Indian IPO

All details about Hot Indian Primary Market.

Wednesday, October 04, 2006

Dabur Foods pins turnover rider to IPO

Dabur Foods, the wholly owned subsidiary of Dabur India, plans an initial public offering, IPO once it hits the Rs 300-crore (Rs 3 billion) mark. The company is near that target having closed the last financial year at Rs 191 crore (Rs 1.91 billion), reports Business Standard.

With sales of its leading juice brands Real growing more than 30% Dabur Foods should be in a position to go for the public offering in less than two years.

Amit Burman, CEO, Dabur Foods said the company would list itself to unlock shareholder value once sales reach Rs 300 crore. He added the company targets Rs 500 crore (Rs 5 billion) by 2010.

Burman said that Dabur Foods apart its juices portfolio, comprising Real, Real Activ and Coolers, the company is also banking on trebling its exports and increasing its institutional business.

While the mother brand Real has already crossed Rs 100 crore in sales, the company hopes that both Real Activ and Coolers will each be Rs 100 crore (Rs 1 billion) brands by 2010.

Currently, Activ is Rs 40 crore brand, while the recently launched Coolers is Rs 6 crore. Burman said the juice brands will grow on the basis of increased distribution and an enhanced rural presence.

“We will enter the rural markets with Coolers which is at a lower price point than our other brands. Other beverage brands will follow the same later,” said Burman.

Burman reiterated that Dabur will focus on foods, once the beverage brands gain a critical mass. “We will focus on beverages for few years. After Activ and Coolers reach a certain stage, we will focus on foods,” said Burman.

The foods portfolio of Dabur Foods consists of cooking pastes Hommade, lemon drink concentrate Lemoneez and the Capsico range of pepper sauces.

The company also has an institutional brand, Nature’s Best that makes sauces for pizza chains like Domino’s. Burman added the company would later look at introducing sub-brands.

He said while the company was not actively looking at acquisitions, Dabur Foods would certainly consider a buy in the processed foods space.

“Exports will be the other growth area,” said Burman. Currently, the branded (Real) and bulk (concentrates, pulps) exports together constitute Rs 30 crore, which is likely to go up to Rs 100 crore in four years. “We will also start exports to countries in south east Asia soon,” he said.

Having discontinued their distribution arrangement with the Sri Lankan tea brand, Dilmah last year, Burman said the company would not look at such associations in future, as it wanted to concentrate on growing its brands.


Post a Comment

<< Home