Apex Frozen Foods Ltd’s Rs 152 crore IPO, which opened today, was subscribed 40% at the end of the first day of bidding. The IPO consists of up to 87,00,000 equity shares of face value Rs 10 at a price band of Rs 171-175 per equity share, including a fresh issue of 72,50,000 shares and an offer for sale of 14,50,000 shares by promoters. The company will not receive any proceeds from the offer for sale of promoters’ 14,50,000 shares.
The portion set aside for qualified institutional buyers (QIBs) couldn’t even see a single subscription today while non-institutional investors category was subscribed 18.09%, Retail investors category was subscribed 78.41% and shares reserved for employees was subscribed 0.26%.
Apex Frozen Foods Ltd (AFFL) is an integrated producer and exporter of shelf stable quality aquaculture products. It supplies ready-to-cook products to a diversified customer base consisting of food companies, retail chains, restaurants, club stores and distributors spread across the developed markets of USA, UK, and various European countries. The company sells its products under the brands Bay fresh, Bay Harvest and Bay Premium. It strategically focuses on the market of the USA, which is the largest importer of aquaculture products in the world.
AFFL has a total workforce of 1,344 employees in the Company. As per the standalone financial statements, its total revenues grew from Rs 2,554.83 million in FY13 to Rs 7,096.80 million in FY17, at a CAGR of 29.10%, and the PAT grew from Rs 94.15 million in FY13 to Rs 244.05 million in FY17, at a CAGR of 26.89%.
HDFC Securities has identified various strengths in the company including economies of scale on account of integrated operations; strategically located processing plant and established customer relationships. Its integrated operations comprise of the hatchery, farming, preprocessing, processing and exporting of aquaculture products. The research and brokerage firm says that Apex Frozen Food Ltd’s products and processes comply with stringent quality standards set by the developed markets it serves.
The book running lead manager for the IPO of Apex Frozen Food Ltd is Karvy Investor Services Limited. The IPO closes on August 24.