IPO Market 2020: After Burger King, another IPO is being launched in December. The IPO of biscuits and bread making company, Mr. Bectors Food, is opening today for investment on December 15. The company aims to raise Rs 540 crore through an IPO. Mr. Bectors Food also supplies Burger King and Macdonald. Money can be invested in an IPO from December 15 to 17. If you are thinking of putting money in this issue after the better performance of the IPO in the past, then you should consider some things first. Know what the experts are advising on the IPO of Mr. Bectors.
SAMCO Securities: Subscribe
Nirali Shah, senior research analyst at SAMCO Securities, says investors can take advantage of listing gains in it. He says that Mr. Bectors Food sells a bakery product named ‘English Oven’ and cookies under the name ‘Cremica’. Both brands are popular. Both brands have a significant stake in North India. PVR supplies Mr Bectors Food to well-known brands such as Burger King and McDonald’s. A significant share of the company’s revenue is also from exports.
The company is also financially strong. The company’s revenue grew by 12 percent CAGR in FY17-19. Whereas Britannia’s revenue grew by 10 percent CAGR during this period. The valuation of Mr. Bectors is still attractive compared to Pierce companies. It is trading at a multiple of 53.9x-54.2x P / E. Britannia is trading at a multiple of 62.3x P / E. So it looks like a good bet for subscriptions. But investors should also take care of risk in it. The company is more dependent on North India for its market. The company is getting tough competition in North India. Currently, the company does not have access to the rural and semi-urban markets.
Angel Broking: Subscribe
Brokerage house Angel Broking says that the domestic biscuits and bakery market is expected to grow at 9 percent in the next few years. On the other hand, the institutional biscuits and bakery market is expected to grow at the rate of 20 percent during this period. In such a situation, Mr. Bectors will benefit further. The company has competition in India from companies like Britannia, Nestle India, Pratap Snacks. However the valuation of Mr. Bectors is attractive. Talking about the IPO, the investors who have a long-term view are advised to subscribe. At the same time, you can also invest in it for listing gains.
How much reserve for
For retail investors: 35 percent
For Qualified Institutional Investors: 50%
For non-institutional buyers: 15 percent
IPO Size and Price Band
The size of the IPO of Mr. Bectors Food is Rs 540 crore. Under this, fresh shares worth 40.54 crore will be issued. At the same time, 500 crore shares will be issued through offer for sale. The price band for Mr. Bectors Food IPO has been kept at Rs 286-288 per share.
At least how much investment
The minimum bid lot for this IPO will be 50 shares. That is, it is necessary to invest in at least 50 shares. For this, at least 14400 rupees have to be applied. The company aims to raise Rs 540 crore through this IPO. The company will expand its business through this fund. At the same time it will also be spent on some casting cast.
The company supplies bakery products. The company named ‘English Oven’ sells bakery products and cookies under the name ‘Cremica’. ITC, Britannia Parle are the company’s main competitors in the country.
The company has 6 manufacturing facilities. Of these, 2 are in Punjab, one in Himachal Pradesh, one in Greater Noida, one in Maharashtra and one in Karnataka. From September 2019 to September 2020, the company’s profit has increased by 282 percent in a year.
SBI Capital Markets, ICICI Securities and IIFL Securities will be the book running lead managers for the IPO. While Link Intime India will be the registrar for this issue.