Packaged foods maker, Bikaji Foods International Ltd. has acquired 49 percent stake and 396 Compulsorily Convertible Debentures (CCDs) in Bhujialalji Pvt. Ltd., an upcoming company in the ethnic snacks industry, according to a filing to the stock exchange.

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The shares of Bikaji Foods International surge 7 percent in trade on July 19 at noon.

The deal comprised of 9,608 equity shares and 396 CCDs at Rs 5100 value per security aggregating to Rs 5.10 crore. The face value is Rs. 10 per equity share.

Bhujialalji Pvt. Ltd. is a new entrant to this industry with its product portfolio comprising popular Bhujia and namkeen variants. "Our vision is to reach every household in India and this is our small step towards the big growth plans," says Mr. Deepak Agarwal, Managing Director, Bikaji Foods International Limited.

Bhujialalji was incorporated in May 2021 with an annual turnover of Rs. 18.08 Crore and a Net Worth of Rs. (3.03) Crore as on March 31, 2023. The acquisition is completed on July 19, 2023.

This acquisition comes at a time when India’s organised snacktionary business is currently valued at Rs 4.2 lakh crore. It has grown significantly in last five years on account of changing lifestyles, rising incomes and urbanization. In FY15, the packaged food retail revenue was worth Rs 2.4 lakh croreand has registered a CAGR of approximately 8.3 percent from FY15 to FY22. It is

estimated to grow at CAGR of 8 percent in next five years to reach at Rs 5.8 lakh crore billion, according to a Frost & Sullivan report.

Indian Savoury Snacks market is valued at Rs 75,00 crore in 2022 and is expected to reach Rs 1.2 lakh crore by 2026 at CAGR 13 percent.

Axis Capital says the company's initiatives to augment capacities (near-completion) and drive distribution expansion coupled with raw material tailwinds and PLI benefits are likely to help it sustain a strong growth. The brokerage has a target price of Rs 500 and buy rating. The brokerage expects robust revenue and profit after tax CAGR of 18 and 35 percent from FY23 to FY26 led by a strong 16 percent volume CAGR and 290 bps expansion in EBITDA margin to 14 percent.

Bikaji is the largest manufacturer of Bikaneri Bhujia with an annual production of 35,588 tonnes in FY23. It is the second fastest growing company in the Indian organized snacks market. In FY23, the company's consolidated sales stood at Rs 1,967 crore compared with Rs 1,610 crore in FY22. EBITDA grew to Rs 214 crore in FY23 from Rs 140 crore in FY22.

First Published:Jul 19, 2023 11:52 AM IST