 "food processing")
The initial public offering of small and medium enterprise (SME) Chatha Foods will open for public subscription on Tuesday, March 19 and close on Thursday, March 21. The price band for the offer is Rs 53-56 and the company is aiming to raise Rs 34 crore via a fresh issue of nearly 6 million shares.
Of the total net proceeds, the company aims to use Rs 24.11 crore for setting up a manufacturing facility in Mohali and the remaining amount for general corporate purposes.
The minimum bid lot is 2,000 equity shares and in multiples of 2,000 shares thereafter.
Grey market premium
In the grey market, shares of Chatha Foods are holding a 9 per cent premium or Rs 5 apiece over the upper band price of Rs 56, as per ipowatch.in.
Anchor issue
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The company has allocated nearly 1.7 million shares to anchor investors at Rs 56, raising Rs 9.5 crore ahead of the IPO through the anchor placement.
Negen Undiscovered Value Fund bought 442,000 shares, the largest portion in the anchor issue. The fund already had invested in the company in 2023 and holds a 10 per cent stake in it.
Other anchor investors included Persistent Growth Fund, Aurum SME Trust-I, Mauryan Fund, Nakshatra Stressed Assets Fund and Saint Fund. Check here
Other anchor investors included Persistent Growth Fund, Aurum SME Trust-I, Mauryan Fund, Nakshatra Stressed Assets Fund and Saint Fund. Check here
Business profile
The Punjab-based processes frozen, ready-to-eat non-vegetarian and vegetarian food products and supplies to hotels, restaurants and catering businesses. Non-vegetarian products make for the majority of its earnings. It forayed into vegetatrian products only recently in 2022.
The company serves top quick serving restaurants (QSR), casual dining restaurants (CDR) and other players in the hotel-restaurant-catering (HoReCa) segment.
For six months ended Sept 30, 2023, Domino’s India franchise accounted for 44 per cent of its revenue in this period.
Subway’s India franchise made up 27 per cent, Cafe Coffee Day at 1.24 per cent, Chili’s & Pauls at 2.26 per cent, Wok Express at 3.45 per cent and Burger Singh accounted for 0.76 per cent for the company's revenue for April-Sept 2023.
It also sells products under its own brand “Chatha Foods” through a network of 29 distributors, catering to 126 mid segment and standalone small QSR brands.
Financial performance
*0.67= Rs 67.24 lakh Source: Company RHP
The loss in FY21 was primarily due to adverse impact of Covid-19 pandemic on the QSR industry, which also led to negative cash flows for this period, the company said.
| in Rs crore | FY23 | FY22 | FY21 |
| Revenue | 117 | 87 | 61.18 |
| Net profit/ loss | 2.45 | 0.67* | -4 |
*0.67= Rs 67.24 lakh Source: Company RHP
The loss in FY21 was primarily due to adverse impact of Covid-19 pandemic on the QSR industry, which also led to negative cash flows for this period, the company said.
