About Neopolitan Pizza and Foods Limited

Neopolitan Pizza And Foods Limited operates in two segments, namely the restaurant business and the trading of agricultural commodities. In the restaurant business, the company owns and operates its own restaurants as well as operates through a franchise model. The company offers Neopolitan-style pizza, which is a traditional Italian pizza made with fresh ingredients. The menu includes a variety of toppings, and the company offers gluten-free and vegetarian options. 

In addition to the restaurant business, Neopolitan Pizza And Foods Limited also engages in the trading of agricultural commodities. The company deals in products such as wheat, rice, tomatoes, onions, and other such products. The trading segment of the business aims to source high-quality agricultural products from trusted suppliers and sell them to customers at competitive prices. The company's strategy is to leverage its expertise in the food industry to offer a unique and high-quality dining experience to its customers while also diversifying its revenue streams by engaging in commodity trading.

Neopolitan Pizza specializes in take-out and delivery of pizza made from the freshest and top-quality ingredients. Their franchisee’s follow the same strict guidelines when preparing any Neopolitan Pizza products, thus guaranteeing consistent quality across all outlets. With the vision of providing quality food with a quick and efficient service at a very affordable price, the group of Indo Canadian Entrepreneurs, led by Mr. Mukund Purohit plans to open ‘Neopolitan Pizza’ outlet at Multiple locations across India. The choice of the menu and the needed supply chain has already been built for an easy multi location/cities scale up in form of Company stores and the franchisee network.

AGRICULTURE AND ALLIED INDUSTRY OVERVIEW
India is one of the major players in the agriculture sector worldwide and it is the primary source of livelihood for about 55% of India’s population. India has the world's largest cattle herd (buffaloes), largest area planted to wheat, rice, and cotton, and is the largest producer of milk, pulses, and spices in the world. It is the second largest producer of fruit, vegetables, tea, farmed fish, cotton, sugarcane, wheat, rice, cotton, and sugar. Agriculture sector in India holds the record for second-largest agricultural land in the world generating employment for about half of the country’s population. Thus, farmers become an integral part of the sector to provide us with means of sustenance. 

Consumer spending in India will return to growth in 2021 post the pandemic-led contraction, expanding by as much as 6.6%. The Indian food industry is poised for huge growth, increasing its contribution to world food trade every year due to its immense potential for value addition, particularly within the food processing industry. The Indian food processing industry accounts for 32% of the country’s total food market, one of the largest industries in India and is ranked fifth in terms of production, consumption, export and expected growth.

According to Inc42, the Indian agricultural sector is predicted to increase to US$ 24 billion by 2025. Indian food and grocery market is the world’s sixth largest, with retail contributing 70% of the sales. India’s agricultural and processed food products exports stood at US$ 43.37 billion in FY23 (April 2022-January 2023). As per Second Advance Estimates for 2022-23 (Kharif only), total foodgrain production in the country is estimated at 153.43 million tonnes. At current prices, agriculture and allied sectors account for 18.3% of India's GDP (2022-23). As per the third Advance Estimates of National Income, 2021-22 released by the National Statistical Office (NSO), Ministry of Statistics & Programme Implementation, the agriculture and allied sectors contributed approximately 18.6 % of India's GVA at current prices during 2021-22. Between April 2000-December 2022, FDI in agriculture services stood at US$ 4.43 billion. 

Rapid population expansion in India is the main factor driving the industry. The rising income levels in rural and urban areas, which have contributed to an increase in the demand for agricultural products across the nation, provide additional support for this. In accordance with this, the market is being stimulated by the growing adoption of cutting-edge techniques including blockchain, artificial intelligence (AI), geographic information systems (GIS), drones, and remote sensing technologies, as well as the release of various e-farming applications.

In terms of exports, the sector has seen good growth in the past year. In FY23 (April 2022-February 2023): 

o Exports of marine products stood at US$ 7.4 billion. 
o Exports of rice (Basmati and Non-Basmati) stood at US$ 10.2 billion. 
o Buffalo meat exports stood at US$ 2.88 billion. 
o Sugar exports stood at US$ 5.28 billion. 
o Tea exports stood at US$ 759.96 million. 
o Coffee exports stood at US$ 1.01 billion.

The agriculture sector in India is expected to generate better momentum in the next few years due to increased investment in agricultural infrastructure such as irrigation facilities, warehousing, and cold storage. Furthermore, the growing use of genetically modified crops will likely improve the yield for Indian farmers. India is expected to be self-sufficient in pulses in the coming few years due to the concerted effort of scientists to get early maturing varieties of pulses and the increase in minimum support price. 

