Share Bazaar journal June20

Vol.13 Issue 6 June 2020

Mukesh Ambani Anand G Mahindra Jignesh Mehta Hiren Ghelani
CEO & MD Director
CMD Chairman SecMark
Prime Fresh Ltd
Reliance Industries Ltd Mahindra Group Consultancy Ltd

Price - `125/-

Ready For Take Off!

Jinen Ghelani - Managing Director

Turnover to Double In 3 Years Steel and Cement Sector

Cospower Engineering Limited

Hospitality Sector Focus On Innovation & Technology

SecMark Consultancy Ltd

Indianbusinesstv Creator since 02-2013
2270 subscribers

Here’s how our channel did this month

+227 +17,907 +26,666

SUBSCRIBERS VIEWS MINUTES WATCHED

And here is how our community responded

+394 +57 +64 +267

LIKES COMMENTS POSTS SHARES

Vol.13 Issue 6 June 2020

Editor 02 04 04 07
J. P. Sethi
sbjmailindia@gmail.com Clifton Desilva Mukesh Ambani Anand G Mahindra Hiren Ghelani
Director CMD Chairman Director
Corporate Advisor
Vishnu Ajitsaria Fca Altina Securities Reliance Industries Ltd Mahindra Group Prime Fresh Ltd

Hyderabad Correspondent
Hanuman Prasad

info@sharebazaarjournal.com

Layout Designer
Jyoti Singh

Marketing & Advertising 09 21 22 25
9869047463
Jinen Ghelani Felix Kadam Oswald D’souza Jignesh Mehta
Business Development Manager MD Director Director CEO & MD
Kaivalya Joshi Cospower Cospower
Prime Fresh Ltd SecMark Consultancy Ltd
Engineering Ltd Engineering Ltd

Jitendra Pal Sethi on behalf of Grace Communications Printed at Print Vision. Edited and Published from Paradise Tower, Thane All readers are advised to consult expert
before taking any business and investment decisions and Share Bazaar Journal Today holds no responsibility for any losses that may arise due to business and
investment decisions made on the basis of information given within the magazine. All rights reserved. No reproduction is permitted in whole or part without written
consent from Share Bazaar Journal Today. All disputes are subject to exclusive jurisdiction of competent court and forums in Mumbai only.

Print Edition - `1500/- yearly For further enquiries and
Email Edition - `1000/- yearly Magazine Subscription,
Please Contact
12 Issues
Mobile : +91 9869047463

SBJ Gossip

“I'll give you advice, “My problem is,
but the market will I lost my first
determine if it was million before
good advice or bad I made my first
million.”
advice.”

Reliance Industries Ltd at `1600 is rumoured to be a good buy. Share has good chances of appreciation in the near future.
SBI Cards & Payment Services Ltd at `580 is rumoured to be a good buy. Share seems to have good potential for appreciation.

“Does my transfer “I was trying to
include my cubicle? predict future
market trends
I have all my and the computer
passwords written
blew up!”
on its walls.”

Www.indianbusinesstv.net 1 Www.indianbusinesstv.net

SBJ

Industry Update

Steel and Cement Sector

Capacity utilization at steel and Arcelor Mittal Nippon Steel India (AM/NS India) too is
operating at full capacity after a production cut in April and
cement companies has improved early May.

significantly in May after a sharp Public sector steel major, Steel Authority of India Ltd, is
operating at around 50 per cent production level. Anil
drop in April. A revival in Chaudhary, chairman, SAIL, said that domestic demand was
picking up. "With relaxations to lockdown, domestic demand
Clifton Desilva domestic demand to a limited will improve further." Up to July, our export order book is full,
Director extent, exports and easing of he added.
curbs, are driving major private
Altina Securities Pvt Ltd sector steel companies to ramp Steel industry representatives pointed out that 94 per cent of
the production was accounted for by six major companies in
up production, now hovering April which meant that secondary producers were either shut
or had not been able restart. However, since then many of the
between 70 per cent and near full capacity levels. Some secondary producers have resumed production.

cement companies too have increased capacity utilization to For cement companies, easing
of logistical hurdles and
about 60 per cent. Steel and cement were the biggest improved workers' availability
have helped move production
shockers - recording a more than 80 per cent drop - in the core levels in May and is expected to
go up further in June in the
sector output in April. However, with lockdowns being eased, wake of more relaxations to
lockdown.
domestic demand is expected to improve further.
While cement production
Tata Steel managing director halted in March-April owing to
and chief executive officer, the lockdown and the steps
T V Narendran, said, the taken to control Covid-19,
company was currently production commenced in May
operating at 70 per cent in some of the plants after
production level and about receiving approvals from the
50 per cent was focused on respective state governments.
exports.
“A rebound is expected as production had commenced owing
"In the domestic segment, to the demand conditions and at some plants, the capacity
demand is currently led by utilization is as high as 60 per cent now”, H M Bangur,
rural markets, oil and gas, managing director at Shree Cement said.
LPG and B2C segments like
roofing and sheeting" he
added.

JSW Steel has ramped up
production to about 85 per
cent. Seshagiri Rao, joint managing director and group CFO,
JSW Steel, said that domestic steel demand for the industry in
April was down by 90 per cent, so majority of sales was
exports. In the month of May, we are seeing a demand
recovery from 10 per cent in April to 25-30 per cent, Rao said.

