Bikaji Foods shares rise 6% to hit new 52-week high after 'Bhujialalji' stake acquistion
Shares of Bikaji Foods surged about 6 per cent to Rs 451 on Wednesday, commanding a total market capitalization of more than 11,000 crore.
- Jul 19, 2023,
- Updated Jul 19, 2023 10:35 AM IST
Shares of Bikaji Foods International surged about 6 per cent during the early trading session on Wednesday after the ethnic snackmaker announced to acquire a significant stake in Bhujialalji Private Limited. The company informed about the same through an exchange filing. Bikaji Foods has acquired a stake of 49 per cent in equity shares and 396 compulsorily convertible debentures (CCDs) in Bhujialalji Private Limited on July 19, 2023, said the exchange filing. "Subsequent to the acquisition, Bhujialalji Private Limited has become an associate of the company," it added. Following the acquisition announcement, shares of Bikaji Foods surged about 6 per cent to Rs 451 on Wednesday, before giving up its gains partially. The company was trading at Rs 440.65 at 10 am, commanding a total market capitalization of more than 11,000 crore. The scrip had settled at Rs 426.35 on Tuesday. Bikaji Foods have purchased 9,608 equity shares with a face value of Rs 10 each at an issue price of Rs 5,100 apiec amounting to Rs 4.9 crore, while it has bought 396 CCDs with same face value and same issue price amounting to Rs 0.2 crore. The total cash consideration for the deal is done at Rs 5.1 crore. Shares of Bikaji Foods International were listed at the bourses in November 2022, when the company raised a little more than Rs 881 crore from the primary stake sale, which was entire an offer-for-sale (OFS), by selling its shares in the range of Rs 285-290 apiece. The stock is around 50 per cent up from its issue price of Rs 300. Bhujialalji Private Limited was incorporated on May 28, 2021 with an annual turnover of Rs 18.08 crore and a net worth of Rs -3.03 crore as on March 31, 2023 The BPL belongs to fast moving consumer goods (FMCG) industry with 'Bhujialalji' as the brand name. For the financial year ended on March 31, 2023, the Bhujialalji Private Limited reported a total revenue of Rs 18.08 and incurred a net loss of Rs 2.67 crore. The company had clocked a total revenue of Rs 1.97 crore with a net loss at Rs 0.36 crore in the year ago. Bikaji is a strong play on the fast-growing savory snacks market and ticks all the right boxes to succeed, including a strong lineage, a diversified portfolio, strategically located manufacturing setup and a strong brand recall and lends strong pricing power, said Axis Capital, which recently initiated coverage on the stock. "Initiatives to augment capacities and drive distribution expansion coupled with RM tailwinds/PLI benefits are likely to help it sustain a strong growth and improvement in RoIC to 25 per cent," it added with a 'buy' rating and a target price of Rs 500 on the stock based on 46 times June 2025E EPS in its maiden report on the stock.
Shares of Bikaji Foods International surged about 6 per cent during the early trading session on Wednesday after the ethnic snackmaker announced to acquire a significant stake in Bhujialalji Private Limited. The company informed about the same through an exchange filing. Bikaji Foods has acquired a stake of 49 per cent in equity shares and 396 compulsorily convertible debentures (CCDs) in Bhujialalji Private Limited on July 19, 2023, said the exchange filing. "Subsequent to the acquisition, Bhujialalji Private Limited has become an associate of the company," it added. Following the acquisition announcement, shares of Bikaji Foods surged about 6 per cent to Rs 451 on Wednesday, before giving up its gains partially. The company was trading at Rs 440.65 at 10 am, commanding a total market capitalization of more than 11,000 crore. The scrip had settled at Rs 426.35 on Tuesday. Bikaji Foods have purchased 9,608 equity shares with a face value of Rs 10 each at an issue price of Rs 5,100 apiec amounting to Rs 4.9 crore, while it has bought 396 CCDs with same face value and same issue price amounting to Rs 0.2 crore. The total cash consideration for the deal is done at Rs 5.1 crore. Shares of Bikaji Foods International were listed at the bourses in November 2022, when the company raised a little more than Rs 881 crore from the primary stake sale, which was entire an offer-for-sale (OFS), by selling its shares in the range of Rs 285-290 apiece. The stock is around 50 per cent up from its issue price of Rs 300. Bhujialalji Private Limited was incorporated on May 28, 2021 with an annual turnover of Rs 18.08 crore and a net worth of Rs -3.03 crore as on March 31, 2023 The BPL belongs to fast moving consumer goods (FMCG) industry with 'Bhujialalji' as the brand name. For the financial year ended on March 31, 2023, the Bhujialalji Private Limited reported a total revenue of Rs 18.08 and incurred a net loss of Rs 2.67 crore. The company had clocked a total revenue of Rs 1.97 crore with a net loss at Rs 0.36 crore in the year ago. Bikaji is a strong play on the fast-growing savory snacks market and ticks all the right boxes to succeed, including a strong lineage, a diversified portfolio, strategically located manufacturing setup and a strong brand recall and lends strong pricing power, said Axis Capital, which recently initiated coverage on the stock. "Initiatives to augment capacities and drive distribution expansion coupled with RM tailwinds/PLI benefits are likely to help it sustain a strong growth and improvement in RoIC to 25 per cent," it added with a 'buy' rating and a target price of Rs 500 on the stock based on 46 times June 2025E EPS in its maiden report on the stock.