Shares of a food processing company zoomed 5 percent on Wednesday’s early trades to reach a record high of ₹ 509.00 apiece on the National Stock Exchange (NSE) after it reported more than doubled its profit for the June quarter (Q1FY24) of the financial year 2023-24.
Bikaji Foods International is the third largest ethnic snacks company in India, with a product range including bhujia, namkeen, packaged sweets, papad, as well as other snacks.
On a consolidated basis, the company reported a 163.76 percent increase in its net profit to ₹ 41.41 crores, as compared to ₹ 15.70 crores in the corresponding quarter last year. Its revenue climbed 15.10 percent to ₹ 481.69 crores in the latest quarter as compared to ₹ 418.51 crores in the June quarter last year.
Bikaji Foods has also announced its plans to directly cater to 2.4 lakh retail stores in FY24. In another development, the Jaipur bench of the National Company Law Tribunal has directed the snack maker to hold meetings with its equity shareholders and unsecured creditors for the approval of the Scheme of Amalgamation with Hanuman Agrofood Pvt.
“We remain committed on strengthening our distribution network to achieve a deeper distribution across our core and focus markets and on track to expand our direct reach to 2.4 lakh retail stores by FY24,” said Deepak Agarwal, Managing Director of Bikaji Foods.
With a market capitalization of ₹ 12,081crores, Bikaji Foods is a small-cap company. It has a low return on equity of 14.49 percent and an ideal debt-to-equity ratio of 0.18. Its shares were trading at a price-to-earnings ratio (P/E) of 94.23, which is significantly higher than the industry P/E of 23.85, indicating that the stock might be undervalued as compared to its peers. The stock has risen nearly 60 percent since its listing on the bourses in November last year.
The company’s promoters hold a 75.37 percent stake in it, followed by retail investors with 8.82 percent, mutual funds with 8.26 percent, foreign institutions with 5.46 percent and other domestic institutions with 2.09 percent.
Written by Simran Bafna
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