Prime Fresh Limited - Organized Player In F&V Industry

Overview

So Prime Fresh operates in Fruits & Vegetable Industry & Have Expertise in Souring , Processing & Distribution in the whole F&V Industry having experience of 14 years in this space.

Business

So what basically Prime Fresh does is that. It procures fruits & Vegetables from Farmers. It buys their entire produce , Hence farmer doesn’t need to look for other Alternatives to sell his produce. Currently they have around 35,000 Farmers connected with them . And Prime Fresh Wants to take this number to 50,000 in FY22. This is how they procure different different fruits across the india -

After procuring those Fruits & Vegetables from Farmers Prime Fresh Sorts , Grades & Packs them . They have 15 collection & Distribution locations. They also have Cold storage & Ripening Capabilities with them. With over 25 Post-Harvest Storage Units.

Their expertise in this space is reflected by their wastage %. Prime has wastage % below 3% in F&V Supply Chain. They are also tying up with more Cold Storage & Looking to venture into more & more Integrated pack houses. Which will help it in Exports As well as Domestic business.

Now these Fruits & Vegetables are supplied to their customers which have a large reach. Their customers are companies such as - Big Basket, Swigy, Reliance Fresh , Amazon, Zomato , Adani. This is list of all their customers-

This is their B2B Business . They recently have also started their own B2C E-Commerce platform where they sell Fruits & Vegetables. Here is the link to their Website , Go and check it out -

https://www.primefresh.in/

Product Portfolio

The company’s current product portfolio is -Mangoes, Pomegranate, Apple, Tomatoes, Onion, Orange, Grapes & Wants to expand it to more & more fruits & Vegetables

Industry

This industry has humongous potential for exports. as India is the largest producer of Fruits & Vegetables still india has just 1% market share in the whole exports markets.

Another Potential is the shift from the unorganized to the organized.

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The organized players like Prime Fresh have a humoungous opportunity as currently only 8% of the market is ogranized and it is projected that in the next 8 years it will be around 40% . Almost 3X the size in 8 years.

If we take the market share of prime in this industry as 0.4% , Prime’s vision is to make the revenue of around 2000 Cr . And the current revenue of the company is just 65 Cr.

Management

The management of the company is educationally qualified & has experience in the FMCG Industry. Like for example the Chairman of the company - Jinen Ghelani has 25 Years of experience in this field of FMCG and has previously worked at Marico

Risks

  • Seasonality

As you can see that the Fruits & Vegetables are seasonal hence the business will have this risk of seasonality of fruits & vegetables. The Availability of different fruits can be seen in this chart below -

To mitigate this risk Prime Fresh is constantly adding more & more fruits & Vegetables & Increasing their Product Portfolio. Currently their Product Portfolio has - Mangoes, Pomegranate, Apple, Tomatoes, Onion, Orange, Grapes,

And they want to diversify into - Banana, Green chilly, Sweet corn, Okra, Lemon and Drumsticks

  • Low Margin Business

The company has very less margin of around 5.6%

  • Lack of infrastructure for Exports

India doesn’t have lack of infrastructure for Exports of Fruits & Vegetables. To Solve this risk the company is doing Tie up with more & More Cold Storage’s.

Disclosure- Not Invested

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https://www.crisil.com/mnt/winshare/Ratings/RatingList/RatingDocs/PrimeFreshLimited_January%2031,%202022_RR_286725.html

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Yep this is another Risks in the company-

That isn’t not giving information about company to Crisil . Problem of lack of disclosures

Prime Fresh Planning to List on NSE/BSE Main board from SME

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Is the company migrated to nse/bse mainboard from the sme ?
The lot has changed from 3000 to 1500 shares.
When a company migrates to mainboard it trades in the multiple of one share.

But in this case the lot size has been reduced from 3000 to 1500 shares

Can anyone explain please?
Thank you

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Hi sir haven’t got time to look at updates from Prime Fresh company hence also not aware whether the migration has happened or not

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