240 per cent returns in just 1 year: This small-cap multibagger stock receives incentives under PLI scheme!
The stock price has witnessed a remarkable increase from Rs 60 to Rs 204 within just one year, delivering multibagger returns of 240 percent to its shareholders.
The Government of India has been making concerted efforts to promote domestic manufacturing and create global champions in the industry. One of the key initiatives driving this push is the Production Linked Incentive (PLI) schemes. These schemes aim to boost exports, reduce cheap imports, and generate employment opportunities by subsidizing production. Foods & Inns Ltd, a Small-Cap company in the food processing industry, recently received the first tranche of incentives from the Ministry of Food Processing Industries under the PLI scheme for the financial year 2021-22.
Upon receipt of 1st tranche of incentives from the Government of India through Ministry of Food Processing Industries under the PLI scheme for FY21-22, the stock of Foods & Inns Ltd experienced a significant surge. It jumped nearly 9 percent, reaching a session closing level of around Rs 204, marking a fresh 52-week high of Rs 206.90 on the National Stock Exchange (NSE). The company's business operations revolve around processing and marketing various food products such as fruit pulps, concentrates, spray-dried fruit and vegetable powders, spices, frozen vegetables, snacks, and medicated products.
Under the PLI scheme for FY21-22, Foods & Inns Ltd received the first tranche of incentives totaling Rs 9.71 crores. The company successfully completed the committed capital expenditure and achieved the sales revenue targets for FY'22 and FY'23, as specified in its application and commitment under the scheme.
Expressing gratitude, the company stated in a press release, "We thank the Government of India for the release of incentives and perceive it as a strong vote of confidence in our vision, potential, execution, and commitment to excellence. The financial support received through these incentives will enable Foods & Inns to expand its operations, invest in cutting-edge technologies, and further strengthen its position as an industry leader."
In 2021, the Government of India approved the "Production Linked Incentive Scheme for Food Processing Industry (PLISFPI)," a central sector scheme with an outlay of Rs. 10,900 crore for implementation from 2021-22 to 2026-27. The Ministry of Food Processing Industries is responsible for the implementation of this scheme.
The stock price of Foods & Inns Ltd has witnessed a remarkable increase from Rs 60 to Rs 204 within just one year, delivering multibagger returns of 240 percent to its shareholders. The company serves a wide range of customers, including renowned beverage companies like Coca-Cola and PepsiCo, both in India and overseas. Approximately 45-50 percent of the company's revenue comes from exports, with Europe and the UK being the primary markets. Revenue growth has been supported by capacity expansion, leading to a rise from Rs 618.5 crore in fiscal year 2022 to around Rs 980 crore in fiscal year 2023. With robust demand for their products, ongoing capacity additions, and diversification in geographic reach and clientele, the company expects to sustain its revenue growth over the medium term.
The company's promoter, Mr. Dalal, brings more than four decades of experience in the food processing industry. His deep understanding of market dynamics and strong relationships with customers and suppliers continue to support the business. Furthermore, the day-to-day operations are managed by an experienced professional management team.