Mutual Funds Commodities Research Tax Planning IPO Our Team Contact Us    
Google
Web www.equitybulls.com
IPO News

| More

Prabhat Dairy Limited - IPO Note - Angel Broking

Posted On: 2015-08-30 19:33:12

Prabhat Dairy (Prabhat) is an integrated milk and dairy products company catering to institutional as well as retail customers. The company sells its products under retail consumer brands (which account for ~24% of the revenue) as well as ingredient products and co-manufactured products to a number of institutional and multinational companies (accounting for ~76% of total revenue). It procures majority of its milk from milk farmers and registered milk vendors; as of June 30, 2015, its milk collection facilities included more than 450 milk collection centers, over 15 milk chilling plants and over 85 bulk milk coolers with aggregate milk processing capacity of 1.5mn litres per day. The processing and production facilities are located at Shrirampur (Ahmednagar) and at Navi Mumbai. The company has recently added production capacities for several new dairy products including mozzarella cheese, cheddar cheese, processed cheese, cottage cheese (paneer) and shrikhand and has commenced production of these products in FY2016.

Robust milk procurement system: Prabhat has built a strong relationship with local milk farmers, which enables it to procure a large portion of its raw milk requirement directly from milk famers and registered milk vendors. Continuous engagement, knowledge, and infrastructure support have enabled Prabhat to secure supply of quality raw milk and contain procurement costs. Additionally, it has introduced automated milk testing facilities that provide transparency to the pricing of milk purchased by the company.

Shift towards a balanced mix: Historically, institutional sales have accounted for a major chunk of its business. However, this share has declined from 85.4% in FY2013 to 75.8% in FY2015. The company plans to focus on growing its retail consumer business by increasing its marketing expenditure, strengthening its existing brands, and introducing new products and brands amongst others. The new product launches like cheese, paneer and shrikhand have higher margins which will improve its profitability as well as reduce its dependence on the Institutional business.

Outlook and Valuation: Though the company has posted a CAGR of 27.5% and 30.3% in revenue and net profit respectively over FY2012-15, it is still expensive in terms of valuation. On pre-issue outstanding shares, the stock is valued at 47.5x its FY2015 EPS and at EV/EBITDA multiple of 13.7x on the lower end of the price band. Its peer Heritage Foods trades at 29.4x its FY2015 earnings and at EV/EBITDA multiple (FY2015) of 11.4x. Hence on account of higher valuation we recommend to Avoid subscribing to the issue.


Source: Equity Bulls

Click here to send ur comments or to feedback@equitybulls.com





Other Headlines:

Rajnish Wellness Ltd IPO to hit markets on June 25, 2018

Varroc Engineering Limited IPO to open for subscription on June 26, 2018

RITES Limited IPO receives overwhelming response from investors

Fine Organic Industries Limited IPO receives subscription of 8.99 times

Varroc Engineering Ltd - IPO Note - Angel Broking

RITES Ltd - IPO Note - Angel Broking

Fine Organic Industries Ltd - IPO Note - Angel Broking

Avana Logistek Ltd files DRHP with SEBI for IPO

IndoStar Capital Finance Ltd - IPO Note - Angel Broking

IndoStar Capital Finance Limited Offer opens on May 9, 2018

IPO Note - SoftTech Engineers Ltd - Arihant Capital Markets Ltd

Hindustan Aeronautics Ltd to list on March 28, 2018

Expectations high on listing of Bandhan Bank shares tomorrow

Mishra Dhatu Nigam Limited IPO receives subscription of 1.21 times

Lemon Tree Hotels Limited - IPO Note - Angel Broking

Mishra Dhatu Nigam Ltd - IPO Note - Sushil Finance

ICICI Securities Ltd - IPO Note - Sushil Finance

Lemon Tree Hotels Ltd - IPO Note - Sushil Finance

Mishra Dhatu Nigam Ltd - IPO Note - Angel Broking

Mishra Dhatu Nigam Ltd - IPO Note - Avoid - Hem Securities

ICICI Securities Ltd - IPO Note - SSJ Finance & Securities

Mishra Dhatu Nigam Ltd - IPO Note - Subscribe - SSJ Finance & Securities

IPO Note: MISHRA DHATU NIGAM LTD - NOT RATED - Kotak

IPO Note: ICICI Securities Ltd - SUBSCRIBE - Kotak

IPO: Mishra Dhatu Nigam Ltd - IIFL

Sandhar Technologies Limited - IPO Note - Angel Broking

Hindustan Aeronautics LTD - IPO Note - HEM Securities

ICICI Securities IPO to open for subscription on Mar 22, 2018

IPO Note: Sandhar Technologies Ltd - SUBSCRIBE - Kotak

IPO Note: Hindustan Aeronautics Ltd - SUBSCRIBE - Kotak

Bandhan Bank Ltd - IPO Note - Subscribe - HEM Securities

HDFC Asset Management Company Ltd files DRHP for IPO

Bandhan Bank Ltd - IPO Note - Subscribe - SSJ Finance

Bandhan Bank Limited - IPO Note - Angel Broking

IPO of ICICI Securities Ltd to open on March 22, 2018

Bharat Dynamics Ltd - IPO Note - SUBSCRIBE - Kotak

Bharat Dynamics Ltd - SUBSCRIBE - IPO Report - HEM SECURITIES

Bandhan Bank Ltd - IPO NOTE - Arihant Capital Markets

Bharat Dynamics Ltd - SUBSCRIBE - IPO Note - SSJ Finance

Bharat Dynamics Ltd - IPO Note - Angel Broking

Sarveshwar Foods Limited - IPO NOTE - Arihant Capital Markets

H.G. Infra Engineering Ltd - AVOID - IPO Update - SSJ Finance

HG Infra Engineering - IPO Note - Angel Broking

IPO Note - Aster DM Healthcare Ltd - Avoid - By SSJ Finance & Securities

Galaxy Surfactants Ltd - IPO Note - SUBSCRIBE - SSJ Finance & Securities

Shalby Limited - IPO Note - Angel Broking

Future Supply Chain Solutions Ltd - IPO Note - Angel Broking

HDFC Asset Management Company Limited to file for IPO

Reliance General Insurance receives final observations from SEBI for IPO

Srei Equipment Finance Ltd files DRHP for IPO



Website Created & Maintained by : Chennai Scripts
West Mambalam, Chennai - 600 033,
Tamil Nadu, India

disclaimer copyright © 2005 - 2018