HINDUSTAN FOODS

Hindustan Foods

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Proxy play for entire FMCG sector

Biz: Contract manufacture of FMCG goods.

Journey and Vision
capex Update
Progress during the quarter
  • Reckitt acquisition is complete
  • IceCream plant in UP is ready to produce – 2023 summer would be peak season
  • Beverages plant is picking up steam
  • Bars and Soaps project seems to have started working
  • Capex at coimbatore beverage plant indicates strong momentum

Management Commentary and YOY results comparison

Company’s growth (organic + inorganic)
Brand behind the brands – Contract Manf
Evolution & growth levers
Edge over others
Financial statements FY22 at a glance – PL, Balance sheet, cashflow statements

Whats next?

  • Co is seeking approval to raise 300Crs through QIPs during AGM on 22nd sep, 2022
  • Need to watch the participant and success rate + management commentary about utilisation of proceeds from fund raising
  • target of 4000cr revenue in FY25 could make its market cap reach 15000Cr (from current 5300cr) and might lead to re-rating of the ticker.

Risks:

  • Big Cos stepping out from contract manufacturing (very rare but can’t rule out)
  • Management changes.
  • Inorganic expansion might lead to too much diversification. Should closely watch the revenue contribution from such M&A.

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