Freshara Agro Exports Limited IPO Overview

Freshara Agro Exports Limited is involved in the procurement, processing, and export of preserved gherkins and other pickled commodities. The company directly sources from accredited farms committed to sustainable agriculture and operates buy-back agreements with farmers, providing necessary sowing materials like seeds.

The company's IPO comprises a Book Built Issue amounting to ₹75.39 Crores, entirely a Fresh Issue of 64.99 lakh shares. The subscription period for the IPO runs from October 17 to October 21, 2024, and the shares will be listed on the NSE SME, with a tentative listing date of October 24, 2024.

Issue Price Band: ₹110 to ₹116 per share

Lot Size: Minimum 1,200 shares

Retail Minimum Investment: ₹1,39,200

HNI Minimum Investment: ₹2,78,400 (2 lots)

The book-running lead manager is GYR Capital Advisors Private Limited, with Purva Sharegistry (India) Private Limited as the registrar and Giriraj Stock Broking Private Limited acting as the Market Maker.

Freshara Agro Exports Limited IPO GMP

The Grey Market Premium (GMP) for Freshara Agro Exports IPO is ₹35, indicating potential listing gains of around 30%. However, it is essential to understand that GMP is speculative and depends on market demand and supply in an unregulated environment.

Financial Performance

Freshara Agro Exports shows consistent growth, particularly in its export operations. The company has established itself as a reliable supplier of preserved vegetables, leveraging sustainable agricultural practices with small and marginal farmers.

Revenues:

FY22: ₹11,840.68 Lakhs

FY23: ₹12,700.22 Lakhs

FY24 (Jan 24 – Mar 31): ₹7,324.98 Lakhs

EBITDA:

FY22: ₹495.41 Lakhs

FY23: ₹1,749.30 Lakhs

FY24 (Jan 24 – Mar 31): ₹1,385.66 Lakhs

Profit After Tax (PAT):

FY22: ₹97.36 Lakhs

FY23: ₹908.20 Lakhs

FY24 (Jan 24 – Mar 31): ₹996.77 Lakhs

Key Financial Ratios

Pre-issue EPS: ₹12.83

Post-issue EPS: ₹9.29

Pre-issue P/E: 9.04x

Post-issue P/E: 12.49x

Return on Capital Employed (ROCE): 10.04% (2MFY24)

Return on Equity (ROE): 36.96% (2MFY24)

Given the company's growth trajectory and profitability, the IPO is considered fairly priced compared to industry peers.

IPO Objectives

The company aims to utilize the proceeds from the IPO for the following purposes:

₹879.97 Lakhs for capital expenditure.

₹5,600.00 Lakhs for working capital requirements.

General corporate purposes and issue expenses.

Subscription Status and Anchor Investors

As of October 18, 2024 (05:10 PM), the IPO was oversubscribed 32.55 times on the second day of its subscription period, showcasing strong investor demand. Freshara Agro Exports raised ₹20.43 Crores from Anchor Investors, allocating 17,61,600 shares at ₹116 per share.

Freshara Agro Exports IPO Allotment and Listing

Allotment Date: October 22, 2024

Listing Date: October 24, 2024

Investors can check their allotment status on the Registrar’s website using their application number, PAN, or DP Client ID.

Conclusion: Should You Invest?

Freshara Agro Exports Limited’s consistent financial performance, focus on sustainable agriculture, and steady growth in gherkins and pickled commodities export make it an attractive option for risk-tolerant investors looking for listing gains or long-term growth potential. The IPO’s pricing, coupled with a moderate GMP and significant oversubscription, suggests promising prospects, albeit with some risks associated with its niche market.

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