Bikaji Foods International - IPO - Leading Snacks Player with PAN India Presence

Posted On : 2022-11-03 22:19:30( TIMEZONE : IST )

Bikaji Foods International - IPO - Leading Snacks Player with PAN India Presence

By Mr. Arafat Saiyed - Senior Research Analyst at Reliance Securities.

About the Company

Bikaji Foods International (Bikaji) is one of India's largest snacks brands with business across six major categories: Bhujia, Namkeen, Packaged sweets, Papad, Western snacks and Other snacks (primarily include gift packs, frozen food and cookies). Bikaji has arrangements with various modern retail channels including supermarkets, hypermarkets and retail store chains either directly or through super stockists. The company is coming out with an IPO of Rs8.8bn comprising fully OFS of ~29.4mn shares.

Massive Production Capacity

During 1HFY23, the company sold more than 300 products under the Bikaji brand. During FY22, Bikaji was the largest manufacturer of Bikaneri bhujia with an annual production of 29,380 Tonnes. The company was also the second largest manufacturer of handmade papad with an annual production capacity of 9,000 Tonnes in FY22. Moreover, the company is also the third largest player in the organised sweets market with annual capacity of 24,000 Tonnes for packaged Rasgulla, 23,040 Tonnes for Soan Papdi and 12,000 Tonnes for Gulab Jamun. It is among the fastest-growing companies in the Indian organised snacks market.

Pan-India Network

The company has established market leadership in the core states of Rajasthan, Assam and Bihar with an extensive reach. It has gradually expanded its footprint across India with operations across 23 states and three union territories as of Jun'22. Moreover, the company had 6 depots, 38 super-stockists, 416 direct and 1,956 indirect distributors as of Jun'22. Bikaji has various manufacturing facilities, four of which are located in Bikaner, one in Guwahati and one facility in Tumakuru, held through the subsidiary Petunt Food Processors Pvt, Ltd. to cater to the southern markets in India. It also has a facility in Muzaffarpur held through the other subsidiary Vindhyawasini Sales Pvt. Ltd. to cater to the core market of Bihar.

International Footprint

Bikaji has a major reach in the international markets and sells its Indian snacks and sweets. The company has exported the products to 21 international countries, including North America, Europe, the Middle East, Africa and Asia Pacific representing 3.2% of the sales.


During FY20-22, its revenue and PAT clocked CAGR of 22% and 16% respectively, while EBITDA margin declined marginally from 8.8% in FY20 to 8.7% in FY22. The company reported revenue of Rs16.1bn in FY22, up 23% YoY, while EBITDA decreased to Rs1.4bn in FY22 from Rs1.45bn in FY21. PAT for FY22 declined to Rs760mn, as against Rs903mn in FY21 due to lower operating margin. ROE has declined to 9.3% in FY22 against 14.9% in FY21 and 10.7% in FY20. The company's average debt-to-equity ratio stood at ~0.15x.

Our View

Based on FY22 earnings, the company is valued at 98x P/E, 54.1x EV/EBITDA and 4.7x EV/Sales. The company is well-established and has strong pan-India recognition. It caters to international markets as well and has a diversified product portfolio focused on various consumer segments. In the view of large-scale sophisticated manufacturing with stringent quality standards, extensive pan-India and global distribution network, arrangements with reputed retail chains and growing eCommerce and exports channel, we recommend "SUBSCRIBE" to the issue.

Source : Equity Bulls


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