Freshara Agro Exports is engaged in the procurement, processing, and exporting of preserved gherkins and other pickled commodities from India to various countries worldwide. The procurement process involves direct sourcing from accredited farms committed to sustainable agricultural methodologies. The company establishes buy-back agreements with farmers, providing them with necessary sowing materials such as seeds to assist small and marginal farmers.

Investment Details

The Freshara Agro Exports IPO is a Book Built Issue amounting to ₹75.39 Crores, consisting entirely of a Fresh Issue of 64.99 Lakh Shares. The subscription period opens on October 17, 2024, and closes on October 21, 2024. The allotment is expected to be finalized on or about October 22, 2024, with shares listed on the NSE SME around October 24, 2024.

The share price band is set at ₹110 to ₹116 per equity share, with a minimum lot size of 1,200 shares. Retail investors are required to invest a minimum of ₹1,39,200, while High-Net-Worth Individuals (HNIs) must invest in 2 lots (2,400 shares), totaling ₹2,78,400.

GYR Capital Advisors Private Limited is the book-running lead manager, and Purva Sharegistry (India) Private Limited is the registrar for the issue. Giriraj Stock Broking Private Limited will act as the market maker for the IPO.

Grey Market Premium and Allotment Status

The Grey Market Premium (GMP) for Freshara Agro Exports IPO is currently estimated at ₹35, reflecting investor sentiment based on the company's financial performance. It’s essential to remember that trading based on GMP is speculative and does not guarantee price discovery prior to the listing. The GMP is mentioned for educational and informational purposes only.

As of 10:20 AM on October 18, 2024, the live subscription status indicates that the IPO has been subscribed 12.60 times on its second day of the subscription period.

Anchor Investors Report: Freshara Agro Exports has raised ₹20.43 Crores from anchor investors at a price of ₹116 per share, allocating 17,61,600 equity shares to them.

Objectives of the Freshara Agro Exports IPO

Proceeds from the Fresh Issue will be utilized for:

₹879.97 Lakhs for capital expenditure.

₹5,600.00 Lakhs for funding working capital requirements.

General corporate purposes.

Meeting issue expenses.

Company Overview and Financial Performance

Freshara Agro Exports is led by Mr. Junaid Ahmed and Mr. Iqbalahmed Khudrathullah Mohammed, who have a combined experience of over 9 years in the gherkins and pickled vegetables export business.

Financially, Freshara Agro Exports has shown consistent revenue:

Revenue from operations for FY22 was ₹11,840.68 Lakhs, FY23 was ₹12,700.22 Lakhs, and for the periods ending January 23, 2024, and March 31, 2024, were ₹12,476.60 Lakhs and ₹7,324.98 Lakhs, respectively.

EBITDA figures for FY22 and FY23 were ₹495.41 Lakhs and ₹1,749.30 Lakhs, with ₹2,176.09 Lakhs and ₹1,385.66 Lakhs for the respective periods.

Profit After Tax (PAT) increased to ₹97.36 Lakhs in FY22, ₹908.20 Lakhs in FY23, and further to ₹1,185.64 Lakhs and ₹996.77 Lakhs for the specified periods.

For the Freshara Agro Exports IPO, the pre-issue Earnings Per Share (EPS) stands at ₹12.83, while the post-issue EPS is ₹9.29. The pre-issue Price-to-Earnings (P/E) ratio is 9.04x, and the post-issue P/E is 12.49x. The company's Return on Capital Employed (ROCE) for 2MFY24 is 10.04%, and Return on Equity (RoE) is 36.96%, suggesting that the IPO is fairly priced.

The Grey Market Premium (GMP) indicates potential listing gains of 30%. Given the company's financial performance and IPO valuation, we recommend that only risk-tolerant investors consider applying for the Freshara Agro Exports Limited IPO for potential listing gains or long-term investment purposes.

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