HMA Agro Industries Ltd -IPO

 

We have seen a trend in recent past that whenever the market is in uptrend or bull run, companies come up with IPO and FPO to take advantage of the market rally.

This time HMA Agro Industries Limited is coming up with its Initial Public Offering (IPO). The IPO will open for subscription on June 20th, 2023, and close on June 23rd, 2023.

In this article, we will look at the HMA Agro Industries IPO Review 2023 and will cover its strengths and weaknesses.

About Company:

HMA Agro Industries Ltd is a three-star export house recognized by government of India. It’s a flagship company of HMA group which has been in the meat industry business for over than four decades.

Company is among the largest exporter of buffalo meat from India and account for more than 10 % of total export in this segment. They export globally in more than 40 countries.

 

The company now operates four completely integrated packaged meat processing units in Aligarh, Mohali, Agra, and Parbhani, and is in the process of establishing a fifth fully integrated-owned meat product processing unit in Haryana. 

The company is also in the process of acquiring an additional factory in Unnao by the second quarter of FY23. By FY23, the total in-house meat product processing capacity is estimated to be more than 4,00,000 metric tones per year divided over six distinct owned units.

Important Details of IPO :

Particulars	Details
IPO Size	₹480.00 Cr
Fresh Issue	₹150.00 Cr
Offer for Sale (OFS)	₹330.00 Cr
Opening date	June 20th, 2023
Closing date	June 23rd, 2023
Face Value	₹10 per share
Price Band	₹555 to ₹585 per share
Lot Size	25 Shares
Minimum Lot Size	1 (325 Shares)
Maximum Lot Size	13 (325 Shares)
Listing Date	July 4th, 2023

Income Statement of the company :

(Source: RHP of the company)

Financial Information of The company :

(Source: RHP of the company)

 

DIVIDEND POLICY:

FY-20 - Company has paid a dividend of 7 %.

FY-23-   Company has paid a dividend of 20%.

 

Listed Peers:

As per the offer document there are no listed peers for HMA Agro Industries Ltd.

Company Strength :

• The company exporting its products to various countries. For this purpose, it has developed strong relationship with various distributors that have also enabled them to achieve new markets.
• The company focus has been on delivering high-quality products which helped them to build strong brand value.
• The company exports its products to more than 40 countries which reduces the risk of the business and its dependence on single geography making this its core strength.

Weakness of the Company :

• The company generates more than 85 % of its revenue from the meat business and any reduction in demand or in the production of such products can hamper its overall revenue.

• This Business is highly regulated, environmental and religiously sensitive. Due to this, the company may face the risk of its plants shutting down or disruptions with respect to its processing plants which they have experienced in the past.

• The company does not have any long-term agreements with its suppliers for its raw materials supply. This can lead to cost increment, or a shortfall in the availability of raw materials.