Freshara Agro Exports IPO: Review, Valuation, Date & GMP

Freshara Agro Exports IPO-Complete Overview

Freshara Agro Exports IPO under the SME IPO category is a book-built issue of Rs.75.39 crore by Freshara Agro Exports Limited (formerly Freshara Picklz Exports). The company was founded in 2015 and imports, prepares, and ships pickled commodities, including preserved gherkins, from India to several international destinations.

The company exports raw produce from nearby farmers in Tamil Nadu, Karnataka, and certain regions of Andhra Pradesh through a contract farming program. Approximately 70% of the produce is considered ‘not ready to eat’ and is sent straight to manufacturers for additional processing and completion into final goods. The remaining 30%  is given to merchants and brokers of food on the global market. Pickled veggies such as jalapenos, baby corn, and gherkins are among the products offered by the company.

The company prepares and exports pickled vegetables in three distinct packaging categories as of March 31, 2024. The specifics of the three types of packaging: 

1) Industrial packing in drums suitable for food grade.

2) Food packaging in plastic buckets and tin cans.

3) Retail packaging in glass jars and tin cans.

The Food Safety and Standards Authority of India (FSSAI), the US Food & Drug Administration (FDA), Star-K Kosher, the Agricultural and Processed Food Products Export Development Authority (APEDA), International Featured Standards, and the Brand Reputation through Compliance Global Standard (BRCGS) are just a few of the prestigious organizations that have granted the company accreditation.

This Freshara Agro IPO will start on 17 October 2024, and this ‘initial public offering’ will end on 21 October 2024.

Freshara Agro Exports IPO Overview

The Rs.75.39 crore new SME IPO comprises a wholly fresh issue of 64.99 lac Shares. 

This upcoming IPO date is from October 17 to October 21, 2024. Freshara Agro Exports IPO price is Rs.110 to Rs.116 for each Share. 

The expected IPO listing date is Thursday, 24 October 2024, and listing at NSE and SME.

If You want to apply for the IPO, Click Here to Open a Demat Account.

Company Financial

The company’s revenue grew by 56% and PAT increased by 140% during FYs ending 31 March 2024 and 31 March 2023.

(Amount in Lac)

Revenue Bifurcation

The revenue bifurcation for various activities is shown below:

(Amount in lac)

 

Category-wise Revenue Breakdown  

(Amount in lac)

 

Revenue Breakdown from Top 5 Countries

(Amount in lac)

 

Geography-wise Revenue Breakdown  

(Amount in lac)

 

The Objective of The Issue

The company desires to use the Net Proceeds from the Issue to fulfill its following goals:

• The working capital requirements.

• To cover the issue costs.

• To meet the capital expenditure.

• General corporate purposes.

 

Peers of Freshara Agro Exports Ltd.

There are no listed companies in India engaged in the same business of comparable size and financials.

 

Evaluation

The Freshara Agro Exports Limited share price is Rs.110 to Rs.116 for each Share.

Evaluation of P/E Ratio

Considering the FY ended 31 Mar 2024 with an EPS of Rs.5.86 from the last year, the resulting P/E ratio is 19.79x.

Considering the weighted EPS of Rs.3.75 for the last three years, the P/E ratio is 30.94x.

Comparative Analysis With Listed Peers

The average P/E Ratio of the industry is NA.

 

IPO's Strengths 

• A good rapport with other suppliers and contract farmers to guarantee raw material availability during the off-season.

• The ability to maintain a smooth supply chain allows it to forge enduring, meaningful connections with its clients.

• Its goods' quality assurance and control, for which it has been recognized with numerous honors and accreditations.

• State-of-the-art internal processing facilities with an emphasis on affordability.

• Its extensive product line allows it to provide global client service.

• A scalable company plan and a track record of financial success.

• A management group and promoter with experience.

 

IPO’s Weaknesses

• Reliance on particular geographic areas for the supply of raw materials.

• Fewer products are available than those of bigger rivals.

• Changes in regulations impacting the food export sector.

• Crop yields are being impacted by climate-related risks.

• Fierce rivalry in the international food export industry.

 

Freshara Agro Exports IPO GMP Today

Freshara Agro Exports IPO GMP is Rs.50 as of 15 October 2024. With a price of Rs.116 per Share, the estimated IPO listing price is Rs.166 when writing this information.

IPO Timetable (Tentative)

The IPO opening date is from October 17 to October 21, 2024, with allotment on October 22, refund initiation on October 23, and listing on October 24, 2024.

 

Freshara Agro Exports IPO Details 

The IPO with a Face Value of Rs.10 per share offers a total issue size of 6,499,200 Shares (Rs.75.39 Cr).

Freshara Agro Exports IPO Lot Details 

The Freshara IPO allows retail investors to invest in a minimum and maximum of 1 Lot (1200 Shares) amounting to Rs.1,39,200 and in multiples thereof, while for HNI investors, the minimum Lot is 2 (2400 Shares) amounting to Rs.2,78,400.

 

Freshara Agro Exports IPO Reservation (% of Net Issue)

 

Promoters And Management of Freshara Agro Exports Ltd.

• Mr. Junaid Ahmed.

• Mr. Iqbalahmed Khudrathullah Mohammed.

• Mrs. Asma Syed.

 

IPO Lead Managers

• GYR Capital Advisors Private Limited.

Dividend Policy

The company has not paid dividends in the last three FYs.

Conclusion

The company is 100% EOU for agricultural products, mostly pickles sold in international markets. This company is specifically into pickled vegetables, gherkins being a constituent part of it. Questions are surfacing on the sudden increase in margins with FY23. A serious cause of concern arises since it has a 2.77 debt-to-equity ratio as of September 30, 2024.

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.

Disclaimer: 

The content is purely for educational and information purposes only. We do NOT encourage/advise/suggest our active readers to be involved in any kind of buying or selling securities activities. Always consult your eligible financial advisor for investment-related decisions. The author does NOT through this blog intend to involve readers in trading.  

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