Chatha Foods

- The company is raising money through an initial public offering (IPO) as part of their growth and expansion plans. - Funds from the IPO will primarily be used to set up a new vegetarian plant to diversify product offerings and customer base. - No mention of any other current or future fundraising through debt. - The focus is on organic growth with internal accruals and equity infusion from the IPO. - No indication of specific plans to raise external debt at this time, though the possibility is not explicitly ruled out.

- Chatha Foods is setting up a new vegetarian plant with an estimated capex of around INR 40 crores. - Construction for the new plant is planned to start soon, with operations expected to begin by March 2025. - The new plant will diversify product lines, including flatbreads, frozen-to-fry patties, ready-to-eat sauces, gravies, and shelf-stable rice. - Expected peak capacity of the new unit is about 16,000 metric tons with potential revenue around INR 200-210 crores. - The new plant aims for 10-12% EBITDA margin and focuses on both existing and export markets. - For the existing chicken unit, no immediate plans for a new plant, but expansion is in thoughts. - Existing chicken plant’s gross block is close to INR 59 crores; net asset around INR 30 crores. - The company expects ramp-up of vegetarian plant sales in FY25 and FY26 with breakeven at approximately 45% utilization.

- New vegetarian plant to drive 2-3x growth over next few years, aiming to diversify product lines (flatbreads, frozen to fry patties, ready-to-eat sauces and rice). - Chicken business expected to grow about 20% over next 2 years, targeting INR175-200 crores revenue from existing unit by FY26. - Combined target for company revenue in 3-4 years: INR300-400 crores with 10-12% EBITDA margin, potentially improving with economies of scale. - Export markets will be a major growth area for vegetarian products; new sales hires planned for export market expansion. - QSR customer base growth driven by adding new clients and expanding share with existing ones; smaller QSR chains growing at pace with larger ones. - Frozen to fry and ready-to-eat lines expected to ramp quicker; bread line may take longer. - Existing chicken capacity utilization at ~65-66%; peak utilization could go up to 70-75%.

- The company aims to grow its business 2-3x over the next few years by setting up a new vegetarian plant focused on QSR needs and exports. - The new vegetarian plant (INR40 crore capex) is expected to generate peak revenue of around INR200-210 crore with EBITDA margins targeted at 10-12%. - The existing chicken business is expected to grow at about 20% CAGR, ramping up revenues from INR130-135 crore to INR175-200 crore over 2 years, with EBITDA margins in the 10-12% range. - The company targets 10-12% EBITDA margins overall, with margin improvement potential from economies of scale, especially in bread/vegetarian products. - Medium-term aspiration: Achieve INR300-400 crore in sales with 10-12% EBITDA margins in 3-4 years, driven by diversification and expansion in product lines and customers. - Export market expansion will require hiring additional sales staff, indicating expected growth in international revenues.

- The company has ongoing commitments for the ready-to-eat side with soft dialogues started with QSR customers in India, particularly for flatbreads. - For export of breads, they are still in the product development phase and searching for customers. - The frozen to fryer product line is already in trial stages, with existing dialogues with customers like Subway and Taco Bell. - There is a small partnership started with Zomato for small QSR businesses, indicating growing order opportunities there. - Existing large clients like Domino's and Subway provide a significant share of business; Domino's accounts for about 45% of revenue. - The company is adding new clients such as Blue Tokoi, Third Wave Coffee, Tim Hortons, and Wok Express. - They have not received volume plans from larger QSR clients but get updates on store openings and product launches regularly. Overall, orderbook is a mix of committed orders for ready-to-eat products and exploratory discussions for export and newer product lines.