SME IPO: Ace investor Ashish Kacholia-backed TBI Corn files draft papers for IPO

TBI Corn's shares will be issued at a price band of around Rs 90-93 per share, sources told Moneycontrol

TBI Corn Limited (TBICL) has filed the draft red herring prospectus (DRHP) with Sebi for raising funds through a public offer, and will issue upto 50,00,000 fresh equity shares.

The shares will be issued at a price band of around Rs 90-93 per share, sources told Moneycontrol.  At the upper price band, the company will raise Rs 45 crore.

Ace investor Ashish Kacholia's name features in the list of investors in TBICL, as per the DRHP document. GJNX ventures backed by Gunavanthkumar Vaid, widely known for his preference for SME and small cap companies, also features in the list of investors.

About TBI Corn Limited (TBICL):

Yogesh Laxman Rajhans is the promoter of TBICL, which was earlier known as “The Best India”. The Best India was incorporated in the year 2000.

TBICL is a prominent player in the corn milling industry. Located in the Sangli district of Maharashtra, India, TBICL specializes in the production of high-quality Corn / Maize Grits and related products. TBICL offers a diverse range of products, including cleaned and fat-free Corn Grits/Meal, Corn Flakes, Stonefree Broken Maize & Corn Flour, and Turmeric Finger, all manufactured without chemical additives or preservatives and GMO-free.

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Objects of the issue:

Proceeds from the fresh issue will be utilized towards the expansion of existing unit and to meet the incremental working capital requirement as per the DRHP.

The filing details suggests that TBI Corn intends to shift focus from domestic demand and urgently cater to the requirements of international clients. The expansion of existing units is required to cater to the growing demand. The dry milling industry is growing propelled by changing food consumption patterns and the increasing global population. Dry milled corn products find extensive use in the extruded snacks industry, aligning with the rising demand for convenience and ready-to-eat food products.

Financials

TBI Corn's revenue from operations stood at Rs 70.37 crore for the six month period ending September 2023, while it was Rs 115.47 crore for the period March 2022 to March 2023. The profit for the six-month period ended September 2023 was Rs 6.67, while it was at Rs 6.37 crore in March 2022 to March 2023.

The EBITDA was reported at Rs 11.10 crore for the period April, 23 to September 23 while it was at Rs 11.37 crore for the period June 22 to March 23. The profit margin was reported at 9.48 percent and EBITDA margins stood at 15.78 percent for the period April, 23 to September 23. For the period June, 22 to March 23 the profit margins stood at 5.52 percent and the EBITDA margins at 9.85 percent.

The debt to equity ratio was 0.46 as on September 2023. The RoE stands at 16.82 percent.

Risk Factors:

The operations are dependent on the requirements from the top 10 customers, that generated Rs 23.24 crore and Rs 55.26 crore of revenue, which was almost 33.19 percent and 39.75 percent of the total revenue generated as on September 30, 2023 and March 31, 2023, respectively. The domestic sales are dependent on the top five states including Maharashtra, Gujrat, Tamil Nadu, Karnataka and Madhya Pradesh.

Swastika Investmart and Ekadrisht Capital are the lead managers for the issue. The shares offered through this issue are proposed to be listed on the SME platform of the NSE.

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