Jindal Steel & Power (JSPL) managing director V R Sharma was According to industry officials, individual house builders (IHB)
expecting domestic demand to pick up further in June. In May, segment, which drives 55 per cent of the annual demand, has
the company exported 65 per cent of its output but Sharma been reviving after construction activities were permitted by
expects the share to come down to 50 per cent in June. JSPL is various state governments.
operating at full capacity.
“From March-April, we have understood that the pandemic is
"The MSMEs in the engineering segment have started typically an urban phenomenon and the effect has been felt in
operating. Domestic demand will improve further in June," he the urban sector mostly. However, in rural areas, the demand
said. is still driven by individual households and some government
sponsored construction activities,” an industry official said.

Www.indianbusinesstv.net 2 Www.indianbusinesstv.net

SBJ

Industry Update

The primary reason being that laborers employed in rural IHB “It is likely that these construction activities will drive
construction are mainly locals while in urban centers, it is demand as well”, the sector official said.
migrant workers who are speeding back home.
POINTERS:
Moreover, government projects like road and irrigation
projects which employ local laborers under the MNREGA Private sector primary steel producers operating at 70 per
scheme has also started driving demand. cent to full capacity levels.

A second sector official cited that in total 1,885 tenders, Some cement plants operating at 60 per cent production.
aggregating `46,500 crore were floated in March 2020 of
which, water and irrigation, building and housing and road More relaxations to lockdown is likely to help boost domestic
projects account for 72 per cent of the total tenders. demand further.

Hospitality Sector

The government stated that restaurants, hotels, and other benefits of which will be seen only be seen post Fy21.
hospitality services would be allowed to function from June
8, along with shopping malls and complexes, as part of 'Unlock On back of marginally positive sentiments for the domestic
1.0' strategy to resume economic activity. tourism and meetings, incentives, conferences and
exhibitions (MICE) led by social and industrial activities, CARE
Indian Hotels, Chalet Hotels, EIH, Taj GVK Hotels & Resorts, Ratings expect the momentum to pick up going forward and
EIH Associated Hotels and Shopper Stop are some of the the industry to register a growth of about 3-5% in revenues for
beneficiaries. The Centre has outlined a plan to reopen FY20-FY21.
nearly all activities outside of containment zones starting
Monday. Places of worship, hotels, restaurants and malls can “The expected future inventory in 11 major markets (across
resume business by June 8, it has said. Coinciding with this, categories - only branded) is lower at around 50,170 rooms for
lockdown would continue in containment zones till June 30. the next 5 years (FY19 to FY24). Therefore, with increasing
demand on back of improvement in economic activities and
Most of the hotels stocks have underperformed the market lower room additions, it is expected that the major markets
during lockdown period. Despite run-up in the past couple of in the industry will sustain the average room rates (ARRs)
days, these stocks have fallen in the range of 40 per cent to 50 going forward and grow at an average of 3.5-4.5 per cent per
per cent over the past three months, as against a 13 per cent annum. Also it is expected that occupancies will inch up to an
decline in the benchmark Sensex. average of about 68-70 per cent by the end of FY22 compared
with 66.7% in FY19.
While certain demand is expected to be impacted on account
of the ongoing Covid-19 concerns, India is also expected to Accordingly, the hotels industry is expected to see an increase
benefit from it as demand from MICE and other Asian in room revenue at the rate of about 6-8 per cent CAGR over
countries is expected to be diverted to India to some extent, the next 3 years.

Www.indianbusinesstv.net 3 Www.indianbusinesstv.net

SBJ

Company Update

Reliance Industries

On Saturday Reliance Industries digital unit got investments `11,367 crore
from global investment firm TPG and PE firm L. Catterton.
With these investments the mega telco has so far raised 5. On June 6 Mubadala investment company, the Abu
`1.04 lakh crore and sold 22.38% stake Dhabi based sovereign investor agreed to invest `9093.60
crore for a 1.85% stake
1. On 22nd April Social media giant Facebook announced an
investment of `43,574 crore into Jio Platform translating 6. On 5th June private equity fund silver Lake invested
into a 9.99% equity stake, the largest FDI in the Indian tech another `4546.80 crore for an additional 0.93% stake
sector.
7. Abu Dhabi Investment Authority (AIDA) took a 1.16% stake
2. On May 8, US based private equity firm Vista Equity for `5683.5 crore
Partners bought a 2.32% stake for `11,367 crore
8. On 13th June Reliance Industries sold a 0.93% stake to
3. On 17th May General Atlantic, the US investment firm that global alternative asset firm TPG for `4546.80 crore
helped fund Airbnb Inc. and Uber Technologies Inc. picked
up 1.34% stake for `6598.38 crore 9. On 13th June L. Catterton one of the world's largest
consumer focused equity firm would invest `894 .50 crores
4. US – based private equity giant KKR took a 2.32% stake for translating into a 0.39% stake.

Mahindra & Mahindra

Hit by impairment losses mainly in its South Korean At `9,144 crore, its net sales in the quarter on a standalone
subsidiary SsangYong and other international subsidiaries, basis were the lowest since the December quarter in 2013.
and a sharp fall in demand for its tractors and utility In comparison, it reported net sales of `14,035 crore during
vehicles because of the Covid-19 pandemic, Mahindra & Q4FY19 and `12,345 crore in Q3FY20. Losses were largely
Mahindra reported its first quarterly loss in nearly two attributed to asset impairment charges as M&M marked
decades during the quarter ended March 31, 2020 down the fair value of its long-term equity investment in its
(Q4FY20). subsidiaries and joint ventures because of Covid-19.

