Himalya International - A Turn around Story?


(Arun) #21

Quarterly results for December 2016.

1.Sales at 27.9 crores on December 2016 quarter compared to 33.6 Crores in September 2016.

2.Sales lower and closing stock is higher than the last quarter due to impact of demonetization in November and December.

3.Net profit at .77 Crores.

4.Approval /Observation letter received from BSE/SEBI. To file for statutory approval of the scheme by High court /NCLT for speedy implementation of the “Scheme of Demerger”.

5.To show case Healthy Series & Guilt Free Series product in US and Gulf Food Show in Dubai.


(Arun) #22

Product Brochure 2017.

http://www.himalyainternational.com/corporatre/2017brochure/2017brochure.pdf


(Arun) #23

Demerger Ratio


(Arun) #24

Himalya International unhurt by note ban, clocks 80% growth in December quarter


(spiderman) #25

From Annual Report and Technical Chart

Dear Shareholders,
Greetings from Himalya International Ltd. I am pleased to share with you that after series of annihilating events since 2013 the company is back in traction. The operations have stabilized and we have been able to reverse the steep slide of FY 2015 by clocking 12.56 % increase in sales from 100.92 crore in FY 15 to 113.59 crore in FY 16. The operating profit also increased from Rs. 6.80 crore to Rs. 17.04 crore. There has been a major boost in our export sales by 137% during FY16. The Company has met all its legal and financial obligations during the last FY. We successfully persisted in repelling the arbitration proceedings initiated by Simplot at Singapore and High Court of Singapore decided in our favour and the proceedings have been set aside. We have been diligently pursuing our claims on Simplot for their act of abandonment of our ransacked Gujarat facility and the matter is likely to be awarded in the current FY. We have also pursued the Insurance claim for US warehouse fire and the case is under active mediation proceedings in USA. We expect this to be concluded in current FY. We propose to Reorganize the assets of the company under provision 391 - 394 to the Companies’ act 1956 and subsequent provision in Companies Act, 2013, subject to ‘In principle’ approval from all stakeholders. The current structure of multi locational and diversified assets is restricting participation by potential fresh investors who are interested in parts of what we have, but are hesitant for the complete multi locational diversified activities. The first unit of the company established in 1995 diversified into various segments that included Dairy, Appetizers and Potato Products. This project is in extreme North of India and is far from Major ports and thus is handicapped for export production. The production from this plant is at disadvantage compared to Gujarat plant due to huge freight costs involved. In 2010, Company started building a new, modern and larger unit at Vadnagar Gujarat. This Project is one of the largest units in India with large capacities for French Fries, Frozen appetizers, Dairy and canning. Major investment was made in this project from 2011 to 2013. This project being close to Mundra port is idle for exports and whole of western & South India. It is in the special potato growing belt of the country suitable for fried potato products like French Fries. Most of the investment made at Gujarat is yet to become productive and especially the 10 TPH French Fry line already imported is to be installed and project is yet to be completed requiring further investments. The present corporate structure after debt restructure of the company in 2014 is a handicap and dissuades any fresh investment to complete the project and put all assets to optimal use. The restructured entity will have clear focus on Exports from Mundra port and use the major potential of specialty potato grown only in Gujarat. The restructured separate entity due to its sheer size & locational advantages is contemplated to be a big attraction to large national & international food industry players to invest, execute and manage the project. Company also has substantial investment in agriculture land in Rajasthan and the land is not yielding any revenues. This is 13.5 Hectare Agriculture land on NH8 in Rajasthan and has good real estate potential being surrounded by major industrial zones and it falls in the Delhi Mumbai Freight corridor being developed by the GOI. MESSAGE FROM THE CHAIRMAN 25th Annual Report YEAR 2015-2016 { 2 } HIMALYA INTERNATIONAL LIMITED ALL NATURAL TASTE OF PURE There are good prospects to develop EWS/LIG housing under PMAY “Housing for All by 2022" national mission declared by GOI last year. The restructured entity to undertake this project will attract national & international funding and execution skills. We believe that there can be great value creation and enhanced efficiency in the split business entities of the company under separate managements dedicated to core activity. The assets reorganization committee has been constituted and the Merchant Banker/Advisory services have been appointed to take all legal approvals including Shareholder approval /SEBI / BSE & High Court. We humbly rededicate our focussed attention to unlock the dormant potential of your company and realize all your dreams from the investments you have made. Thanking sincerely for your patience & understanding Yours truly, For Himalya International Ltd. Sd/- Man Mohan Malik Chairman With Best Wishes Dated : 18.08.2016


(Satish Earthling) #27

Company management seems not so ethical check here , http://www.firstpost.com/business/demonetisation-two-bank-managers-arrested-for-laundering-money-in-first-incident-of-fraud-3140414.html


(Arun) #28

They both are different companies. And registered as Rice exporters

http://www.rice-exporters.net/ms-indian-organic-food/

http://www.rice-exporters.net/ms-himalaya-international/


(drganesh) #29

Thanks Arun for the timely clarification


(Arun) #30

After the recent policy change of Infrastructure status for affordable housing, Himalya will stand benefit.

