Mrs. Bectors Food Specialities Ltd.: After listing at 74% premium, analysts expect further 10-15% upside in Mrs Bectors Food

Mumbai: Mrs Bectors Food Specialities, a premium biscuit maker and supplier of buns to restaurant chains, made a strong debut on the bourses on Thursday with the stock doubling on listing over its issue price. The stock, which listed at a 74% premium over its issue price of Rs 288, closed 106% above the offer price. Shares of Burger King India, which listed earlier in December, too doubled on debut.

Mrs Bectors listed at Rs 501 on the BSE against the offer price of Rs 288 and touched a high of Rs 601.2.

“Pricing in relation to peers and the FMCG business was attractive, which led to the bumper listing. There may still be about 10-15% upside from hereon because the market sentiment is positive,” said Geetanjali Kedia, senior analyst at SPTulsian.com.

The company’s Rs 540.5 crore IPO which closed on December 17 was subscribed 199 times at the end of final day of the issue — the highest subscription for any Indian IPO since Salasar Techno Engineering IPO in July 2017. HNI portion was subscribed 625.2 times, while institutional subscription was 178 times and the retail portion was subscribed 29.5 times.

The bakery product maker’s initial public offering consisted of a fresh issue of Rs 40.5 crore and offer for sale of Rs 500 crore by existing shareholders.
Angel Broking believes that at current valuations, there are better investment options available in the fast-moving consumer goods space in the market than Mrs Bectors.

“…short-term investors may consider booking profit. Now, stock is trading at 57.2 times PE on a trailing basis,” said Keshav Lahoti, associate equity analyst at Angel Broking. “Although we are bullish on Mrs Bector’s long-term prospects, at these valuation, we believe there are better investment options available in the FMCG space in the market,” said Lahoti.