Leo Dry Fruits and Spices IPO Listing: Stock lists at 31% premium on BSE SME

Leo Dry Fruits and Spices IPO Listing

Leo Dry Fruits and Spices IPO Listing: Strong Market Debut, Solid Growth Fundamentals, and Investor Optimism

Leo Dry Fruits and Spices, a rapidly growing company in the dry fruits, spices, and frozen foods sector, made its market debut today with the listing of its ₹25.12 crore Initial Public Offering (IPO) on the BSE SME platform.

This IPO was open for subscription between January 1st and 3rd, 2025, and has generated significant interest from both retail and institutional investors, reflecting optimism about the company’s future growth and market potential.

The shares, which were issued at ₹52 per share, have performed robustly in their debut trading session.

Opening at ₹68, the stock saw an initial surge of 30.77%, providing investors with an immediate listing gain.

However, the stock faced some volatility in the early part of the session, as profit-booking led to a dip to ₹64.60, hitting the lower circuit limit.

Despite this brief setback, Leo Dry Fruits and Spices shares bounced back, closing at ₹71.40, reaching the upper circuit limit, and providing investors with a 37.31% return by the end of the trading day.

The IPO performance demonstrates not only the company’s strong investor demand but also highlights the market’s positive view of its future growth prospects.

Overwhelming Investor Response

Leo Dry Fruits and Spices’ IPO was met with overwhelming demand, with the issue subscribed a staggering 181.77 times overall.

This high level of subscription indicates a significant interest from both institutional and retail investors, suggesting that the market sees substantial potential in the company’s business model and financial trajectory.

Here’s a breakdown of the subscription figures:

• Qualified Institutional Buyers (QIBs): The QIB portion was subscribed 68.06 times, indicating strong interest from institutional investors who typically demand more rigorous financial performance metrics.
• Non-Institutional Investors (NIIs): This category was subscribed an impressive 394.59 times, showing that high-net-worth individuals (HNIs) also found the company’s offering appealing.
• Retail Investors: The retail portion, which generally includes individual investors, was oversubscribed 154.5 times, reflecting the broad-based appeal of Leo Dry Fruits and Spices among the general public.

The substantial over-subscription in all categories suggests that investor confidence in Leo Dry Fruits and Spices is high, and there is considerable enthusiasm for its future prospects.

Company Overview: A Growing Food and Spices Brand

Founded in November 2019, Leo Dry Fruits and Spices is a relatively young but fast-growing company in the food sector.

It primarily operates in the dry fruits and spices segment under the brand name Vandu and in the frozen and semi-fried foods market under the brand FRYD.

The company has quickly become a recognized player in these niches and operates across multiple channels, including B2B (business-to-business), B2C (business-to-consumer), and D2C (direct-to-consumer), allowing it to cater to a wide range of consumers.

Despite its recent establishment, Leo Dry Fruits and Spices has quickly built a strong presence in the market, capitalizing on growing consumer demand for high-quality, healthy food products.

Its offerings include a diverse range of products, such as dry fruits, spices, and frozen foods, making it well-positioned to capture the evolving preferences of health-conscious consumers.

Financial Performance: A Track Record of Rapid Growth

Leo Dry Fruits and Spices has demonstrated an impressive financial performance since its inception, reflecting its rapid growth in both revenue and profitability.

The company’s financial trajectory highlights its ability to scale operations and maintain strong margins, which is a key indicator of its potential for future success.

In FY 2022, the company recorded a modest net profit of ₹7.9 lakh, which represented the early stages of its growth.

By FY 2023, this figure had surged to ₹3.63 crore, marking a substantial increase. In FY 2024, the company’s net profit further increased to ₹6.64 crore, demonstrating its ability to scale profitability alongside revenue growth.

Revenue growth has been similarly impressive. The company achieved a compound annual growth rate (CAGR) of more than 243% in revenue, which reached ₹62.27 crore in FY 2024.

This rapid expansion underscores the company’s robust business model and ability to capture market share in a competitive industry.

For the first half of the current financial year (April-September 2024), Leo Dry Fruits and Spices reported a net profit of ₹1.87 crore on a revenue of ₹17.88 crore.

These figures suggest that the company is well on track to continue its growth trajectory in FY 2024-25, further bolstering investor confidence in its prospects.

How the IPO Proceeds Will Be Utilized

The funds raised through the IPO will primarily be used for working capital requirements, which will enable the company to manage its day-to-day operations more effectively.

A portion of the proceeds will also be directed towards marketing expenses to further increase brand awareness and expand the company’s reach in both existing and new markets.

Additionally, the funds will be used for general corporate purposes, including investments in infrastructure, technology, and operational efficiency.

By investing in these areas, Leo Dry Fruits and Spices aims to strengthen its market position, enhance operational capabilities, and accelerate its growth in the coming years.

Market Outlook and Future Prospects

The market for dry fruits, spices, and frozen foods is growing rapidly, driven by increasing consumer demand for healthy, convenient, and flavorful food products.

Leo Dry Fruits and Spices is well-positioned to capitalize on this trend with its diverse product range and strong brand recognition in the industry.

Additionally, its focus on B2B, B2C, and D2C channels allows it to serve a wide range of customer segments, which provides a degree of diversification and risk mitigation.

The company’s strong financial performance, combined with the favorable market conditions and a robust growth strategy, suggests that it has the potential to continue delivering solid results in the years ahead.

The recent IPO and strong investor interest further validate this outlook, with many market experts predicting continued growth and expansion for the company.

Final Remarks: A Promising Future for Leo Dry Fruits and Spices

Leo Dry Fruits and Spices has made a strong debut on the BSE SME platform, with its shares listing at ₹68, offering investors an immediate listing gain of 30.77%.

Despite some volatility during the trading day, the stock closed at ₹71.40, delivering a strong 37.31% return for IPO investors.

The overwhelming subscription numbers further underscore the confidence investors have in the company’s growth potential.

With its solid financial track record, diverse product portfolio, and effective use of IPO proceeds to fuel further growth, Leo Dry Fruits and Spices is well-positioned for long-term success in the fast-evolving food and spices industry.

Investors will be closely watching the company’s progress as it continues to expand and enhance its market presence, with the hope of sustaining its impressive growth and delivering long-term value.