{"id":741,"date":"2021-06-11T12:59:26","date_gmt":"2021-06-11T12:59:26","guid":{"rendered":"https:\/\/www.invest19.com\/blog\/?p=741"},"modified":"2021-06-12T04:56:23","modified_gmt":"2021-06-12T04:56:23","slug":"dodla-diary-will-hit-the-primary-market-on-june-14-should-you-subscribe","status":"publish","type":"post","link":"https:\/\/www.invest19.com\/blog\/dodla-diary-will-hit-the-primary-market-on-june-14-should-you-subscribe\/","title":{"rendered":"Dodla Dairy Will Hit The Primary Market On June 16. Should You Subscribe?"},"content":{"rendered":"<div style=\"margin-top: 0px; margin-bottom: 0px;\" class=\"sharethis-inline-share-buttons\" ><\/div>\n<p>In times when valuations reach their premium levels, market participants restrict themselves from initiating addition of stocks in their portfolio. The benchmark indices are trading at phenomenal highs and adding stocks under these circumstances seems scary. However, promoters from unlisted companies have distinct view over the performance of market in near term. We will always remember June, 2021 for a wave of IPOs. Starring from Shyam Metalics, Blackstone-based Sona Comstar and KIMS Hospitals, the promoters of Dodla Dairy have decided to launch heir IPO for subscription on June 16, 2021.<\/p>\n\n\n\n<p>The issue size of 520.18 crores is a mix of fresh issue of Rs. 50 crores and offer for sale of Rs. 470.18 crore by TPG Dodla Dairy Holdings, Dodla Sunil Reddy, Dodla Family Trust and Dodla Deepa Reddy. According to Draft Red Herring Prospectus, the issue comprises of Rs. 50 crores to be raised from issuance of fresh equity will be utilized for repayment of company debt amounting at 32.26 crores. An amount of Rs. 7.15 crores will be channelized for capital expenditure while the rest will be utilized for general corporate purpose.<\/p>\n\n\n\n<p>Must Read: <a href=\"https:\/\/www.invest19.com\/blog\/blackstone-backed-sona-comstar-will-hit-the-primary-market-on-june-14-should-you-subscribe\/\">Blackstone backed Sona Comstar Will Hit The Primary Market On June 14. Should You Subscribe?<\/a><\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"counter-hierarchy counter-decimal ez-toc-grey\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\"><i class=\"ez-toc-glyphicon ez-toc-icon-toggle\"><\/i><\/a><\/span><\/div>\n<nav><ul class=\"ez-toc-list\"><li><a href=\"#Dodla_Dairy_IPO_Details\" title=\"Dodla Dairy IPO Details:\">Dodla Dairy IPO Details:<\/a><\/li><li><a href=\"#About_the_Company\" title=\"About the\nCompany\">About the\nCompany<\/a><\/li><li><a href=\"#Industry_Growth_Drivers\" title=\"Industry Growth Drivers\">Industry Growth Drivers<\/a><\/li><li><a href=\"#Peers_Comparison\" title=\"Peers\nComparison\">Peers\nComparison<\/a><\/li><li><a href=\"#Financials\" title=\"Financials\">Financials<\/a><\/li><\/ul><\/nav><\/div>\n\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Dodla Dairy IPO Details:<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\"><li>Issuer Company: Dodla Dairy.<\/li><li>Industry: \u00a0FMCG<\/li><li>IPO Size: 520.18 cr.<\/li><li>Price Band: 421-428<\/li><li>Issue Open Date: 16 June, 21<\/li><li>Issue Close Date: 18 June, 21<\/li><li>Listing Date: 28 June, 21<\/li><li>Minimum Lot Size: 35 shares<\/li><li>Face Value: 10 Rs. Per share<\/li><li>Retail Allocation: 35%<\/li><li>Listing Exchange: NSE, BSE<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>About the\nCompany<\/strong><\/h2>\n\n\n\n<p>Dodla Dairy Limited is a public limited company having its\nregistered and corporate office at Hyderabad City of Telangana State in India.\nThe company was incorporated in the year 1995 and production commenced in 1997.\nCurrently, the procurement is centered in 5 states and our products are available\nfor purchase in 11 states. They have 94 milk chilling centers. The distribution\nand marketing operations consist of distribution of the products through 40\nsales offices, 3336 distribution agents, 863 milk distributors and 449 milk\nproduct distributors across nine states in India. Additionally, As of December\n31<sup>st<\/sup>, 2020, the products of the company are also available through\n371 \u201cDodla Retail Parlors\u201d which commenced operations in 2016 and are spread\nacross the states of Andhra Pradesh, Telangana, Tamil Nadu and Karnataka. The\nproduct portfolio of the company consists of Milk, Butter Milk, Ghee, Curd,\nPaneer, Flavoured Milk, Doodh Peda, Ice Cream and Milk Based Sweats. These\nproducts are conveniently packed to suit various needs of its consumers.