The company reported a pre-tax loss of `1,761 crore on a This led to an exceptional loss of `2,780.5 crore on
consolidated basis in Q4FY20, the first such instance since standalone basis and `1,782.6 crore on consolidated basis
the July-September quarter in 2001. during the quarter. Adjusted for exceptional gains and
losses, it reported net loss of `530 crore on consolidated
In comparison, the Mumbai-based company had reported a basis and a net loss of `276 crore on standalone basis.
profit before tax (PBT) of `1,705 crore on a consolidated
basis in Q4FY19 and `868 crore in Q3FY20. The firm began The Street, however, expected worse and equity investors
reporting consolidated quarterly result only from the June and traders were delighted at the lower losses in the
2018 quarter. company’s core businesses of tractors and domestic
automobiles. As a result, the stock rallied after the results
M&M also reported a sharp decline in net sales during the and M&M was the top gainer among index stocks, ending
quarter as volumes declined across segments because of the day with gains of 7.2 per cent, against 0.7 per cent rise
the lockdown. On a consolidated basis, net sales were in the benchmark BSE Sensex.
down 26 per cent year-on-year (YoY) to `20,182 crore
during the quarter. Standalone net sales fell 35 per cent YoY The company reported a 100 basis points increase in its
in the quarter - its worst showing since it first reported share of the domestic tractor market to 41.2 per cent
quarterly results in June 1997. during FY20, against 40.2 per cent the previous year.

Www.indianbusinesstv.net 4 Www.indianbusinesstv.net

SBJ

Company Update

SBI Cards and Payment Services Ltd

SBI Cards and Payment Services Ltd. (SBI Card) a subsidiary of Profit before tax (PBT) fell 70.9% to `112.08 crore in Q4 FY20
SBI is one of the leading credit card issuers in India, which is one over Q4 FY19. Total income rose 20.9% to `2,510.39 crore in Q4
of the fastest-growing economies in the world with an FY20 as against `2,076.25 crore in Q4 FY19. Total expenditure in
expanding and under-penetrated credit card market. As per the Q4 FY20 rose 41.79% on a year-on-year (YoY) basis to `2,398.31
survey, India has just 3% penetration (lowest in the world) in the crore, mainly on account of surge in impairment losses & bad
credit card segment leaving ample scope for advancement. debts which stood at `838.18 crore (up 138.3% YoY).

SBI Card is the second-largest credit card issuer in India, with a SBI Card's net profit jumped 43.9% to `1244.82 crore on a 33.8%
17.6% and 18.1% market share of the Indian credit card market rise in total income to `9752.29 crore in the year ended March
in terms of the number of credit cards outstanding as of March 2020 (FY20) over the year ended March 2019 (FY19). PBT stood
31, 2019, and November 30, 2019, respectively, and a 17.1% and at `1,729.63 crore in FY20, up by 29.6% from `1,335.08 crore in
17.9% market share of the Indian credit card market in terms of FY19. Interest income increased 35.4% to `4,841.30 crore in
total credit card spends in fiscal 2019 and in the eight months FY20 over FY19, primarily due to a 28.9% increase in the average
ended November 30, 2019, respectively, according to the RBI. It amounts of credit card receivables in FY20 as compared to
offers an extensive credit card portfolio to individual FY19.Income from fees and services increased 29.5% from
cardholders and corporate clients which include lifestyle, `3,072.04 crore for FY19 to `3,978.66 crore for FY20. Late fee
rewards, travel and fuel, shopping, banking partnership cards has a reversal of `90 crore during FY20 due to impact of COVID.
and corporate cards covering all major cardholder segments in impairment losses & bad debts expenses for the year increased
terms of income profiles and lifestyles. by 69% to `1,940.25 crore in FY20 from `1,147.74 crore in FY19.
Considering the possible effects from the pandemic relating to
It started operations in 1998, and since then SBI's parentage and COVID-19, company has performed sensitivity analysis and
highly trusted brand have allowed it to quickly establish a based on current estimates has created specific COVID-19
reputation of trust, reliability and transparency with related provision of `489 crore, CIF (cards-in-force) grew by
cardholders. According to the RBI, SBI Card has grown its 28% to 1.05 crore and spends grew by 27% to `130,915 crore in
business faster than the Indian credit card market over the past FY20 over FY19. The company's market share stood at 18.2% in
three years both in terms of numbers of credit cards FY20, higher than 17.6% in FY19.Total credit card receivables as
outstanding and amounts of credit card spends. From March 31, of 31 March 2020 were `24,140.61 crore, an increase of 30.3%
2017, to March 31, 2019, its total credit card spends grew at a from `18,526.29 crore as of 31 March 2019.The gross non-
54.2% CAGR (as compared to a 35.6% CAGR for the overall credit performing assets were at 2.01% of gross advances as on 31
card industry, according to the RBI) and the number of its credit March 2020 as against 2.44% as on 31 March 2019. The provision
cards outstanding grew at a 34.5% CAGR (as compared to a coverage ratio increased to 67.20% in 31 March 2020 from
25.6% CAGR for the overall credit card industry, according to 66.48% in 31 March 2019.The company has partnerships with
the RBI). leading brands across industries. SBI Cards has partnered with
Air India, Apollo Hospitals, BPCL, Etihad Guest, Fbb, IRCTC, OLA
It has a presence in 3190 open market points of sale across India Money and Yatra, amongst others The issue opened on March 2
as of December 31, 2019. Also, its partnership with SBI provides 2020 at a price band of `750- 755 per share and the issue size
with access to SBI's extensive network of 21961 branches across was 137,193,464 shares for a total or `10,354.77 crore
India, which enables it to market credit cards to SBI's vast comprising of a fresh issue of 6,6225117 shares of `10 each for a
customer base of 445.5 million customers as of December 31, total of `10,354.77 crore and an offer for sale of 1,30,526.798
2019. shares of `10 each for a total of `500 crore. The issue was
oversubscribed 26 times. SBI Card enjoys fancy due to parent
SBI Cards is 74% owned by SBI and the remaining 26% is owned by SBI's credentials. Being a second-largest plastic money player in
Carlyle Group, which it bought it from GE in 2017. Through this a growing economy like India and the first mover in the segment
IPO, SBI divested 4% of its stake, while Carlyle sold 10% of its to get listed, it would continue to generate interest. Post issue,
stake Together SBI and Carlyle Group offloaded 3.73 crore SBI Card's current paid-up equity capital of `932.33 cr. will
shares and 9.32 crore shares respectively. The company’s total stand enhanced to `938.95 cr. The IPO was priced at `750 and
income has grown at a CAGR of 44.9% and the revenues from due to adverse market conditions the price sank to a low was of
operations have risen at a CAGR of 44.6% between fiscal 2017 & `495 against a high of `769 and currently quotes around `530
2019. The company has posted the net profit growth at a CAGR levels at which price the stock appears attractive for medium to
of 52.1% during the period, SBI Card reported 66.4% decline in long term gains. it is quite likely that once the market stabilizes
net profit to `83.54 crore in Q4 March 2020 (Q4 FY20) compared the stock could surpass the IPO price of `750 which in turn
with net profit of `248.73 crore in Q4 March 2019 (Q4 FY19). would result in a gain of over 40%.

