Any current/future new fundraising through debt or equity?

Currently, there are no active plans for new equity fundraising; a recent planned fundraise has been deferred as the opportunity did not materialize. Previous equity warrants issued in December 2022 are in process, with investors partially converting them into equity; full subscription expected by June 2024. Future equity raising will depend on value-accretive opportunities arising in the market. Regarding promoter shareholding, there are plans being considered with a timeline until June next year; no dilution is expected from these promoter plans as they may be non-dilutive. No specific menti

Any current/future capex/capital investment/strategic investment?

Foods & Inns plans a total CAPEX of around Rs. 40-50 crores for the current fiscal year, already funded through equity. For FY25, no major CAPEX planned except for spray drying capacity expansion and tomato processing plant. The company expects a minimum asset turnover of around 3x from the current CAPEX investments. A tomato concentrate plant is planned, expected to start production from October. The pectin manufacturing project is slightly delayed but expected to start by end of September 2023. Expansion in export markets (e.g., for Kusum spices) to mitigate export risks and diversify. Strat

Future growth expectations in sales/revenue/volumes?

Volume growth for the current fiscal year is expected around 15% to 20% on an annualized basis, although Q1 was impacted by unseasonal rains and the beverage industry's slower growth. (Page 13-14) Company remains hopeful to recover substantially in the next 8-9 months and regain the anticipated growth trajectory. (Page 14) Revenue growth is driven by increased production, especially a 40% higher mango pulp production than the previous season, which will be dispatched over 12-15 months. (Page 7) Realization per kg is expected to vary with mango varieties, some higher and some lower, balancing o

Future growth expectations in earnings/operating earnings/profits/EPS?

The company expects volume growth of around 15% to 20% annually, though Q1 saw some weather-related setbacks impacting volume recovery. Revenue growth is anticipated through increased realizations in mango pulp, especially for varieties like Alphonso with premium pricing. Operating cash flow is expected to turn positive this year due to lower raw material prices compared to last year. The company aims for an asset turnover ratio of about 3x on new CAPEX of Rs. 40-50 crores, indicating good revenue growth potential from investments. Profit before tax benefits from increased volumes, operating l

Current/ Expected Orderbook/ Pending Orders?

The company operates with long-term contracts, typically 12 to 15 months in duration, especially during the mango season. Larger brand customers, including Fortune 500 companies, honor their committed orders without fallback. Revenue recognition depends on the timing of customer call-offs rather than order cancellations; orders are fulfilled as per contract schedules throughout the year. At present, the company has confirmed orders in hand, but precise volume/ revenue estimates for the full fiscal year are difficult to provide due to variability in customer call-off timing. Post Q2, the compan

IN US

Sale is live|00:00:00left today

Foods & Inns LtdQ2 FY23Food Products

Foods & Inns Ltd Q2 FY23 Earnings Call Analysis

Revenue, margin, capex, fundraise and order book outlook from management commentary.

Price: ₹54.2P/E: 14.8Market Cap: ₹462 CrSector: Food Products

Management growth scorecard

Revenue

Category 3

Margin

Category 3

Fundraise

Order

Capex

Yes

1 of 5 growth signals are positive — mixed outlook.

Full analysis

Revenue guidance

Category 3

→Volume growth for the current fiscal year is expected around 15% to 20% on an annualized basis, although Q1 was impacted by unseasonal rains and the beverage industry's slower growth. (Page 13-14)
→Company remains hopeful to recover substantially in the next 8-9 months and regain the anticipated growth trajectory. (Page 14)
→Revenue growth is driven by increased production, especially a 40% higher mango pulp production than the previous season, which will be dispatched over 12-15 months. (Page 7)
→Realization per kg is expected to vary with mango varieties, some higher and some lower, balancing overall revenue. (Page 13)
→Expansion into other fruit and vegetable pulps is targeted to reduce dependency on mango pulp from 85% revenues closer to 50-60% in the coming years. (Page 6)
→New product launches like Tetra Recart and ready-to-eat categories expected to add to future revenues, with trials and commercial scaling ongoing. (Page 9)
→Asset turns for new CAPEX projects anticipated at around 3x to boost revenue growth. (Page 12)

Margin guidance

Category 3

→The company expects volume growth of around 15% to 20% annually, though Q1 saw some weather-related setbacks impacting volume recovery.
→Revenue growth is anticipated through increased realizations in mango pulp, especially for varieties like Alphonso with premium pricing.
→Operating cash flow is expected to turn positive this year due to lower raw material prices compared to last year.
→The company aims for an asset turnover ratio of about 3x on new CAPEX of Rs. 40-50 crores, indicating good revenue growth potential from investments.
→Profit before tax benefits from increased volumes, operating leverage, and price pass-through models, which stabilize margins.
→Expansion into tomato processing and pectin production by late FY24 is expected to contribute to earnings growth.
→PLI (Production Linked Incentive) benefits of around Rs. 20 crores are expected by March 2024, providing additional earnings support.
→Overall, growth in earnings and profits is linked to volume expansion, product diversification, and improved operational efficiency.

3 more insights locked — sign up free to unlock

Fundraise plans

→Currently, there are no active plans for new equity fundraising; a recent planned fundraise has been deferred as the opportunity did not materialize.
→Previous equity warrants issued in December 2022 are in process, with investors partially converting them into equity; full subscription expected by June 2024.
→Future equity raising will depend on value-accretive opportunities arising in the market.
→Regarding promoter shareholding, there are plans being considered with a timeline until June next year; no dilution is expected from these promoter plans as they may be non-dilutive.
→No specific mention of new debt fundraising; existing working capital needs are supported by increased production, leading to increased working capital borrowings and finance costs, but no new debt plan announced.
→Overall, fundraising activities are opportunistic and contingent on market conditions and value propositions.

Order book

→The company operates with long-term contracts, typically 12 to 15 months in duration, especially during the mango season.
→Larger brand customers, including Fortune 500 companies, honor their committed orders without fallback.
→Revenue recognition depends on the timing of customer call-offs rather than order cancellations; orders are fulfilled as per contract schedules throughout the year.
→At present, the company has confirmed orders in hand, but precise volume/ revenue estimates for the full fiscal year are difficult to provide due to variability in customer call-off timing.
→Post Q2, the company expects to have better clarity on estimated annual volumes based on order execution trends.

Capex plans

Yes

→Foods & Inns plans a total CAPEX of around Rs. 40-50 crores for the current fiscal year, already funded through equity.
→For FY25, no major CAPEX planned except for spray drying capacity expansion and tomato processing plant.
→The company expects a minimum asset turnover of around 3x from the current CAPEX investments.
→A tomato concentrate plant is planned, expected to start production from October.
→The pectin manufacturing project is slightly delayed but expected to start by end of September 2023.
→Expansion in export markets (e.g., for Kusum spices) to mitigate export risks and diversify.
→Strategic focus on launching new SKUs (6 ready-to-cook SKUs under Tetra Recart packaging) and increasing presence in frozen fruits and vegetable segments.
→Exploring opportunities for copacking with large brands, targeting revenue growth from Q4 FY24 onwards.

How does Foods & Inns Ltd rank vs peers in Food Products?

Pro feature

1Foods & Inns Ltd

Rev 3Mar 3

See full Food Products sector rankings

Want more stocks like Foods & Inns Ltd?

Build an AI portfolio filtered by sector, market cap, and growth rank. Takes 2 minutes.

Build my portfolio