Gopal Namkeen Initiates IPO to Raise Rs 650 Crore: Key Details to Know

Gopal Snacks, known as Gopal Namkeen, has initiated its initial public offering (IPO) aiming to raise Rs 650 crore. The savory snack manufacturer’s offer comprises a pure offer for sale of 1.62 crore shares, with its anchor book scheduled to open on March 5.

Here are the key details you should know:

1. IPO Dates:
   The IPO will be open for subscription from March 6, 2024, to March 11, 2024.
2. Price Band:
   The price band for the issue has been set at Rs 381-Rs 401 per share.
3. Offer Details:
   Promoters Gopal Agriproducts and Bipinbhai Vithalbhai Hadvani aim to raise Rs 650 crore through the offer, with equity shares worth Rs 520 crore and Rs 80 crore in the OFS, respectively. The remaining Rs 50 crore will be divested by Harsh Sureshkumar Shah. Currently, promoters hold 93.5 percent shares, while the public shareholders, including Axis Growth Avenues AIF – I and Ashoka India Equity Investment Trust Plc, own a 1.48 percent stake each.
4. Objectives of the Issue:
   As it’s an offer for sale, the company will not receive any proceeds from the offer, and all proceeds will go to the selling shareholders.
5. Lot Size:
   Investors can bid for a minimum of 37 equity shares and in multiples thereof. Thus, the minimum investment for retail investors would be Rs 14,097 (37 (lot size) x Rs 381 (lower price band)). At the upper end, the bidding amount will increase to Rs 14,837.
6. Company Profile:
   Established in 1999, Gopal Snacks is an FMCG company engaged in the production of ethnic and Western snacks, as well as other products in India and internationally. Its product range includes namkeen, gathiya, wafers, extruded snacks, snack pellets, papads, spices, gram flour, noodles, and rusk.
7. Financials of the Company:
   In FY23, the company reported a revenue of Rs 1,394.65 crore, with a CAGR of 11.15 percent during FY21-FY23. The net profit CAGR stood at 130.65 percent, reaching Rs 112.4 crore during the same period, driven by strong operating performance.
8. Lead Managers:
   Intensive Fiscal Services Private Limited, Axis Capital Limited, and JM Financial Limited are the book-running lead managers of the Gopal Namkeen IPO, while Link Intime India Private Ltd will act as the registrar for the issue.
9. Key Risks:
   i. Approximately 90 percent of the company’s revenue is derived from snacks, gathiya, and pellets, making it vulnerable to changes in consumer preferences.
   ii. Gujarat accounts for around 80 percent of its sales, posing a risk if operations in the state are affected.
   iii. The company has faced notices under the Food Safety and Standards Act, 2006, for alleged substandard products and misleading advertisements.
   iv. Gopal’s manufacturing facilities are concentrated in Gujarat, making it susceptible to disruptions in the state.
10. Listing Date:
    The Gopal Namkeen IPO is expected to list on BSE and NSE on Thursday, March 14, 2024.