Www.indianbusinesstv.net 5 Www.indianbusinesstv.net

SBJ

Cover Story

Ready For Take Off!

Ever evolving, constantly transforming and ready for
tomorrow's hyper growth in F&V Industry.

Prime Fresh Limited (Formerly Prime Customer Services Ltd.)

Prime Fresh Limited is an integrated institution (company) across Fruits & Vegetables supply Value Chain –
precisely from farm to market / fork. Over the last 13 years, Prime Fresh has built a wide network of over
25,000 Farmers, 52+ Agriculture Markets & 600+ Trade Partners. Abiding by the government compliances,
Company is ISO certified & rated by CRISIL and SMERA (D-U-N-S number 86-003-2121). Prime Fresh holds
several licenses like FSSAI, SMETA, AGMARK, APEDA and APMC Ahmedabad.

The Management has collective experience of more pioneered in Ahmedabad for Fruits and vegetables
than 15 decades through a strong core team of 8 supply chain solutions, Prime Fresh Limited today has
members. There are tremendous growth opportunities emerged & evolved as fully integrated end to end Fruits
for Prime Fresh Limited as the F&V sector is getting and vegetables post-harvest management company over
organized, importance of hygiene practices are the last 13 years.
becoming vital along with rising demand for quality,
packing & services. Company is poised to capitalise the The Company today works across 9 states for
learning curve, building blocks and further second layer distribution and procurement of F&V round the year,
management team of 12 members with experience of having Omni channel strategy of Fruits and vegetables
100 plus collective years built over the recent past. Distribution.
Company's ambition is to be the largest supplier of fresh
Fruits and Vegetables in India. The procurement department deals with more than
25000 farmers, 300 aggregators, 200 plus logistics
Established in 2007, started as B to C company, service providers & huge number of 3PL facility

Www.indianbusinesstv.net 6 Www.indianbusinesstv.net

SBJ

Cover Story

managers and various transporters, packers, graders “We started (April -2007) with our design van and used
and other supply chain partners. Prime Fresh Limited to go to different residential societies in Ahmedabad and
has built a massive goodwill, track record, know-how get approvals for supply. But within 6 to 8 months we
and brand across all its stakeholders. realized that home delivery was too early at that point
in time. We realized that we need to change the business
Since 2007, Prime Fresh Limited (Formerly, Prime model to act as a supplier & service provider to modern
Customer Services limited) has managed to transform trade and other corporates,” recalled Mr. Hiren Ghelani,
itself into one of the major players in the Indian Fruits & Director - Prime Fresh Limited
Vegetables supply chain Industry.

************************************************************************************************

To get more insight, let's read through the excerpts of the Interview of
Mr. Hiren Ghelani, Director - Prime Fresh Limited

are also ensuring various approvals, prior intimations,
improvement in preplanning and servicing our clients.

The Key challenges are:

Ÿ To address the fear of all players in entire value chain

Hiren Ghelani - Director Ÿ To ensure timely and smooth functioning of complete
value chain from sourcing to distribution with proper
meticulous minor planning in the perishable
segment.

