ADF Foods –
Q3 FY 24 concall and results highlights –
A leading manufacturer and distributor of prepared ethnic foods with annual food processing capacity of 28000 MT at 02 manufacturing facilities – @ Nadiad ( Gujarat ) and Nasik ( Maharashtra )
Exporting to 55 countries, has 180 worldwide distributors, 02 warehouses in US
Exporting over 400 SKUs, 8 well known International brands
Flagship brand – Ashoka
New brand launches – Truly Indian, Soul
Legacy brands – Camel, Aeroplane
Q3 FY 24 financial outcomes –
Revenues – 129 vs 123 cr
EBITDA – 27 vs 27 cr
PAT – 19 vs 18 cr
9M FY 24 financial outcomes –
Revenues – 366 vs 327 cr
EBITDA – 70 vs 54 cr ( margins @ 19 vs 16 pc, overall very healthy margins )
PAT – 49 vs 40 cr ( PAT margins @ 13 vs 12 pc )
Company has 02 business verticals –
Food processing ( 80 pc of sales, Q3 EBITDA margins @ 27 pc ) – own product portfolio targeted at Indian Diaspora
Distribution ( 20 pc of sales, Q3 EBITDA margins @ 8 pc ) – agency distribution business for leading FMCG companies at an international level. Company distributes Unilever brands like – Taj Mahal, Lipton, Red Label, Knorr
Soul Brand – offers a wide array of Pickles, Sauces and Pastes – aimed at domestic Indian Mkts in Urban areas. Aim to make it a 100 cr brand in 3-4 yrs
Truly India brand – aimed at international mkts for customers seeking Indian flavours. Offers – ready to heat foods including vegan and vegetarian options
Camel Brand – premium brand aimed at Indians residing in Gulf countries. Includes – meal accompaniments, pastes, sauces. Drives 95 pc of sales through modern trade
Aeroplane brand – economy brand aimed at Indians residing in gulf countries. Includes – meal accompaniments, pastes, sauces. Drives 65 of sales through modern trade and 35 pc through general trade
Company continues to be debt free
Q3 sales were impacted by Red Sea crisis
Company invested an additional Rs 13 cr in its subsidiary Telluric foods to accelerate its India business growth ( under the brand – Soul )
Launched several new products under the Ashoka brand in Q3 in frozen foods, canned sweets and Indo-Chinese sauces categories
Capex spend for Q3 was Rs 7 cr ( 3.5 cr each towards de-bottlenecking and expansion of cold storage infra )
Looking to add some additional brands to the distribution business – in order to drive the distribution business’s growth
Company has recently tied up with Tesco ( UK based retailer ) for 3 of its SKUs. Aiming to drive > 8 cr sales from this tie up for next FY
**Expecting 15 pc kind of topline growth for full FY 24. Also expecting to recover sales lost in Q3 **
( due Red Sea issue )
Ashoka brand contributes to around 55-60 pc of company’s foods business ( ie – Ex – distribution )
Normal Capex lined up for FY 25 is about 3-4 cr. Additionally, the company intends to spend around 60-70 cr towards Greenfield capex over 15 months starting Apr 24
Freight costs @ 7 pc of standalone sales ie excluding the distribution sales ( in Q3 )
Aim to grow Ashoka brand @ 25 pc kind of run rate in FY 24
Soul brand is targeted at Urban areas – to upper middle class audience. Currently doing 5 – 6 cr of annual sales. Currently only selling via E-Commerce. Modern trade launch is lined up
Expect to do more than 100 cr of sales in the distribution business in FY 25
Company is having 140 cr of cash on balance sheet
Company is entitled to receive PLI benefits worth aprox 50 cr over next 3 yrs
Disc: holding, biased, not SEBI registered
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