After demerger Himalya Green Apartments Ltd will focus on infrastructure/ real estate project for potential joint development.

The 13.5 Hectare Agriculture land on NH8 in Rajasthan and has good real estate potential being surrounded by major industrial zones and it falls in the Delhi Mumbai Freight corridor being developed by the GOI.
There are good prospects to develop EWS/LIG housing under PMAY “Housing for All by 2022" national mission declared by GOI last year.


(Arun) #31

Jatin Khemani Of Stalwart Advisors Stuns With 725% Multibagger Gain From Micro-Cap Stock

Jatin Kameni of Stalwart Adivsors explains about how he has zeroed in Tasty bites.

The details which he mentioned about Tasty Bites was similar to Himalya Foods which is also in same line of business and exporting to US.

"Jatin explained that Tasty Bite’s USP is the fact that it is exporting Indian food to NRIs in foreign countries. The NRIs are obviously deep-pocketed and have a craving for Indian food. They are willing to pay a fortune for desi food and this enables Tasty Bite to make a fortune.

“We found an owner operated business, creating a niche out of nowhere following a blue ocean strategy with lot of skin in the game and it was still only Rs 150 crore topline and we saw huge size of the market opportunity and that is when we thought it could be a great opportunity,” Jatin said with a big smile even as Ramesh Damani looked on with admiration writ large on his face."


(Shiva Prakash) #32

Correct, Himalya as business has potential to grow big unless there are management quality issues.


(Arun) #33

Its a bit old Interview in ET Now.(Sep2016). Here Man Mohan Malik explains how he view the company major assets which had a potential to grow independently.

In a chat with ET Now, Man Mohan Malik , chairman and CEO of Himalya International talks about the draft scheme of the demerger of the company.

ET Now: Can you take us through the details what is the current corporate structure like?

Man Mohan Malik: The current corporate structure is that Himalaya is a one company with three major assets.

At Paonta Sahib the oldest asset and Rajasthan that is a real estate asset on NH8 and the Gujarat asset that was added in 2011.

We feel that all these three assets have not been unlocked in the real spirit and we feel that Gujarat asset which is the largest asset with largest capacities in the country spread over 52 acres of land and it has 10 million kg capacity for mushrooms, 100 million kg capacity for potato processing and 60 million kg capacity for milk processing and a large canning unit of 15 million cans per annum. This asset has not been utilised properly in the last five years.

We had American JV and that JV failed and this asset has been lying dormant. So now we are free from the JV exclusivity and JV shackle as we have won the case in Singapore high court and we want to unlock this asset in a big way.

It is already creating lot of interest in the worldwide food industry being the largest capacity in India and it can be unlocked properly so that we can cater to the Indian market as well as exports from the closer Mundra Port.

The other part is Rajasthan land which has been lying dormant without adding any value to the company for the last 20 years, it turns up turnover in profit and we plan to develop it another new scheme of Prime Minister Awas Yojna which is the scheme for the EWS and LIG housing workers in the region of Neemrana, Kotputli which is the fastest growing industrial belt in the country.


(gaurang ray) #34

Hi Arun,
They can put the petition file of the shares demerger at last week and then court will take time of 6 month of the procedure and company will tell the other things so can you guide on this.


(Arun) #35

Hi Gaurang,

As per the company updates on 29Jan2017, they are in the process of the filing the petition. Hopefully they should file at the earliest.


(gaurang ray) #36

Dear Arun,

The procedure can take time of 6 month after filing petition date.


(Arun) #37

Yes Gaurang it may take more than 6 month.


(gaurang ray) #38

Hi Arun can you mail me([email protected])for discussion on this


(Arun) #39

Look at the new GUILT FREE product launches.
This is definitely a unique one.






(amil) #40

Hello @apavel Arun,

Excellent thread initiated, very detailed too! Thanks.

On the ‘business’ front, it seems a good business to be in. Large market size, untapped potential, Tasty Bite similarity story etc. I was reading about the company specific aspects, if we can clarify some points / concerns below:

  1. I think equity dilution is continual. From screener I see ‘share capital’ (not Reserves) continually rising… Giving that company is still in expansion and debt reduction mode, could upside of per share earnings be limited due to further dilution?