“Some of these points are the opportunity, need for The Future challenges are:
change in the processes of F&V Dynamics: The Current
Covid-19 situation is throwing multiple challenges, Ÿ Managing cash flows for better profit margins impacts
opportunities, lessons for massive improvement as the F&V sector has very low Margins.
required in entire Fruits & Vegetables supply chain
sectors. The importance of hygiene, cleanliness, Ÿ The convincing and educating part to consumers and
packing and servicing approach is being understood, some critical players about cost, viability, Medium
valued and accepted. term revamping and repositioning plans, improving
practices and procedures for serving the sector.
There are constant new challenges emerging daily from
regulatory approvals to training the team a fresh and
revamping entire supply chain model to readjust to new
realities.

Team Prime Fresh feels that permanent changes are
required for the various stakeholders, business partners
to be able to survive and remain relevant & viable.

We are trying to continue to be extremely vigilant, Prime Fresh - Pomegranete Farmers registration drive
communicative, and helpful to our partners and key
stakeholders like, Farmers, labours, graders, packers,
transportation providers and last mile delivery staff. We

Www.indianbusinesstv.net 7 Www.indianbusinesstv.net

SBJ

Cover Story

Our Agendas & Top Priorities: common resources and build a model around better
planned sourcing and supply.
1) Spend more time and resources in education, 3) Invest in digital marketing, adopt more hygiene
training, new processes, building more viable model practices like Grading instruments, equipment and
and adding more integrated infrastructure. vehicle etc.

2) Tie-up with more organized players, collaborate for

COVID -19: Important learnings from recent Challenges & Problems in F&V sector:

Massive changes and opportunities lie ahead in Indian Prime Fresh B2C F&V packaging - Home Delivery
Fruits and vegetables sector!! Organized players &
Corporations will play a vital role in bringing about a big Going forward, following are the focused areas for
change going forward. India needs to invest lots on hyper & consistent growth in F&V Industry shared by
Collections centres, Distribution centres, Pack houses, Team Prime Fresh Limited:
other channels and cold storage & Warehouses near to
production and consumption points. Over the longer Ÿ Maintaining high Hygiene standards
term, the current model of APMC driven F&V supply Ÿ Maintaining Nutritional value
chain is not sustainable to serve the country. Ÿ Maintaining Quality - Consistency
Ÿ Maintaining Service standards
Country needs much more stronger decentralization of Ÿ Maintaining Regular Availability
markets, operations, Arrival and dispatch through Ÿ Standard Process following in Handling & packaging
various models. Early mover, Prime fresh enlightens Ÿ Door Step / last mile Delivery
based on its 13+ years of industry experience on a model
as below: Indeed, Consistency & Continuity of all the aforesaid are
rare and very limited in F&V and Hardly few players are
1. Hub and spoke model. able to manage & maintain it. Prime Fresh believes and
follows these always as the fundamental drivers and
2. Setting up Collection centres and link them to hubs pillars for the F&V Business.
and DC (Distribution centres).

3. CC (Collection Centre) with better packaging facility
can directly serve the modern trade, Direct to Home
and hubs.

Business Segment - Prime Fresh Limited

Service Fruits & Exports
Business Vegetables
Supply Chain
Prime Mango B2C operarions - Corporate tie Up
8 Www.indianbusinesstv.net
Www.indianbusinesstv.net

SBJ

Cover Story

provide massive employment to unskilled, semi-skilled
and other several people through this model. Company
also pays huge GST and other taxes by way of these
activities.” says, Mr. Hiren Ghelani. “The model in this
business is typically cost plus plus model, productivity
and project based contracts which are renewed every
year” added Mr. Ghelani.

Jinen Ghelani - Managing Director Fruits & Vegetables Supply Chain

Service Business The other business vertical - also the core & major
growth oriented business of the company, is the fruit
Currently the company's business is clearly bifurcated vegetable supply chain business. It essentially comprises
into two divisions. One of them is service business which of sourcing and distribution of fresh fruits and
is related to sorting, grading, packaging, warehousing, vegetables. “We source from farmers, local area
clearing forwarding, facility management, etc. “Our aggregators and mandis (Local / state level APMCs). We
core clients in this segment includes WaghBakhri Tea also enter into agreement with large & select small
(Gujarat Tea Processors), Agility Logistics, Reliance group farmers for some form of lease farming and joint
Fresh etc. We currently handle about 70 to 100 tonnes ventures – but it is a small portion of the total business.
of fruits and vegetables and dairy & bakery products per On the supply side, we supply to different Mandis
day for the last 11 years for India's largest retailer. We (National large APMCs), to modern trade, to food
processing companies, exporters, global buyers,
HORECA and B TO C clients” explained Mr. Ghelani.

