Fell down 8% today post Q4 results.

Current Mcap: 40cr
CMP: 59.2

Sampre Nutritions Limited is a Public Limited Company domiciled in the State of Telangana,
Hyderabad incorporated under the Provisions of the Companies Act, 1956. The Company is
engaged in the activity of manufacturing of confectionery products.
The principal place of business is situated at 133, TSIIC Industrial Estate, Medchal-501401,
Medchal Malkajgiri Dist, Telangana.
Total no of employees:128

The company is engaged in manufacturing complete range of confectionery, éclairs, candies, toffees, powder and centre filled products. The company is instrumental to deliver the growing volumes for most of the MNC’s and beside producing its own brand. The group one stop shop for complete range of confectionary productions.

Large companies such as Mondelez, Nestle, and Mars dominate the chocolate category, while regional firms account for over 35% of the confectionery market.

The Company had signed an agreement with The African Peace and Security Union to set-up of manufacturing plant for the complete range of Fortified Vitaminized Candies for African Countries and all related requirements in November 2022

As the current production capacities are being fully utilized and in view of request from M/s. Mondeleze India Foods Private Limited, Principal client of the company for additional capacities, agreement with Reliance Retail Limited for supply of complete range of confectionary and potential demand from export market, there is urgency to increase production capacities to serve the order of customers.

Considering 25 years of valuable association with Mondelez India, they have further approached the company for manufacture of caramel based lollypop in eclairs category. In this regard company has placed order for import of new line of machinery for manufacture of lollypops with capex of 2.5 Crores and this is expected to add another 350 tonnes per annum capacity to the existing capacity.

Company has also raised funds by way of issue of equity and Convertible Warrants
with the object of meeting the long-term funding requirements of the Company for
capital expenditure, working capital, general corporate purposes, etc. in order to
support the future growth plan of the Company. Also, Company has obtained
approval of members for raising of funds and issuance of securities through QIP
and/or FCCB and/or any other permissible modes not exceeding USD 100 Million
only.

Management of the company:

Red Flags:
1:) The company has significant related party transactions.

2. Significant increase in management remuneration.

   
   

3. Wide fluctuations in operating margins of the company

   

4. Decline in promoter Shareholding

   

   Promoter shareholding has declined in the last few years due to dilution of equity by issue of warrants and equity to raise funds for capex of new plant that has commissioned.

5. Pending litigations:

   

Disc: Hold a tracking position

If I have to consider active MF I track portfolio for last 5 years and see how they mange the fund and try to read fund manger commentary on different times. Key things I look in portfolio review

1. Churn rate.
2. What is the holding period.
3. What are its key large holding.
4. Wat are its failures.