Offer period Bid/Offer Opens On: Wednesday, 16th June,2021
Bid/Offer Closes On: Friday, 18th June, 2021
Issue Details Fresh Issue of Equity Shares aggregating up to Rs. 50 Cr.
Offer for sale of 10,985,444 Equity Shares
Issue Size(in Crore) Rs. 512.49 - 520.18 Cr.
Price Band Rs. 421 - 428
Bid Lot 35 shares and in multiple thereof
QIB 50% of the net offer (Rs. 258.80 - 260.09 Cr.)
NIB 15% of the net offer ( Rs. 76.87 - 78.03 Cr.)
Retail 35% of the net offer (Rs. 179.37 - 182.06 Cr.)
Registrar KFIN Technologies Pvt. Ltd.
Positives: (a) Consumer focused dairy company with a diverse range of products
under the “Dodla Dairy” and “Dodla” brands (b) Integrated business model with
well-defined procurement, processing and distribution capabilities (c) Focused
engagement and long term relationship with dairy farmers (d) Experienced
Board and senior management team.
Investment concerns: (a) DDL reported negative consolidated profit CAGR (over
FY2018-20), hence profit growth concerns remain; (b) Inability to procure
sufficient good quality raw milk at commercially viable prices may adversely
impact the operation as milk is a key raw material for all dairy products.
Outlook & Valuation: In terms of valuations, thepost-issue 9MFY21 annualised
PE works out to 16.4x (at the upper end of theissue price band), which is low
compared to Parag Milk Foods (trading at 32.7x). Further, DDL has shown
improvement in operating margin with efficient working capital cycle. Going
forward, we believe that DDL would perform better on the back of increase in
value added product mix. Thus, we recommend a subscribe rating on the issue
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