The share price of this FMCG firm surged by 2.5 percent to an intraday high of Rs 342.75 per share on Friday after the company acquired a 67 percent stake in Omkar Chemical Industries Private Limited (OCIPL).
Share price movement:
With a market capitalization of Rs 337.70 crores, the shares of Adani Wilmar Limited surged around 1.05 percent at 2:07 pm, trading at Rs 337.60 apiece on Friday’s afternoon session. The shares of this company generated both negative returns of 16 percent over the past year and 9 percent over the past 6 months.
What happened:
According to Adani Wilmar Limited’s stock exchange filings, the company announced that it has entered into a share subscription and share purchase agreement by acquiring a majority stake of 67 percent in Omkar Chemical Industries Private Limited (OCIPL) by paying an Enterprise Value of Rs 56.25 crores.
Why this matters:
This acquisition helps Adani Wilmar Limited to increase its presence in the specialty chemical industry. The authorized share capital of OCIPL is Rs 3.15 crores and the paid-up share capital is Rs 3 crores.
The time period of the acquisition is expected to be completed within 3 to 4 months. OCIPL is involved in carrying out the business of manufacturing, formulating, and processing all kinds of chemicals and chemical compounds, gels, downstream ingredients, and other by-products. OCIPL recorded a turnover of Rs 13.95 crores in 2023-2024.
Financials:
Reviewing the financials of Adani Wilmar Limited on a year-on-year basis, the revenues declined by 12 percent from Rs 58,186 crores in FY23 to Rs 51,262 crores in FY24. In the same time frame, the net profits also decreased from Rs 582 crores to Rs 148 crores, demonstrating a 74.5 percent fall
Ratios:
In terms of return ratios for the year 2024, it has reported a return on equity (ROE) of 3.36 percent and a return on capital employed (ROCE) of 11.94 percent. It has also reported a debt-to-equity ratio of 0.26 times for the same year.
EBITDA and Sales volume:
The EBITDA of Adani Wilmar Limited fell by 32 percent from Rs 1,661 crores in FY23 to Rs 1,135 crores in FY24. The sales volume grew by 10 percent from 5.57 MT in FY23 to 6.02 MT in FY24.
Domestic market revenue and capacity utilization:
In the domestic market, the branded products revenue has been growing at 30 percent plus YoY for the past 10 quarters. The edible oil capacity utilization stood at 52 percent in FY23 compared to 60 percent in FY24.
Shareholding Pattern:
As of March 2024, Adani Wilmar Limited shareholding pattern stood at 87.87 percent for promoters, 11.07 percent for the public, 0.77 percent for foreign institutional investors, and 0.29 percent for domestic institutional investors.
About the Company:
Adani Wilmar Limited (AWL) is a joint venture between Adani Group of India and Wilmar Group of Singapore. The company has a diversified product portfolio offering most of the primary kitchen essentials, including edible oil, wheat flour, rice, pulses, besan, and sugar, with market-leading positions across products. The company was incorporated in the year 1999.
Written By Zahal
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