In the next five years, the central government will aim US$ 9 billion in investments in the fisheries sector under PM Matsya Sampada Yojana. The government is targeting to raise fish production to 220 lakh tonnes by 2024- 25. Going forward, the adoption of food safety and quality assurance mechanisms such as Total Quality Management (TQM) including ISO 9000, ISO 22000, Hazard Analysis and Critical Control Points (HACCP), Good Manufacturing Practices (GMP), and Good Hygienic Practices (GHP) by the food processing industry will offer several benefits. 

Through the Ministry of Food Processing Industries (MoFPI), the Government of India is taking all necessary steps to boost investments in the food processing industry in India. Government of India has continued the umbrella PMKSY scheme with an allocation of Rs. 4,600 crore (US$ 559.4 million) till March 2026.

QUICK SERVICE RESTAURANT (QSR) INDUSTRY REPORT
According to a report, the market for food services in India is predicted to increase from US$ 41.1 billion in 2022 to US$ 79.65 billion by 2028, with a CAGR of 11.19%. 

According to the Food Service and Restaurant Business Report 2022–23 by Francorp and restaurantindia.in, the industry is predicted to employ 1 crore people by 2025, despite losing over 20 lakh jobs at the height of the COVID–19 pandemic. 

The country's restaurant and food service market is split into two segments, with the unorganised segment holding the lion's share of the market, according to the report, which also noted that the organised sector expanded rapidly between 2014 and 2020. 

The market for quick service restaurants (QSRs) in the country is predicted to be worth US$ 690.21 million in 2022 and US$ 1069.3 million in 2027, rising at a CAGR of 9.15%, according to the report's additional findings. 

The QSR chain market is anticipated to increase at a CAGR of 23% over the course of FY20–25, making it the fastest-growing sub-segment overall in the food service industry.

The rating agency, ICRA said, the quick service restaurant sector (QSR) in India is anticipated to grow by 20– 25% in the current fiscal year due to an increase in demand and more market penetration driven by a rapid shop expansion. Long-term, factors like increasing QSR penetration rates, a shift from the unorganised to the organised segment with a preference for branded QSR players, given the convenience and hygiene factors (delivery over dine-in), etc., will support revenue growth. 

ICRA predicts that the top five players in the domestic quick-service restaurant market will likely open an additional 2,300 stores between FY23-FY25, spending an estimated US$ 707 million (Rs. 5,800 crore) on capital expenditures (CAPEX) (excluding renovations) during this period. 

As per the observation of ICRA, there is expected to be a capex boom in the QSR business due to favourable demographics, India's gradual urbanisation, rising per-capita gross domestic product (GDP), and greater headroom for QSR penetration compared to a developed nation like the US. "The CAPEX over FY23-FY25 has been estimated at around approximately US$ 219.4-243.8 million (Rs. 1,800-2,000 crore) per annum, which would be around 2.5 times that of the levels seen in FY20.

NEOPOLITAN PIZZA AND FOODS LIMITED COMPETITIVE STRENGTHS
1. QSR Segment
2. Agricultural Commodity Trading Segment

NEOPOLITAN PIZZA AND FOODS LIMITED STRATEGIES
1. Focus on Quality
2. Expand their Footprint
3. Strengthen their Brand Identity
4. Innovate their Menu
5. Embrace Technology
6. Build Strong Relationships

NEOPOLITAN PIZZA AND FOODS LIMITED RISK FACTORS & CONCERNS
1. The QSR segment is particularly sensitive to changes in the economy, and any economic downturn could result in decreased customer spending on dining out.
2. The Company previously got listed on Emerge ITP Platform of National Stock Exchange of India Limited (NSE) and the same stood voluntarily delisted.
3. Neopolitan Pizza And Foods Limited's agricultural commodity trading segment is subject to several risks associated with its supply chain.
4. Neopolitan Pizza And Foods Limited operates in the QSR and agricultural commodities trading industries, both of which are highly regulated.
5. Neopolitan Pizza And Foods Limited is a company that relies heavily on technology, from online ordering systems to supply chain management.
6. Wage increases in India may reduce their profit margins.
7. They generate majority portion of sales from their operations in certain geographical regions within Gujarat.
8. Their new food products may not be successful which could have an adverse impact on the business, results of operations and future prospects.