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Mrs Bectors Food shares skyrocket 109%: Should investors book profits or hold?

Astha Jain of Hem Securities advised partial profit booking in Mrs Bectors Food shares and hold remaining shares on the day of listing.

December 24, 2020 / 03:28 PM IST

Mrs Bectors Food Specialities shares saw a stellar listing on December 24, rising as much as 108.8 percent, at which point it hit the upper circuit on both the BSE and NSE.

The stock debuted at Rs 501, a whopping 74 percent premium over issue price of Rs 288 and the rally extended upto its upper circuit limit of Rs 601.20, a gain of 108.8 percent on the BSE.

It was quoting at Rs 571, up 98.26 percent on the BSE, while on the National Stock Exchange, it was trading at Rs 571.25 after hitting an intraday high of Rs 600, at the time of writing this copy.

Experts advised booking listing profits for the short-term investor, but iterated hold call for long-term investors as it is one of the leading brands in biscuits and bakery businesses in North India.

"On listing day, short-term investors can book profit if they are making at least 50-60 percent profit on the issue price. Long-term investors can stay invested with the company," Keshav Lahoti, Associate Equity Analyst at Angel Broking told Moneycontrol.

On the other hand, the institutional Indian bakery products market is expected to grow by 20 percent due to increasing market share of quick services restaurant (QSR) chain, and the company is also gaining market share in exported biscuits, he added.

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In the long run, "we think that the company should be able to grow in line with the industry managed by the promoters having more than 25 years of sector knowledge. The company has gained market share in the H1FY21 and reported results better than its peers," Lahoti said.

Astha Jain, Senior Research Analyst at Hem Securities advised partial profit-booking.

"We are positive on long-term prospects of the company as it is one of the leading brands in biscuits and bakery businesses in North India and has established presence in retail and institutional bakery business with modern and automated production process & a focus on quality control. The company has widespread and established sales and distribution network & experienced promoter and management team," she reasoned.

Mrs Bectors Food, having a market share of around 4.5 percent in the premium and mid-premium biscuits segments, has raised Rs 540.54 crore via public issue during December 15-17 including fresh issue of Rs 40.54 crore. The company will utilise net fresh issue proceeds for financing the project cost towards expansion of the Rajpura manufacturing facility by establishing a new production line for biscuits.

Prashanth Tapse, AVP Research at Mehta Equities advised investors to add and hold shares in the long term portfolio for 2-3 years investment horizon as he foresees Mrs Bectors Food as the next Britannia in making.

"We like Mrs Bectors Food story with a unique integrated business model, having uniquely positioned in biscuits export market with approximately 12 percent share of the Indian biscuit export market and contribute more than 50 percent by value of biscuit exports," he said.

The ompany manufactures a range of biscuits under its flagship brand 'Mrs. Bector's Cremica', and bakery products in savoury and sweet categories under its brand 'English Oven'.

Mrs Bector's Cremica is one of the leading biscuit brands in the premium and mid-premium segment in Punjab, Himachal Pradesh, Jammu and Kashmir and Ladakh, while 'English Oven' is the one of the largest selling brand in the premium bakery segment in Delhi NCR, Mumbai and Bengaluru.

It is the largest supplier of buns in India to reputed QSR chains such as Burger King India, Connaught Plaza Restaurants, Hardcastle Restaurants, and Yum! Restaurants (India).

Disclaimer: The views and investment tips expressed by investment expert on Moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Sunil Shankar Matkar
first published: Dec 24, 2020 12:17 pm
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