparison

Below are the listed peers of Baba Food Processing (India) Limited

Name of the company	EPS (Rs.)	P/E Ratio	Revenue from Operations (Rs. in Lakhs)
Baba Food Processing (India) Limited	4.20	-	18,953.95
Megastar Foods Ltd	10.08	30.62	30,420.31

 

IPO's Valuations

With Baba Food Processing India IPO Price falling within the range of Rs. 72 to Rs. 76 per share and an EPS of 4.20. To evaluate the IPO valuation the P/E ratio, when considering the upper price of the issue, amounts to 18.09.

 

Dividend Policy 

According to the Baba Food Processing India IPO DRHP, the company has not made dividend payments in the past, and any future dividends will be contingent upon the company's financial performance.

 

IPO's Strengths 

• Extensive distribution network and a strong presence in numerous retail channels.
• A varied range of products in the portfolio.
• Established relationships with both clients and suppliers.
• Rigorous quality assurance and control measures for the products.
• The manufacturing facilities are strategically situated, feature modern infrastructure, and are designed for integrated production with a central emphasis on quality.
• Efficient sourcing methods and the advantage of strategic location.
• A seasoned management team with a track record of successful project management and implementation.

 

IPO Weaknesses 

• A significant portion of our revenue relies on our dealers, wholesalers, and retailers.
• Occasional delays have occurred in the submission of required forms as per the reporting obligations outlined in the Companies Act, 2013 to the Registrar of Companies (RoC).
• The company is obligated to obtain, renew, or maintain its statutory and regulatory licenses, registrations, and approvals.
• There have been instances of delays in remitting statutory dues, such as GST, by the Company.
• The operations of the company take place within a competitive business environment.
• The Promoter, Directors, and Key Managerial Personnel of the company have vested interests in the Company beyond reimbursement of expenses or standard remuneration and benefits.
• Adherence to strict food safety, consumer goods, and health and safety laws and regulations may result in increased liabilities and greater capital expenditures.

 

 

IPO GMP Today

The Latest GMP of Baba Food Processing India IPO is Rs. 30

 

Conclusion  

The company operates within a competitive business sector but has demonstrated strong financial performance and is actively pursuing expansion opportunities in the future. These factors serve as positive indicators for the company. Experienced investors may consider allocating their funds to this offering after conducting a thorough evaluation.

 

 

Finowings IPO Analysis

Hope you enjoyed the Finowings IPO Analysis. We tried our best to give every required detail about the company that you should know before applying to the IPO. 

You must consult your financial advisor before making any financial decisions. 

To Apply for the IPO, Click Here.

 

To Read the Prospectus of the Company Click Here to Download the DRHP.

 

 

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