Fratelli Vineyards Ltd - A successful business transition in play?

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Another interesting fact is the 9.52% stake of Mayank Singhal that he bought at 71. He is the Vice Chairman and MD in PI industries, a 55k crore company.
In my opinion, the inclusion of an HNI like him along with Porinju too now strengthens the outlook for the future.

Disc: Invested in the last week. Hence, biased.

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In the recent concall, management said that 65% comes from retail trade. So I guess 35% may include CSD and HORECA (just my guess).

Though in the past they havn’t done significant diluation, but its worth keep trackign this… They have already completed the capex required for the business to grow to 500Cr but the expected 100Cr fund raise will be utilized to build the resort (70%) and the remaining 30% for brand promotion of new products.

Already they have debt of 120Cr ( ~30Cr Long term and the rest working capital) and interest rate if ~10%. Going for another 100Cr debt given the size of the company looks to be too risky.

Disc: Invested.

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Q3 YOY.

Sales: 63.60 Cr vs 57.91 Cr ~9.8%
OP: -0.59 Cr -0.45 Cr
PBT: -4.95 Cr vs -3.70Cr
PAT: -8.75 Cr vs -2.77Cr

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Good to see ~10% sales growth and the wine segment generating positive ebidta given the headwinds industry is going through. PBT & PAT negative due to the losses from agri commodity trading (hope this is one off).

From SULA Q3FY26 transcript. About the doemestic price cometition.

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Disc: Invested. no transaction in the last 3 months.

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This was the last nail in the coffin for me.

Promoters themselves are not getting the warrants converted to equity shares and are letting the warrants lapse and the issue price forfeited!

8ec298c7-f301-49a9-9ea6-ba97f2966e54.pdf

“

The last date for exercising the option for conversion of warrants into equity shares was 22nd February, 2026. Since the allottees as enlisted in the attached Annexure -1 have not exercised the option of conversion within the stipulated period, the said warrants have lapsed with effect from 23rd February, 2026. Accordingly, in terms of SEBI (Issue of Capital and Disclosure Requirement) Regulations, 2018, the upfront amount of Rs. 2,72,36,250 i.e. 25% of the issue price received at the time of allotment of warrants stands forfeited by the Company.

“

Am I reading it wrong?

Discl: Exited completely at a loss.

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Nice. I see this as trying to talk up the share price while themselves not paying the remaining 75% of the share warrant price to get them converted to equity. They clearly are not putting their money where their mouth is!

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My 2 cents:

  1. Agree that converting the warrants into shares at the issued price of Rs 300 would have send the positive confidence of promoters in the business to market. At the same time the current price is less than 1/3 of the warrant price. It makes sense to buy from open market instead :)
  2. I would give more importance to the positive changes in the business rather than promoters not subscribing to the pending warrants. Many examples are there in the past for both the cases and market has rewarded the ones that were able to grow the earnings.

Disc: Invested around 120 and not transaction in the last 60 days.

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