ADF Foods to further strengthen the US distribution network

ADF Foods Limited (BSE: 519183, NSE: ADFFOODS) is a leader in prepared ethnic food. In the Company's Board meeting held on August 26, 2021, it was approved that the Company's Wholly Owned Subsidiary, ADF Holdings (USA) Ltd. would be making an investment upto USD 5 mn, which would entail asset purchase and setting up of a step down subsidiary in the United States.

ADF Holdings (USA) Ltd. will have a 70% stake in the share capital of the proposed Step Down Subsidiary. The proposed subsidiary will be a distribution Company and will help the Company move up the value chain. This will further strengthen its penetration and distribution with the retailers with an enlarged product portfolio.

The Company has been investing in building a robust distribution network with uninterrupted supply as a precursor to their increasing capacities. The last quarter, the Company had commenced operations from their leased warehouse of 66,000 Sq. ft. in the US, which serves as a distribution center for the Company. The Company also recently made additions in the senior sales and marketing team.

Commenting on the development, Mr. Bimal Thakkar, Chairman, Managing Director & CEO, ADF Foods Limited said, "We are witnessing strong growth opportunities in our business and thus building our capabilities to tap those opportunities. A strong distribution network is the backbone of a consumer products company, and we are investing aggressively to further strengthen that network. This investment emphasizes our ambition to strengthen ourselves in the US in the long term and to expand our business there. We are sure this investment will bring significant benefits to us both operationally and financially."

Shares of ADF Foods Limited. was last trading in BSE at Rs. 795 as compared to the previous close of Rs. 797.2. The total number of shares traded during the day was 1719 in over 563 trades.

The stock hit an intraday high of Rs. 804.55 and intraday low of 778.95. The net turnover during the day was Rs. 1353007.

Source : Equity Bulls

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