  2. I mentioned ‘debt reduction’ in pt 1. But AR 2016 says, company wants to raise US$50mm loans. That’s approx 350 Cr INR - would be twice the current debt - is company (planning to bite / biting more than it could chew?

  3. Do we have detailed breakup of mushroom vs cheese vs fries / ready to eat etc anywhere? I could not find details in AR.

  4. Any corp presentation or research report or so available to understand company profile?

  5. Promoter remuneration is indeed high (pointed earlier I guess). We cant expect promoters to behave like warren buffett but as a minority shareholder friendly measure, some cut should have happened if they are serious about turn around

  6. Going through ‘Outcome of board meeting’ of various quarters from BSE announcements, I got an impression that their plans are bold but they lag in execution. So in that sense, I would read vision 2020 as say Vision 2022 or 2023. Thus, time value, CAGR expectation and equity dilution overhang should be considered when calculating one’s expected share price in 2020 or 2022/23?

  7. No validated hypothesis here, but I see total shareholders quite high. Approx 17K public shareholders, many with few shares (less than 5000). Could this stock see some ‘churning’ of weak hands if it rallies a bit? I mean at higher prices, is it possible that share supply will be abundant thereby limiting upside before it starts a big rally if fundamentals improve?

  8. What is next in case of Simplot? Is any monetary remuneration expected? And similarly in warehouse fire case, is monetary remuneration expected (7.5K minus fees?) and by when?

  9. Any reason why they had some ‘exclusivity arrangements’ earlier? Isn’t this to be seen as a blunder (in hindsight of course) that they risked their existence on a foreign partner, no? You are giving a real option to your partner to bring you into trouble financially? Any special motivation for exclusivity?

  10. Lastly, 145 Cr m.cap and 180 Cr debt puts EV at approx 325 Cr. At 27 Cr TTM EBITDA, I see EV/EBITDA of 12x. Is this too high or is it expected of a turnaround story?

If @apavel and other seniors may please share some insights, it will help… Thanks


(Arun) #41

Hi Amil,

Thanks for the reply, with information I have gathered , I replied to your queries.

  1. This is the first company in India which introduce the Employee Stock options.

Major Equity dilution happened during the Simplot joint venture.

The company has been financing its growth mainly on issuance of equity.

During the Gujarat expansion the Company has tied up finances for the initial investment via a warrants issue, internal cash accruals and term loans of INR900 million from lenders

2.The company is planning to raise the loan from Foreign Funding with favourable LIBOR linked interest rates for payment of existing High interest Debt and Working capital and enhancement of business.

The surplus fund are proposed to be invested in Special Purpose Vehicles for French Units at Gujarat and for Project for EWS housing development by the company in Rajasthan , mentioned in AR2016

3.During the 2010 and 2011 Annual report they have provided the details. But after that I couldn’t find any details.

Sales in Kg.

4.The research report seem to be quite old which is for the year 2009 and 2010.

5.Yes agreed.

6.Yes they do have the ambitious plans. But If you see the corporate history which I have collected from various sources.

http://forum.valuepickr.com/uploads/default/original/2X/2/25d06f237ff143f533ace1ebce674efdc60da3c6.pdf

Himalya is the first company to introduce and export of PortoBello Mushrooms and also the first company to export Mozzrella cheese from India.

They are first company in the world to manufacture Fresh Mozzarella di Bufala outside of Italy. Later Italian Giuseppe Mozzillo and Flander Diary started its operation after seeing it success.

First time in India it introduced Fruit based blended Yoghurt.

During the initial stage there were limited markets for Mushroom and they have to struggle , because there is no sufficient cold storage availability and they couldn’t sell the products in the Indian Market. At the time Indian markets were not much mature enough to consume that much quantity of Mushrooms and other Frozen items.

7 .Not sure!

8.They have filed the case against Simplot to recover those damages, court case tends to take time so not sure.

For the Warehouse case 750,000 dollars amount is already settled.

9.I have earlier mentioned in my previous queries,

Reason for Joint Venture:

The reason behind the JV with JR Simplot is to market Himalya products in India and South East Asia.

And it aims at sales of $50 million in India and South East Asia markets within the next three years. Besides marketing, JR Simplot will provide technological expertise in potato farming and in production of french fries.

Old interview in Money control - http://www.moneycontrol.com/news/business/himalaya-international-forms-jvjr-simplot_546063.html

10.From the year 2010 to 2012 they have heavily invested the Gujarat plant, expecting revenue sales of $50 million in India and South East Asia with JV with Simplot

For the past 3 years after the breakup , the company has negative revenues, they couldn’t operate the Gujarat units because of the Court case and exclusive agreements . Which erodes the revenues.

Now after terminating the agreement and winning the court case in Singapore ,the revenues has been increased which is reflecting in the past 3 quarters.