Food Products Company Makes Strategic Investment in Hamma Foods Pvt Ltd and BVK Foods Pvt Ltd
The stock is up by 38.4 per cent from its 52-week low of Rs 211 per share.
On Friday, shares of Krishival Foods Limited gained 2.46 per cent to Rs 292 per share from its previous closing of Rs 285 per share.
The Board of Directors of Krishival Foods Limited approved significant strategic investments through its subsidiary, Melt ‘N’ Mellow Foods Private Limited. These investments include subscribing to 49% of the total paid-up share capital in both Hamma Foods Private Limited and BVK Foods Private Limited. In Hamma Foods Private Limited, a total investment of up to Rs 22 crore, in the form of equity and loan, will be made. Hamma Foods boasts a state-of-the-art, fully automated ice cream and dairy product manufacturing plant spanning 1,00,000 sq. ft. across 2.5 acres in Chhatrapati Sambhaji Nagar, Maharashtra, with a production capacity of 1,25,000 litters/day for ice cream, 15,000 litters/day for Dahi, 5,000 kg/day for paneer, and 2,000 kg/day for ghee. Similarly, an investment of up to Rs 7 crore, also in equity and loans, will be made in BVK Foods Private Limited, which operates a modern production facility for ice cream and bakery products. This 35,000 sq. ft factory, spread over 1 acre in Chhatrapati Sambhaji Nagar, Maharashtra, has a production capacity of 25,000 litres/day for ice cream and 3,000 kg/day for bakery products. Both acquisitions are considered related party transactions due to common directorship, and the 49% stake acquisition in both entities is expected to be completed by July 31, 2025, via all-cash consideration.
These acquisitions are poised to substantially expand Melt ‘N’ Mellow Foods Private Limited's production capacity for ice creams and dairy products, and also provide access to bakery product manufacturing. For both Hamma Foods, incorporated in 2019, and BVK Foods, incorporated in 2021, Krishival Foods Limited, through its subsidiary, Melt ‘N’ Mellow Foods Private Limited, will nominate three out of five directors to their respective boards, ensuring strategic alignment and oversight. These moves are crucial for enhancing and diversifying Melt ‘N’ Mellow’s production portfolio.
Furthermore, Krishival Foods Limited will make a further investment of up to Rs 10 crore in the form of equity and loan in its wholly-owned subsidiary, Siddhivinayak Cashew Industries Private Limited. This investment is earmarked for the development of state-of-the-art manufacturing facilities for nuts processing. This new facility will be spread over a 5-acre land parcel owned by Siddhivinayak Cashew Industries Private Limited, located at Halkarni MIDC, Taluka Chandgad, Dist. Kolhapur, Maharashtra. These strategic financial injections, including additional loans to both Melt 'N' Mellow Foods Private Limited and Siddhivinayak Cashew Industries Private Limited, underscore Krishival Foods Limited's commitment to expanding its production capabilities across its diverse food segments.
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About the Company
Krishival Foods Ltd, established in 2014, is a prominent player in the processed nuts and dry fruits industry. The company transforms raw nuts and dried fruits into flavourful, packaged products marketed under Krishival Nuts. Their product range includes cashews, almonds, pistachios, dry figs and combo packs, which are widely available across 64 tier II and tier III cities in India. The company acquired a significant 52.94 per cent stake in Melt ‘N ’Mellow Foods Private Limited. This acquisition will allow Krishival Foods to diversify its portfolio and enter the growing food and beverage sector, gaining access to established brands and a strong distribution network.
Krishival Foods Limited reported a 97 per cent year-on-year increase in total income to Rs 206.30 crore in FY 2024-25, up from Rs 104.70 crore in FY 2023-24. EBITDA grew 66 per cent to Rs 25.23 crore from Rs 15.17 crore, and Net Profit (PAT) surged 44 per cent to Rs 13.54 crore from Rs 9.35 crore. EPS increased 39 per cent to Rs 6.08 from Rs 4.37. The 'Krishival Nuts' division saw revenue rise 67 per cent to Rs 175 crore from Rs 104 crore, with EBITDA up 50 per cent to Rs 23 crore from Rs 15 crore. The 'Melt N Mellow' ice cream brand, acquired in September 2024, posted Rs 51 crore in revenue, a 38 per cent increase from Rs 37 crore, and a remarkable 783 per cent EBITDA increase to Rs 3 crore from Rs 0.35 crore.
The company has a market cap of Rs 651 crore with a PE of 43x, an ROE of 11 per cent and an ROCE of 15 per cent. The stock is up by 38.4 per cent from its 52-week low of Rs 211 per share. DIIs bought 3,74,000 shares or a 1.68 per cent stake in the company as of March 2025.
Disclaimer: The article is for informational purposes only and not investment advice.