Biscuit and bread maker Mrs Bectors Food Specialities is looking to raise Rs 550 crore through an initial public offering (IPO), according to the draft offer document filed by the company with SEBI. The IPO would comprise of a fresh issue of equity shares worth Rs 50 crore and an offer for sale (OFS) by existing shareholders worth Rs 500 crore. Started in 1978, Mrs Bectors Foods is a manufacturer of ice creams, breads and biscuits. The company sells its products under two well established brands — ‘Mrs. Bector’s Cremica’ and ‘English Oven’.
The offer would see Linus Private Limited, Mabel Private Limited , GW Confectionery Pte Ltd and GW Crown Pte Ltd line up as existing shareholders trimming their stake in the company. Linus Private Limited will sell its stake worth Rs 245 crore while Mabel Private Limited will sell shares worth Rs 35 crore. GW Crown will sell equity shares worth Rs 192 crore and GW Confectionery will sell stake worth Rs 27.5 crore. Prior to the offer, the promoter and promoter group of the company holds a 52.45% stake in the pre-offer equity share capital while selling shareholders have a 46.75% stake. The promoter and promoter group is not selling their stake through the IPO.
Mrs Bectors Foods said that it would use Rs 40.5 crore of the net proceeds for financing the project cost towards Rajpura Expansion Project and the rest for general corporate purposes. The company will not receive funds from the OFS by existing shareholders. Earlier the company had received SEBI’s nod to float an IPO in 2018. SBI Capital Markets, ICICI Securities and IIFL Securities will manage the company’s initial public offer (IPO).The equity shares will be listed on BSE and NSE.
The company counts Burger King India Private Limited, Connaught Plaza Restaurants Private Limited, Hardcastle Restaurants Private Limited, and Yum! Restaurants (India) Private Limited as its clients but does not have a long-term contract with anyone. The revenue from sale of buns, bakery and frozen products to institutional clients accounted for 16.84%, 14.50%, and 13.36%, of Mrs Bectors revenue from operations in the Financial Year 2020, 2019 and 2018. CSDs and Indian Railway Canteens are also clients of Mrs Bectors Food.
Revenue of Mrs Bectors has increased from Rs 695 crore in financial year 2018 to Rs 764.9 crore in the last fiscal year. With increasing expenses the net profit has decreased from Rs 35 crore in financial year 2018 to Rs 30 crore in financial year 2020.