The company has come out with draft offer for rights issue. They are planning to raise around 25 Crores. They will be spending around Rs. 8.5 crores on oil plant and storage. Promoters have declared that they shall be fully subscribing the right issue.
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Anyone attended the Concall?
The company is expecting 100% growth year to year, till 2030.
Further spice and oil is likely to be introduced in next few months.
SSFL_22072024131000_Investors_Meeting_Transcript_18072024_NSE.pdf (1.8 MB)
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Beware of any company which is giving exponential guidanceā¦ The company is yet to establish brand presenceā¦ Cannot find its products in any retailer shop in hyderabadā¦ No operating cash flows!
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Very true.
However this company is not only giving the guidance, it is achieving it consistently.
The strategy is simple, you just increase your market penetration a bit more and introduce one or two products. This year they are doing the same. Thus the guidance is believable.
The real problem in this company is financing such type of growth as it needs huge amount of working capital. Their debt level has gone up a bit. But, they have already announced a rights issue which will be able to finance this growth for some time. New production units are to be financed too.
Sharing the investor presentation.
SSFL_22072024131000_Investors_Meeting_Transcript_18072024_NSE_compressed.pdf (239.1 KB)
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The company has announced rights issue at the price of Rs. 175 a share, in the ratio of 5:1, i.e. one share for every 5 shares held on record date.
SSFL_29082024163031_Outcome_Board_Meeting_29082024.pdf (1.7 MB)
The company will get around 25 crores from the right issue.
We were expecting 1:3 dilution and price 100 earlier. Is this better or worse?
Rough calculation
Current price 303.55
Price after 1:5 dilution 243.2
Issue price 175
Discount 39%
There is nothing good or bad in rights issue. I was expecting rights issue @ Rs. 100ā¦ They are offering @175. It is good in the sense that the company will get enough capital to sustain the growth for some time. Once they reach a topline of 150-200 crores, they will be able to generate a profit of Rs. 20-25 crores, which will be sufficient to sustain growth without much capital dilution.
It is also good as it shows that the management is valuing itās shares properly.
Let us see how they perform in H1-2025.
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They said they were currently at 8 cr runrate per month. So we can expect 48cr+ for H1
That runrate is very old, they said that in around Nov. 2023. They completed FY2024 with 78 crores topline. Later the management guided almost 100% growth for a couple of years. Though I donāt know, I am expecting 60 crores topline in H1 2025 as ballpark figure.
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Yeah, they have guided for 100% growth. In the latest concall someone asked whether they are maintaining that 8cr run rate or improved that figure.
The answer for this is:
Definitely, we will try to improve. As of now, I canāt comment on this, but we are maintaining
that. Definitely, people, investors are not surprised, as already said in the many sessions and last
investors meet also, weāll maintain the growth, the kind of growth you can see. We are
maintaining and weāll maintain that. So, and I know my investors are very good at calculations,
they can calculate it, divide it by two and they can analyze that.
Its kind of mixed answer.maintaining 8cr and maintaining growth (100%)
If we take minimum of this then 48cr+
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Even at 8cr run rate the yoy growth will be 60%
Since revenues are slightly higher in h2 we cannot compare it with h2
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Anyone applying for rights issue ā¦Suppose I am entitled for 200 shares. Please help whether the following the application form is correct or not. Getting confused because of Block I and Block II
You can apply for rights issue online via internet banking. I use Axis Bank without any issues.
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Even , I want to apply through internet banking only. But I am using DBS Bank, which donāt have that facility in internet banking. Thatās why applying through physical form
Mailed to Srivari team and got a response that it is correct.
Good to see the team responding quickly
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Can I apply for more right issue through bank then I own in my demat, will I get extra if someone missed to appy?
Entire FMCG sentiment is hurt due to poor HUL result
Whatās causing this stock to bleed so much ?
Although I am negatively biased from day one, just curious to understand if there was any insider news?
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