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Industry Growth Drivers<\/strong><\/h2>\n\n\n\n<p>The second wave of Covid-19 seems passed away as the situation is under the control of medical authorities and restrictions on movement of activities have been relaxed. Now, industries will continue with their expansion phases and thing will run smoothly. Apart from rural growth, consumption from urban areas will start gaining strength. A country of second largest population is big enough to consume all the FMCG produce. The dairy and milk products industry is expected to\u00a0 grow at a CAGR of 10-11% in upcoming five years. Looking at the composition of Indian population, Indian population has a median age of 28 years which requires a lot of protein consumption. As per the spending pattern, Indian households spend 6.5% of their total income on the dairy products. It is expected to grow further as people are getting more cautious towards their health and protein consumption will be continuously required to remain healthy. The rising culture of urbanization banks upon purchases from organized players due to high reliability on quality as any purchase from unorganized players create fear of contamination. Therefore, the industry growth in dairy products is expected grew consistently in volume and prices.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Peers\nComparison<\/strong><\/h2>\n\n\n\n<p>The growth of an IPO is projected on the valuations of listed\npeers available on the exchanges. In terms of operations, the company has one\nlisted peer; Hatsun Agro. The white products FMCG producer has delivered multi-bagger\nreturns for its investors. On the valuations side, the company is trading at\n82.7 P\/E multiple having a Book value of 47.4. ROE stands at 25.6% and company has\na debt of Rs. 1,306 crores.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Financials<\/strong><\/h2>\n\n\n\n<p>On the financial front, the revenue of the company is growing at a CAGR of 16%. The long term borrowing of the company stood at Rs. 82 crores, which will be partially paid from the net proceeds of fresh issue. Company has been able to generate healthy cash flows last year without increasing their leverage. &nbsp;Post-listing, the company is expected to increase their returns on equity and capital employed. Operating margins of the company stand at 6.86% which is the only reason to worry. Considering the upper price band and FY20 Earning Per Share (EPS), the company is demanding a P\/E multiple of 47.7x, lower than the listed peers. <\/p>\n\n\n\n<p>Also Read: <a href=\"https:\/\/www.invest19.com\/blog\/shyam-metalics-will-hit-the-primary-market-on-june-14-should-you-subscribe\/\">Shyam Metalics Will Hit The Primary Market On June 14. Should You Subscribe?<\/a><\/p>\n<div class='epvc-post-count'><span class='epvc-eye'><\/span>  <span class=\"epvc-count\"> 2,516<\/span><\/div><div class=\"pld-like-dislike-wrap pld-template-1\">\n    <div class=\"pld-like-wrap  pld-common-wrap\">\n    <a href=\"javascript:void(0);\" class=\"pld-like-trigger pld-like-dislike-trigger \" title=\"\" data-post-id=\"741\" data-trigger-type=\"like\" data-restriction=\"ip\" data-ip-check=\"0\" data-user-check=\"1\">\n                        <i class=\"fas fa-thumbs-up\"><\/i>\n                    <\/a>\n    <span class=\"pld-like-count-wrap pld-count-wrap\">7    <\/span>\n<\/div><\/div>\n\n","protected":false},"excerpt":{"rendered":"<p>In times when valuations reach their premium levels, market participants restrict themselves from initiating addition of stocks in their portfolio. The benchmark indices are trading [&hellip;] <span class=\"read-more-link\"><a class=\"read-more\" href=\"https:\/\/www.invest19.com\/blog\/dodla-diary-will-hit-the-primary-market-on-june-14-should-you-subscribe\/\">Read More<\/a><\/span><\/p>\n","protected":false},"author":1,"featured_media":749,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[70,2,7,10],"tags":[],"class_list":["post-741","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-ipo","category-stock-market","category-investment","category-featured"],"_links":{"self":[{"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/posts\/741","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/comments?post=741"}],"version-history":[{"count":4,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/posts\/741\/revisions"}],"predecessor-version":[{"id":750,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/posts\/741\/revisions\/750"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/media\/749"}],"wp:attachment":[{"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/media?parent=741"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/categories?post=741"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/tags?post=741"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}