 "Agri input firms' short-term margins to remain under pressure on price cut")
The initial public offering (IPO) of small and medium enterprise (SME) Vishwas Agri Seeds will open for subscription on Thursday, March 21 and close on Tuesday, March 26.
The IPO consists only a fresh issue of 3 million shares at a price band of Rs 86 per share, meaning a fundraise of Rs 25.8 crore. The stock will get listed on the Emerge Platform of the NSE.
The company aims to use Rs 4 crore of the IPO proceeds to furnish its corporate office building, Rs 1.5 crore to buy equipments to set up seed testing laboratory, another Rs 1.5 crore to set-up a greenhouse (fan-pad system) and Rs 60 lakhs to install roof top solar monocrystalline panels (129.6KW).
Additional working capital requirement will use Rs 11 crore of the proceeds, as per the draft papers.
Grey market
The stock saw no demand in the grey or the unlisted market as it was flat without any premium, as of 12:30 pm, showed chittorgarh.com.
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Business profile
The company operates in the agri sector, more specifically, in the business of processing seeds to supply to farmers. The seeds are sold under the brand name "Vishwas".
After starting seeds processing unit at Gondal, Rajkot, it ceased operations in this unit in June 2023 to migrate to a larger facility in Ahmedabad.
In the new facility, its seed processing is operating along with a warehouse and cold storage facility. The company has availed term loan of Rs 11.5 crore from HDFC Bank to construct the factory shed and cold storage.
The said unit, equipped with the warehouse, can store 4200 MT (metric ton) of stock and cold storage facility can store 3000 MT of stock. It is now setting up its corporate office building in the premise of the said seed processing unit.
Its plan to setup an in-house seed testing laboratory is to enable it improve the quality of its existing products and come with new products and variants.
As of March 31, 2023, Vishwas produced seeds for more than 40 different field crops, vegetables. It has more than 75 varieties of crops and its product portfolio includes seeds for groundnut, soyabin, wheat, cumin, green gram, black gram, among others.
The brand “Vishwas” enjoys a strong presence in the market, the company claims, as over the years it has developed a robust network of distributors across states like Gujarat, Rajashtan and Madhya Pradesh.
It has a network of over 780 distributors and a sales and marketing team of about 18 employees responsible to devlop new distributors.
"Our promoters also keenly interact with the distributors on a regular basis which helps us have strong insight of the overall market and changing demand conditions, " it said in the draft papers.
Further, its large capacity to store the seeds and further process and pack them during the sowing season gives it an advantage over its competitors to supply its proudcts to end user (farmer) quickly, it said.
Financial metrics
Source: Company DRHP
| (in Rs crore) | FY23 | FY22 | FY21 |
| Revenue | 65.3 | 64.9 | 53.8 |
| Net profit | 5.3 | 2.48 | 1.16 |
