ADF Foods, founded in 1932, is a Mumbai-based company engaged in manufacturing, marketing and distributing ethnic Indian food products. Its products include pickles, chutneys, ready-to-eat items, paste and sauces, frozen foods and spices under various brand names such as Truly Indian, Ashoka, Aeroplane, Camel, etc. Its distribution network is spread across Europe, the United States, the Middle East, Australia, Canada, and Asia. The company also offers contract manufacturing services.
On the financial front, the company’s revenue rose 3.81 per cent to ₹166.73 crore in FY17 compared to the previous fiscal. The company’s PBDT declined 13.15 per cent to ₹26.15 crore in FY17 from ₹30.11 crore in FY16. The company’s net profit declined from ₹14.10 crore in FY16 to ₹12.37 crore in FY17, registering a decline of 12.26 per cent. On a quarterly basis, ADF Foods posted 3.79 per cent increase in its revenue to ₹41.87 crore in Q1FY18 from ₹40.34 crore in Q1FY17. The company’s PBDT increased 1.74 per cent to ₹7.56 crore in the first quarter of FY18 on a yearly basis. The company’s net profit rose 16.34 per cent to ₹4.27 crore for the corresponding period.
On the valuation front, the company is trading at a PE multiple of 38.71. Its return on capital employed stood at 7.63 per cent, whereas its return on equity stood at 6.48 per cent. The company is virtually debt-free. The company has been maintaining a healthy dividend payout of 33.47 per cent. We expect the stock price of ADF Foods to rise.