Mrs Bectors IPO- Details, Review Analysis

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Mrs Bectors IPO- Details, Review Analysis

Mrs Bectors Food Specialities is launching an IPO of Rs 540.5 crore. The offer comprises of an offer for sale (Rs 500 crore) and a fresh issue (Rs 40.5 crore). Shares are offered for sale by Linus Private Limited (Rs 245 crore), Mabel Private Limited (Rs 35 crore) , GW Confectionary Pte Ltd (Rs 27.5 crore)and GW Crown Pte Ltd (Rs 192.5 crore)

Offer Details follow:

Offer Details    
Offer SizeRs 540.5 crore
of which
Offer for saleRs 500 crore
Fresh IssueRs 40.5 crore
Price BandRs 286-Rs 288 per equity share
Offer PeriodAnchor Book: 14th Dec
Offer opens on 15th Dec
Offer closes on 17th Dec
Offer StructureQIBs: 50%
NIIs: 15%
Retail: 35%
Market Lot50 shares
Objects of the fresh issueRs 40.54 crore are proposed to be utilised for financing new production line for biscuit segment (Rajpura Manufacturing Facility)
Listing onBSE, NSE
BRLM'sSBI Capital Markets
ICICI Securities
IIFL Securities
RegistrarLink Intime

Business Background of Mrs Bectors Food Specialities 

Incorporated in the year 1995, Mrs Bectors Food Specialities Limited (hereinafter referred as ‘BFS’) is in the business of manufacturing biscuits such as cookies, creams, crackers, digestives and glucose. The products are sold with the brand of Mrs. Bector’s Cremica. BFS is also engaged in manufacturing of breads, buns, pizza bases and cakes under the brand English Oven. Customers include retail consumers in 26 states within India and reputed institutional customers with pan-India presence. BFS had exported biscuits under own brand as well as under third party private labels to 64 countries during FY20. Mrs Bectors IPO- Details, Review Analysis

BFS product portfolio includes two categories:

Biscuits – Mrs. Bector’s Cremica is the leading biscuit brand in the premium and mid-premium segment in Punjab, Himachal Pradesh, Jammu-Kashmir and Ladakh. This segment contributed 59.20%, 69.65% and 60.82% of revenue from operations for FY20, Q1FY20, and Q1FY19 respectively. BFS also manufactures oreo biscuits and chocobakes cookies on contract basis for Mondelez India Foods Private Limited.

Bakery Products – Products like bread, buns, pizza are manufactured under the brand English Oven catering to premium segment in Delhi NCR, Mumbai and Bengaluru. This segment contributed 17.09%, 21.08% and 16.19%, of revenue from operations for FY20, Q1FY20, and Q1FY19 respectively. BFS also supplies buns in India to reputed QSR chains like Burger King India Limited, Connaught Plaza Restaurants Private Limited, Hardcastle Restaurants Private Limited, and Yum Restaurants (India) Private Limited.

The products are manufactured at in-house six manufacturing facilities located in Phillaur and Rajpura (Punjab), Tahliwal (Himachal Pradesh), Greater Noida (Uttar Pradesh), Khopoli (Maharashtra) and Bengaluru (Karnataka). The manufacturing facilities are strategically located in proximity to the target markets to minimise the freight and logistics related time and expenses.

Financial Highlights Of Bectors Food

A rising trend is seen in the financial performance for H1FY21 as compared to the previous years. For the six months, revenue from operations have increased to Rs 438.56 crore (20%increase) as against Rs 366.21 crore in H1FY19. This was due to increased sale of products in domestic as well as export category and price revision undertaken in October 2019.

Total revenues for FY20 reduced by 2.70% to Rs 764.98 crore from Rs 786.03 crore in FY19. The decline is attributable to reduction in supply of bakery products to QSR customers and reduction in export of biscuits to African countries.

PAT is showing a reducing trend in FY20 and FY19 when compared to corresponding last year. For FY20, PAT reduced by 10% to Rs 29.80 crore from Rs 33.18 crore due to the increased finance cost and depreciation cost.

Operating margins have been consistent at 12% since the last three fiscals. Net margins are 3.89% and 4.22% for FY20 and FY19 respectively.

Key Financial IndicatorsAmount in
INR crore
Q1FY21FY 20FY 19FY 18
Revenue from operations202.85762.12783.67693.97
Total Assets594.71565.72577.04511.06
Cash generated from operations39.80121.8568.3562.00

Peer Comparison

BFS faces competition from various domestic and multinational companies in India, some of which have larger market presence compared to BFS. The competitors include players such as Britannia Industries Limited, Parle Biscuits Private Limited, Nestle, ITC Limited and Anmol Industries Limited. BFS also face competition from certain regional players such as Surya Agro Food Limited.


The P/BV is 5.16 at NAV of Rs 55.76 as at 31st March 2020. At upper band price of Rs 288, P/E is 49.74 as against the industry average of 63.92.

Sector Outlook and Conclusion

The packaged food industry has seen sustainable growth in India due to the increase of packaged food consumption and awareness, and demand for quality products. Coronavirus outbreak is expected to have a positive impact on the packaged foods due to rising consumer awareness.

As per RHP, according to the Technopak Report, the premium and mid-premium category biscuits market is expected to grow at a CAGR of 9.5% from FY20 to FY25.  And the market for breads and buns retail market in India is estimated to grow at a CAGR of 9% from FY20-FY25. The outlook for the sectors remains promising although with high competition among the organised and the unorganised players competing for the market share. 

Mrs Bectors Cremica is one of the leading brands in biscuits in North India and English oven is a growing brand in breads segment. BFS has made substantial investments of approx. Rs 258 crore to increase the capacities which has resulted in increased sales volumes in the last three fiscals but profitability remains static.

Fresh issue proceeds are proposed to be further utilised for new production line for biscuit segment. The financial performance has been stable since the last three fiscals with rising trend seen in H1FY21. But BFS’s capability to sustain this performance amidst the highly competitive food industry needs to be tracked. The GMP of the issue is at high levels quoting at Rs 180 on 12th Dec 2020. Hence, one may subscribe for listing gains or mid term.

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About CA Priyanka Choudhary Jain 98 Articles
Chartered Accountant & an experienced credit analyst. She has worked with CRISIL as a Senior Credit Analyst on rating assignments including business & financial analysis in Corporates as well as the Public Finance Sector. Please mail your queries, feedback, and any suggestions to her on

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