Supply Chain Management of F&V Business

Exports

Leased Farmer Retailers/Modern Trade

Contract Farmer Processors
Whole sellers Whole sellers (APMC)

Direct Farmer/Agents Cart Vendors

Other Buyers*

Hub & value chain model (HVCM)

Value addition at various levels – sourcing, sorting, grading, packaging and branding

Entry Into Exports consignments in selected products like Onion, Mangoes,
Grapes and few vegetables.
Prime Fresh Limited steadily started building Exports
verticals over the last 4 years by executing smaller “Starting this year (CY-2020), we have also started our

Www.indianbusinesstv.net 9 Www.indianbusinesstv.net

SBJ

Cover Story

own focused exports – we will be exporting Grapes, vegetables business along with heading few other
mixed vegetables, pomegranates and mangoes with the product categories. A Couple of independent directors
help of a dedicated team,” Mr. Ghelani informed. too have experience of 25 to 30 years in food processing
and agri-input companies. Hence, they bring in a huge
The company currently operates in about 40 districts in experience and huge networks in various niches of our
Maharashtra, Gujarat, Rajasthan and a couple of business,” explained Mr. Ghelani.
districts in North India for continuously strengthening
its procurement bandwidth of 1 lac TPA. The products Another key factor that is very important for Prime Fresh
that Prime Fresh deals in primarily include is to maintain consistency of meeting customer's
Pomegranates, Mangoes, Onions and Tomatoes. “We are requirements in the fresh fruits and vegetables
also building two new categories – Grapes and segment. While this might seem a cliché, it is actually a
Oranges,” Mr. Ghelani gladly shared. very important and dynamic exercise for the company
involving strong implementation of sound SOP across all
Good Growth departments.

The company has been growing progressively over the “For example, a client in Mumbai who wants to export
last five years at 22 per cent CAGR and 33 per cent Mango from Mumbai airport has a specific requirement
EBITDA CAGR. It now boasts of a total of about 600 B2B about materials, at what maturity level the fruit should
clients and 40,000 customers in B2C in Ahmadabad and be harvested, how it should be graded & packed, what
Mumbai. There are more than 25,000 farmers in the 40 kind of treatment needs to be done, etc. Besides, while
districts that the company operates in from whom dealing with modern trade client such as Reliance, Big
PRIME FRESH sources products. Bazar, Hyper City, Big Basket, etc. , their requirement
for quality, packaging, the ripening stage of the fruits
“Our aim is to provide hygienic, high quality well are very different from the exporting client,” clarified
packed fruits and vegetables,” said Mr. Ghelani. by Mr. Ghelani.

Experience Is The Key Meeting Buyers Choices

One of the major factors that contributed to the success Further, packaging and quality also differs based on
of the company is the immense experience present with preferred consumption patterns prevailing there
its core team & Middle management team bandwidth. according to where one is exporting fruits or vegetables
or in which particular domestic market the materials
have to be dispatched.

The company also makes sure that it meets strict
international standards by associating with various third
party logistics service providers and various third party

Team Prime Fresh - All smiles, core strength Prime Fresh's consumer connect initiatives

“Our core team has more than Twelve (12) decades of
experience. The company's Chairman has about 23
years of experience in FMCG, sales & distribution. Just
before starting this company, he was the head of
Gujarat operations of Subhiksha Retail's fruits and

Www.indianbusinesstv.net 10 Www.indianbusinesstv.net

SBJ

Cover Story

warehouses and cold storages. “We ensure that the possibility offers a huge opportunity for at least 30 to 40
right processes for sorting, grading, handling, cleaning, companies like us to grow as well. So it is possible that in
packing and stuffing of the products are followed,” the next 7-8 years there will be many fruit and vegetable
narrated by Mr. Ghelani. The idea is to ensure that companies in India with a size of between `1000 to
shelf-life of the product is expanded, wastages are 5,000 crores,” said Mr. Ghelani talking about the future
reduced and clients' satisfaction is accomplished. scope of the company.

All India Expansion The company is confident that it will be able to expand
its business much more by setting up of more pack
The company now has been expanding into many states houses so that it can tie up with global retailers and
and regions of India. wholesalers and have a good order book.

“Over the last two and half years, we have started to “We have identified centres in Kutch, Nashik and one or
venture into the North and North East of India and tying two centres near Baramati in Maharashtra. It will help us
up with established players in the regions. We are also to get large and long term orders and this backward
tying up with modern trade companies in Delhi and integration and capacities in infrastructure can support
other areas. A lot of products already flow to the North in that. We also hope to get advances from clients over
East from Gujarat, Rajasthan, Maharashtra and other next 2-3 years with this infrastructure set up,” added
such areas. This trade depends crucially on how Mr. Ghelani.
efficiently logistics are handled and the level of
efficiency of taking the materials or making the Boost To Exports
products reach where they are not available. We are
trying to create a scale by expanding both at the back The company also plans to increase its own exports.
end and at the front end,” highlighted Mr. Ghelani.
Company is also trying to add new product categories, Prime fresh grapes loaded container for Europe - CY2020
geographies for procurement & distribution, adding
more senior & experienced team members, investing in Since the last 3 to 5 years we have also been doing our
marketing, ecommerce and brand development. Prime own exports to the Middle East, UK and Netherlands. We
Fresh strongly believes that the team, technology, have built a clear understanding of how the trade
digital marketing, better & better hygiene practices for happens there, the quality standards and packing
entire value chain from harvesting to distribution will standards applicable there. We have identified about
play a vital role for the company during the next 100 clients in these countries and are actively in touch
decade. Company aspires to reach from current with them. We expect that our own exports that was
12000TPA of F & V distribution to 70000 TPA over the hardly any last year, should be between `6-7 crores in
next 4-5 years. FY20-21. We aim to build `60 crore export vertical in the
next four years,” said the confident Mr. Ghelani.
Huge Opportunities
Scalability
Mr. Ghelani sees huge opportunities for the company as
more of the Indian horticulture industry is getting Company is strengthening procurement and adding new
organized. raw material supply sources.

