Gemini Edibles & Fats India will haul Rs 2500 in an offer for sale IPO. The Hyderabad-based company is a leading and fastest growing edible oils and fats company.
The company manufactures, distributes and brands edible oils and speciality fats in India. It is one of the leading and fast-growing edible oils and fats companies. They market their sunflower oil under the ‘Freedom’ brand and are among the top two companies by market share in the branded sunflower oil category on a pan-India basis as of Fiscal 2021.
Their range of edible oils and fats are sold to our customers under three verticals, i.e., branded retail consumer, industrial consumer and bulk merchandising.
Gemini Edibles & Fats India Ltd. Objective
- Since it is an offer for sale, the company will not receive funding from the sale of equities.
Why should you invest in Gemini Edibles & Fats India Ltd. IPO?
Here are our top reasons.
- Indian edible oils and fats are experiencing significant growth due to the increasing population and rising per capita income.
- India’s edible oil consumption is estimated to be approximately 21 million MT for OY 2020 (i.e., from November 2019 to October 2020) and is forecasted to grow to 25 million MT by OY 2025.
- The Indian edible oil retail market comprising household consumers and hotels, restaurants, and caterers (“HoReCa”) is expected to grow at a CAGR of 6% from Fiscal 2020 to Fiscal 2025.
- The branded edible oil market is expected to grow at an 8% CAGR from 2020 to 2025.
IPO Financials
| Particulars | FY21 | FY20 |
|---|---|---|
| Revenue From Operation | 77,659.62 | 65,002.49 |
| EBITDA | 7,636.68 | 2,788.82 |
| EBITDA Margin (%) | 9.7 | 4.2 |
| Profit After Tax | 5,707.69 | 1,858.50 |
| EPS | ||
| ROE | 42.6 | 19.3 |
Know before investing
Strengths
3'Freedom' brand ranked among India's top five cooking oil brands according to India Today's 'Ipsos Urban Consumer Sentiment Survey 2020'.
They are one of the largest players in speciality fats in south India with around 16% market share in speciality bakery fats.
They operate large-scale integrated facilities and are strategically located at the ports of Krishnapatnam and Kakinada in southeastern India.
Risks
3The company needs an uninterrupted supply of raw materials to continue generating returns for investors.
The concentrated market in south India and the inability to expand the market can adversely affect the company's profitability.
If the company fails to implement its business strategies or sustain or manage growth, it will impact future cash flow.
Peer Comparison
| Company Name | Total Income | P/E | EPS in Rs (Diluted) | Dividend Yield |
|---|---|---|---|---|
| Marico Limited | 81,420.00 | 58.12 | 9.08 | - |
| Agro tech Foods Limited | 8,934.20 | 75.79 | 13.17 | - |
| Gemini Edibles & Fats India Limited | 78,631.08 | NA | 55.48 | - |
