Quanto Agroworld IPO

GMP History

Strengths

• ✓The company claims to operate across key stages of the MAP value chain, including cultivation, harvesting, post-harvest handling, steam distillation, and dispatch. This reduces its reliance on third-party intermediaries for cultivation and primary processing, it claims.
• ✓The company claims to have access to agricultural land through multi-year leases with MSFCL and private land leasing arrangements through its subsidiary. This is claimed to provide visibility over land availability and tenure, supporting advance crop planning, phased development, and expansion of cultivation capacity.
• ✓The company claims to undertake cultivation and processing in-house, with distillation facilities located close to cultivation areas. This helps reduce transportation requirements, handling losses, and processing turnaround time.
• ✓The company claims to follow an asset-light approach by primarily accessing agricultural land through leases rather than ownership. MSFCL and private leasing arrangements allow it to expand cultivation capacity without significant capital expenditure on land acquisition.
• ✓The company claims to operate under a quality-oriented framework supported by ISO 9001:2015 certification and Kosher and Halal certifications. Quality controls cover cultivation, harvesting, and processing, with emphasis on hygiene, documentation, and process discipline to meet specification requirements of institutional B2B customers.
• ✓The company claims to follow chemical-free and regenerative farming practices supported by soil sampling, rainwater harvesting, and efficient irrigation management. It also reuses post-distillation biomass for composting or boiler fuel. These practices are stated to support resource efficiency, waste reduction, and circular utilisation across operations.
• ✓The company has seen a consistent increase in revenue from operations and PAT. Revenue from operations increased from Rs 15.55 crore in FY23 to Rs 16.49 crore in FY24 to Rs 40.35 crore in FY25, while PAT increased from Rs 5.37 crore in FY24 to Rs 6.63 crore in FY25 to Rs 8.38 crore in FY26.

Risks

• !The company has made a significant portion of its purchases from Quanto Agritech Private Limited, its subsidiary. Purchases amounted to Rs 2.28 crore (23.31% of total expenses) in FY24 and Rs 2.47 crore (24.81%) in FY23. This exposes the company to vendor concentration, supply disruption, pricing and related-party risks.
• !The company’s agricultural operations are exposed to adverse weather conditions, including irregular monsoons, excessive rainfall, floods, droughts, heatwaves, and cyclones. Such factors could reduce crop yields, affect raw material availability, and increase input and logistics costs. Climate-related regulations concerning water, energy, and environmental standards could also increase compliance and operating expenditure.
• !The company operates across two business verticals, namely essential oil and lemongrass. Managing these verticals increases operational complexity and requires adequate managerial expertise, internal controls, accounting systems, and employee capabilities. Any inability to effectively manage and coordinate these operations may adversely affect its business, operating results, and financial condition.
• !The company derives a significant portion of its revenue from a limited number of customers. Revenue from its top 10 customers was Rs 35.78 crore (88.67%) in FY26, Rs 12.24 crore (74.19%) in FY25, and Rs 13.33 crore (85.70%) in FY24. Loss of major customers could adversely affect revenue and profitability.
• !The company does not have material external suppliers for its core raw materials, as lemongrass and other MAP biomass are largely generated through its own cultivation activities. Also, the top 10 suppliers account for the majority of the company’s purchases. While this reduces external sourcing dependence, any disruption affecting its cultivation and processing operations could impact the availability of raw materials and business continuity.
• !The company operates with only 11 employees, while key agricultural activities, including irrigation, nutrient application, plant protection, and harvesting, are largely undertaken by contract labour engaged on a need basis. As there are no formal or long-term agreements, labour shortages or increased labour costs could affect crop yield, productivity, and financial performance.
• !The company’s operations and revenues are concentrated in Maharashtra and Gujarat. In FY26, Maharashtra contributed Rs 40.05 crore (99.26%), and Gujarat contributed Rs 0.30 crore (0.74%) of total revenues, with 100% of revenues derived from the Western Region. This exposes the company to region-specific economic, regulatory, and other risks.
• !The company, its promoters, and senior management are involved in ongoing tax proceedings, criminal proceedings, and actions by regulatory and statutory authorities. Any adverse judgments in the cases could be detrimental to the company’s business prospects.
• !The company has experienced negative cash flows from investing and financing activities. Investing cash outflows were Rs 0.46 crore in FY26, Rs 6.61 crore in FY25, and Rs 7.64 crore in FY24, primarily due to the purchase of property, plant and equipment, changes in CWIP, and loans and advances. Financing cash outflows were Rs 0.06 crore, Rs 0.23 crore and Rs 0.21 crore, in the same periods, respectively, mainly due to interest payments exceeding proceeds from long-term borrowings. Continued negative cash flows may constrain funds available for operations, expansion, and future capital requirements.
• !As of FY26, the company’s trade receivables were Rs 9.40 crore. Any failure to collect these receivables on time or at all can negatively impact the business and its financial condition.
• !As of FY26, the company had outstanding financial indebtedness of Rs 5.47 crore. Any failure to service or repay these loans can harm the company’s operations and financial position.

About Quanto Agroworld

Quanto Agroworld is engaged in the cultivation, processing, and supply of medicinal and aromatic plants (MAPs) in India, with lemongrass as its primary crop. The company undertakes activities including land preparation, plantation, crop management, harvesting, steam distillation, packaging, and dispatch. Its products include lemongrass biomass, lemongrass tea-cut, and lemongrass essential oil, which are supplied primarily to institutional and B2B customers across India. The company’s cultivation operations are undertaken on government-leased agricultural land and privately leased farmland. It has approximately 424 acres of developed MSFCL land under cultivation, 312.57 acres under development, and 165.33 acres of privately leased agricultural land managed through its subsidiary, Quanto Agritech Private Limited. Its processing facility located at Ravalgaon, Maharashtra, is spread across approximately 0.50 acres. The facility has steam distillation units, storage infrastructure, and related utilities, with a certified installed essential oil processing capacity of approximately 11.25 metric tonnes per annum (MTPA). Use of proceeds: This is a fresh issue of shares. Therefore, the net proceeds from the fresh issue will go to the company. They will be utilised for the following purposes: Capital expenditure for distillation plant at Ravalgaon, Maharashtra – Rs 3.79 crore Capital expenditure for expansion and development of farms – Rs 15.23 crore Prepayment or repayment of all or a portion of certain outstanding borrowings availed by the company – Rs 3.63 crore General corporate purposes – Rs 4.65 crore