“Horticulture production in India is about 30 crore
tonnes and is worth more than `8-9 lakh crores for the
entire country. Out of that only about 10 -12 per cent is
organized – including modern trade, food processing
companies, exporters and a couple of players like us. So
there is a huge scope for this industry to get organized.
We believe & foresee that at least 40 per cent of the
business will get organized in the next 8-10 years. The

Www.indianbusinesstv.net 11 Www.indianbusinesstv.net

SBJ

Cover Story

Sources FY17 FY18 FY19 FY20 FY21 P Fy22 P
Farmer Connects 8,000 15,000 25,000 33,000 50,000 100,000
APMCs covered*
Consolidators mapped 22 38 39 52 58 65
Collection Centres 85 180 450 480 500 520
B2B clients 2 12 20
B2C reach 450 7 8 8 800 1500
25000 548 600 660 100000 250000
28000 35000 40000

Our interactions with various experts and their
feedback received:

š Mr. Naidu the Ex banker of Prime Fresh, at Central
Bank of India; shares his experience and opinion
about Prime Fresh LTD as below,

Mango Farmers meeting with Maharashtra Mango Growers Association “In Ahmedabad Ashram Road branch they were one of
our prime customers. They were having good
In fruits and vegetables segment company is dealing in satisfactory transactions record. In my opinion this is an
Mangoes, Pomegranate, Apple, Tomatoes, Onion, excellent company. Entrepreneurs are enthusiastic,
Imported Fruits and Mix Vegetables and will be adding aggressive and having Goodwill in the market.”
Banana, Orange, Grapes and few other vegetables,
thus engaging with new clients both in the domestic š Jayesh Jagirdar is an Agri consultant, progressive
and international markets. farmer, veteran R&D expert in organic farming
having more than 30 years of experience in
Southern Gujarat & Maharashtra for various
vegetables and fruits crops. He has got huge
network of more than 10000 Farmers in these
two States.

Future “Prime's future is very bright. I have been associated
with this company since 2016. Prime management has
Ÿ Prime intends to expand the supply chain operations created excellent Goodwill among farmers. They have
across India, to help augment growth in sales with its never failed in their commitment. They directly source
customers. This involves improving procurement from the farmers and do retailing and there is no
capabilities (ex. through contract farming), intermediary. Company's team is full of quality people. I
optimizing supply chain activities and expanding suggested them organic farming and to market it with
distribution. their brand. Now they are starting this and the future of
the concept is extraordinary. I feel proud to be
Ÿ Company is aspiring to set up Integrated Pack associated with this company. Company's commitment
Houses, Collection Centres and Distribution Centres and management is extraordinary. I have worked with
at strategic locations. many MNCs but Prime's working style is superb.
Government is also focusing on organic farming and
Ÿ Prime is aspiring to raise INR 300 million (USD 4.2 Prime has got good response from the market. No one is
million) With this investment, revenue has a leaving Prime and more and more people are looking to
potential to grow at ~60% CAGR to ~INR 288 crores in associate with this company. Company will naturally
the next 3 years and aiming to reach EBITDA margin grow as its financial strength is increasing days day by
at ~8%. day.”

Www.indianbusinesstv.net 12 Www.indianbusinesstv.net

SBJ

Cover Story

š Isha Amera - Business analyst, financial relationship with the farmer is not easy. They have long
consultant and Investment banker. During our term relationship with the farmers. Prime is well
conversation she narrated in her own words the diversified geographically with strong foothold.”
following:
š Vinod Desai – CA, Agri consultant and Farmer
“Jinen has the knowledge of the sector and the groups' advisor
company is his brain child. Hiren's exposure is into
equity Research and marketing and he has brought “I know them for last 10 years. They are good persons,
funding to the company. So the Synergy of both brothers hardworking and good in character. If Prime comes to
is channelized and they have been instrumental behind South Gujarat then it is win win situation for Farmers as
the growth of the company. This is one of the few well as for Prime. Now we are focusing on organic
organised companies in this sector and is involved in farming and Prime can get products sourced from here.”
every part of supply chain. Company has grown
organically in its business. Prime has done trial and š S N Shah – Ex Auditor of Prime Fresh Limited.
testing before moving into Exports. In the next five
years company will be listed on the main board. “The company has built strong ground level direct
Enthusiasm and vision of both brothers is unique.” sourcing capabilities. Company follows good marketing
practices and both brothers are hardworking & having
š Mr. Chetan Thakor, a social entrepreneur, good integrity. They have spent good long time and
actively involved with several government grown the company from scratch levels. The business
programmes and with Few NGOs in South Gujarat, model is unique and decent.”
Mr. Thakor who is very old veteran in horticulture
and related Agri activities( Associated with more š Chetan Vora – Debt syndicator, financial advisor
than 15000 Farmers) for more than 25 years in and veteran in capital market.
Dharmpur and other South Gujarat areas opined
that, “Promoters are hard worker, good at character and
dynamic”
“Prime Fresh has been very consistent, honest and
committed in its business practices in these area where Investments Rational:
he has been monitoring and reviewing for last 4 years.”
Prime Fresh's payments policies are very sound and their Prime Fresh Limited has built a very unique &
efforts for farmer's education and buying all grades of differentiated business model with Very high potential
materials are really consistent.” for superior growth over coming decade. The entry
barriers like F&V trade learning time required,
Mr. Thakor believes that, PRIME FRESH has massive networking time invested with massive Number of
support by Farmers, local eco systems, various NGOs
and other agencies for setting up and expanding their
South Gujarat operations to reach annual procurement
of 10000 + tonnes of Fruits and vegetables.

