FREE Equity Delivery and MF
Flat ₹20/trade Intra-day/F&O
The financial performance of Mrs. Bectors Food has been consistent in the last three fiscals with the pandemic effect seen in FY20. Total revenues for FY20 reduced by 2.70% to Rs 764.98 crore from Rs 786.03 crore in FY19. The decline is attributable to a reduction in the supply of bakery products to QSR customers and a reduction in the export of biscuits to African countries.
PAT is showing a reducing trend in FY20 and FY19 when compared to corresponding last year. For FY20, PAT reduced by 10% to Rs 29.80 crore from Rs 33.18 crore due to the increased finance cost and depreciation cost. Operating margins have been consistent at 12% since the last three fiscals. Net margins are 3.89% and 4.22% for FY20 and FY19 respectively.
A rising trend is seen in the financial performance for H1FY21. For the six months, revenue from operations has increased to Rs 438.56 crore (20%increase) as against Rs 366.21 crore in H1FY19. This was due to the increased sale of products in domestic as well as export category and price revision undertaken in October 2019. The demand for packaged food has increased due to the COVID-19 pandemic. Operating and Net margins rose to 18.51% and 8.77% for H1FY21.
Title | H1FY20 | FY2020 | FY2019 | FY2018 |
Total Revenue | 438.56 | 764.98 | 786.03 | 695.76 |
Revenue from Operations | 430.99 | 762.12 | 783.67 | 693.97 |
PAT | 38.44 | 29.76 | 33.18 | 36.07 |
EBITDA | 79.78 | 92.86 | 96.16 | 85.51 |
Total Assets | 608.73 | 565.72 | 577.04 | 511.06 |
Cash and Bank | 47.66 | 30.25 | 12.03 | 10.73 |
Cash generated from Operations | 74.64 | 121.85 | 68.35 | 62.00 |
Operation Margin(%) | 18.51% | 12.18% | 12.27% | 12.32% |
Net margin(%) | 8.77% | 3.89% | 4.22% | 5.18% |
Particulars | Nestle India | Britannia | Pratap Snacks | DFM Foods | Mrs Bectors |
Face Value Per Share | 10 | 1 | 5 | 2 | 10 |
Total Income for FY20 (INR Crore) | 12615.78 | 11878.95 | 1403 | 514.72 | 764.98 |
Basic EPS | 204.28 | 58.35 | 20.01 | 4.86 | 5.3 |
NAV per Share | 200.41 | 183.09 | 259.24 | 29.03 | 55.76 |
Return on Net Worth | 101.93% | 31.65% | 7.72% | 16.79% | 9.32% |
The P/BV is 5.16 at NAV of Rs 55.76 as at 31st March 2020. At upper band price of Rs 288, P/E is 49.74 as against the industry average of 63.92.
Valuation Parameters | EPS | P/E | NAV | Industry P/E | Industry P/BV |
. | 5.31 | 49.74 | 55.76 | 63.92 | 5.16 |
The packaged food industry has seen sustainable growth in India due to the increase of packaged food consumption and awareness, and demand for quality products. Coronavirus outbreak is expected to have a positive impact on packaged foods due to rising consumer awareness.
As per RHP, according to the Technopak Report, the premium and mid-premium category biscuits market is expected to grow at a CAGR of 9.5% from FY20 to FY25. And the market for bread and buns retail market in India is estimated to grow at a CAGR of 9% from FY20-FY25. The outlook for the sectors remains promising although with high competition among the organized and unorganized players competing for the market share.
Mrs. Bectors Cremica is one of the leading brands in biscuits in North India and English oven is a growing brand in the bread segment. BFS has made substantial investments of approx. Rs 258 crore to increase the capacities which have resulted in increased sales volumes. Fresh issue proceeds are proposed to be utilized for a new production line for the biscuit segment. However, the financial performance has been stable since the last three fiscals with the rising trend seen in H1FY21. BFS’s capability to sustain this performance amidst the highly competitive food industry needs to be tracked. Hence investors may subscribe for the medium term.
Review By CA Priyanka Choudhary on 6th Dec 2020
About CA Priyanka Choudhary
Priyanka Choudhary Jain is a Chartered Accountant and an experienced credit analyst. She has worked with CRISIL as Senior Credit Analyst on ratings assignments including business and financial analysis in Corporates as well as the Public Finance Sector.
Email: [email protected]
DISCLAIMER: No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. Readers must consult a qualified financial advisor prior to making any actual investment decisions, based on information published here. Any reader taking decisions based on any information published here does so entirely at own risk. Investors should bear in mind that any investment in stock markets are subject to unpredictable market related risks. Above information is based on RHP and other documents available as of date coupled with market perception. Author has no plans to invest in this offer.