DFM Foods: Capacity addition boosts stock price

Delhi-headquartered snack food manufacturer, DFM Foods Limited reacted positively to the news of commissioning of its new production line in Noida.

DFM Foods has proposed to commission a new extrusion line at existing Greater Noida unit, Uttar Pradesh. The company's existing capacity is 39,400 MT per annum with a 79 per cent utilisation. The proposed capacity addition is 5,000 MT per annum. The new capacity addition will require an investment of Rs. 20 crore. Further, the company has taken an industrial premise on a long-term lease in Greater Noida (Uttar Pradesh) for future expansion.

The stock price was also backed by strong financial numbers for Q1FY20. Its revenue grew by 29 per cent for the quarter when compared to YoY. The net profits stood at Rs. 7.6 crore, up 52 per cent over last year. The higher prices of cornmeal were offset by lower refined oil prices which coupled with grammage rationalisation helped it to maintain margins similar to last fiscal.

DFM Foods is engaged in the business of production and sale of snack foods. It owns brands such as CRAX, CURLS, FRITTS and NATKHAT which sales corn rings and wheat puffs along with cheese balls and potato sticks.

The stock of DFM Foods touched an intraday high of Rs. 289 per share on BSE. At 12:20 pm, the stock traded higher by 15 per cent at Rs. 279 per share.