Bikaji Foods m-cap crosses Rs 10,000 crore; stock 36% above issue price

Shares of Bikaji Foods International continued their upward movement and surged 8 per cent to hit a new high of Rs 408 in Friday’s intra-day trade. The stock of packaged foods company quoted higher for the fourth straight day as it soared 31 per cent, during the period.

Currently, Bikaji Foods traded 36 per cent higher against its issue price of Rs 300 per share. It had made stock market debut on November 16, 2022.

A sharp rally in the stock price of the company saw market captialisation of Bikaji Foods cross Rs 10,000 crore in Friday's intra-day trade. At 10:33 am; the stock traded 6.8 per cent higher at Rs 405.35, with a market capitalisation of Rs 10,114 crore, the BSE data shows. In comparison, the S&P BSE Sensex was down 0.10 per cent at 62,212.

On November 16, Goldman Sachs Funds - Goldman Sachs India Equity Portfolio purchased 1.74 million equity shares of Bikaji Foods at Rs 324.50 per share via open market deals, the NSE bulk deal data showed. The name of the seller, however, was not disclosed.

Bikaji Foods is the third largest ethnic snacks company in India, with a presence across international markets. As new capacities take place with upcoming facilities in Rajasthan and Bihar, the management is upbeat about maintaining more than 20 per cent revenue CAGR in the next 3-4 years.

In addition, analysts at Ventura expect that the lower capex requirements of the company and price hikes would protect gross margins at 30 per cent, in order to maintain healthy profitability and cash flows.

"We expect Bikaji’s revenue/ EBITDA/ net profit to grow at a CAGR of 22.6 per cent/35.9 per cent/ 40.5 per cent to Rs 2,970 crore/ Rs 350 crore/ Rs 216 crore, respectively over FY22-25E, while EBITDA and net margins are expected to improve by 313bps (to 11.8 per cent) and 245bps (to 7.3 per cent), respectively over the same period," the brokerage firm said.

That apart, in a bull case scenario, analysts assume FY25 revenues to be around Rs 3,500 crore (FY22-25 CAGR of 29.5 per cent) and net margin at  7.5 per cent, resulting in a target price of Rs 421 per share.

On the flipside, analysts expect FY25 revenues to be around Rs 2,500 crore (FY22-25 CAGR of 15.8 per cent), with net margin of 7 per cent, which would create a bull case price target of Rs 245 per share (down 18.2 per cent from IPO price).

Meanwhile, analysts at Indsec Securities and Finance believe that the focus on expansion of its geographic reach, strong distribution network, diversified product portfolio, and commencement of new plants would boost margins.