Mrs. Bectors Food Specialities Limited IPO - 10 things you should know

1. One of the leading companies in premium and mid-premium biscuits and premium bakery segments in North India - the Company's biscuit products are sold under the flagship brand "Mrs. Bector's Cremica", and the premium bakery products are sold under the brand "English Oven".

2. The flagship brand "Mrs. Bector's Cremica" is one of the leading biscuit brands in the premium and mid-premium segment in Punjab, Himachal Pradesh, Jammu & Kashmir and Ladakh; "English Oven" is one of the largest selling premium bakery brands in Delhi NCR, Mumbai and Bengaluru.

3. It is one of the only companies that manufactures and markets a wide range of biscuits such as cookies, creams, crackers, digestives and glucose, and a variety of bakery products such as breads, kulchas, buns, cakes and pizza bases. The Company has also launched products such as "sub breads" for DIY sandwiches, and multigrain breads to capitalize on food trends.

4. The Company has a large base of reputed institutional clients due to its stringent quality standards and industry best practices. It is the largest supplier of buns in India to reputed QSR chains such as Burger King, McDonald's, and KFC. It also sells a variety of its bakery and frozen products to cloud kitchens such as Rebel Foods and multiplexes such as PVR.

5. The Company is also one of the leading exporters of biscuits from India, and exports biscuits under its own brand, as well as under third party private labels to more than 64 countries to reputed retail chains and distributors.

6. All the Company's products are manufactured in-house through its 6 strategically located manufacturing facilities, which allows for better quality assurance, standardization, faster product development cycle and better margins.

7. Since the entirety of the Company's product portfolio is classified as "essential goods", the Company was able to continue working through the Covid-19 pandemic and lockdowns with minimal shutdowns. The Company also witnessed an accelerated increase in sale of biscuits and bakery products to retail customers, and an accelerated shift to packaged foods brands in its domestic and exports business.

8. The Indian packaged foods industry is expected to grow at 10.4% to reach INR 2.7tn by 2025. The branded premium and mid-premium biscuits segment is expected to outpace the broader biscuit industry growth over the next few years. This is expected to be driven by the increase in per capita consumption of biscuits and breads, and formalization of the industry.

9. The Company has exhibited EBITDA growth of 84.94% from H1FY20 to H1FY21 due to revenue growth of 18.2% and an expansion in EBITDA margin from 10.71% in H1FY20, to 16.76% in H1FY21. As a result, the Company's has seen its EPS increase from 5.30 in FY20 to 13.56 for H1FY21, and its RoNW expand from 9.52% in FY20 to 19.61% in H1FY21.

10. The Offer consists of a fresh issue of Rs. 41Cr as well as an offer for sale of Rs. 500Cr by the existing PE investors. The proceeds from the fresh issue will be used for financing the project cost towards the expansion of Rajpura facility by establishing a new production line for biscuits.

Source : Equity Bulls

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