š Sherwin Fernandes from Karvy, part of the IR
team.

“Both brothers are the eyes and brains of the business. Prime - warehouse Management
It is the experience that is making business forward.
Manpower is the main cost, second cost is logistics and
third cost is warehousing. Primers Prime has pan India
presence. They do sourcing grading, sorting and
packaging as per client's requirement. They take all the
pain to make this business moving. Building this

Www.indianbusinesstv.net 13 Www.indianbusinesstv.net

SBJ

Cover Story

stakeholders, product & seasonal challenges related new product categories, addition of new clients across
knowledge and ability to manage several seasonal different sales channels and building of robust broad
volatilities are not easy to acquire or build in a short based business positioning for sustainable growth going
span. These are the major USP of the company and forward due to sustained expansion in sourcing and
hence, the sustainable value has been created in distribution network.
business over the years by PRIME FRESH TEAM.
Huge additions of farmers network, Aggregators
The detailed financial model, expected tonnage to be network, team building, infrastructure and
procured and sold, potential break-up of sales segments transportation collaboration and enrolment of Massive
wise, potential synergy gains, expected improvement in clients.
GP &, OP with massive control on Fixed operations and
corporate overheads. Rising volumes of F&V handling and increase in own
procurement bandwidth to the tune of 1 lac TPA of F&V
Company can be valued at 30-35 PE based on track products across 4 States having completely &
record, growth outlook, sustainable expansion in successfully de-risked the supply side bandwidth for
organized F&V sector and future visibility for multi-year expanding tonnage sales of F&Vs.
growth certainty.

The similar parameters, available sector notes and
company internal aspirations plus current capacity of
procurement and distribution provide the insight that,
During FY22, Company could report a sales and PAT
respectively of 130 cr and 5.2 cr. This provides an EPS
target of `14.8 , assuming a 10-15% dilution of equity,
the conservative EPS target could be `12.5

Key Financial highlights

Ÿ Consistent growth and improvements in sales, Quality Inspection by Prime Fresh
margins and profitability ratios over the last 3
financial years FY17 to Fy2020. Entry into exports business…

Ÿ Very Low debt as % of Net-worth 0.35 Debt equity Prime Fresh Limited has built a very unique &
ratios. differentiated business model with Very high potential
for superior growth over coming decade.
Ÿ Continuous improvement in GP, EBIDTA, EBIT AND PAT
margins.

Ÿ Rising ROE and respectable operating and financial
efficiency.

Ÿ Promoters' sustained commitment by putting more
equity through pref. warrants issue & creeping
acquisition from open market.

Ÿ Sales have doubled in last 3 years and profits have
multiplied almost 6 times in same period between
FY2017-FY2020.

Ÿ No pledge of shares by promoters or any other
shareholders seen. No personal leveraging by
promoters in any other forms.

Key Operations highlights The entry barriers like F&V trade learning time
Continued expansion of business in new geographies, required, networking with massive Number of
stakeholders, product & season knowledge and ability to

Www.indianbusinesstv.net 14 Www.indianbusinesstv.net

SBJ

Cover Story

manage several seasonal challenges are not easy to Reasons for Margins expansion:
acquire or build in a short span. These are the major
USP's of the company and hence the sustainable value Prime Fresh Limited has been investing and spending
has been created in business over the years by PRIME heavily in people, process, procurement, Farmers
FRESH TAEAM. network and clients base expansion over the last 3
years.
Company's Valuation
The growth requires more working capital V/S on other
The detailed financial model, expected tonnage to be expenses etc leading to expansion in GP and Operating
procured and sold, potential break-up of sales profits as incremental sales to other operations related
segments wise, potential synergy gains, expected direct and indirect overheads to remain under control.
improvement in GP &, OP with massive control on Fixed
operations and corporate overheads, Prime Fresh The detailed financial model, expected tonnage to be
limited conservatively, is expected to report a sales of procured and sold, potential break-up of sales segments
`75-80 cr with NPM of 3.5% implying an EPS of `8. wise, potential synergy gains, expected improvement in
Company can be valued at 30-35 PE based on track GP &, OP with massive control on Fixed operations and
record, growth outlook, sustainable expansion in corporate overheads, Prime Fresh limited likely to see
organized F&V sector and future visibility for multi- expansion in profitability margins across the board.
year growth certainty.
Higher growth will ensure strong gains coming from
During FY22, Company could report a sales and PAT operating and financial leverage.
respectively of 130 cr and 5.2 cr. This provides an EPS
target of `14.8 , assuming a 10-15% dilution of equity, Scope for many entrepreneurs in F&V industry due to
the conservative EPS target could be `12.5 no/ minimal Competition:

Company may continue to get a 35 PE, implying a stock Today, the Indian F & V sector claimed to be worth more
price target of `437 plus over the next 3 years. than 8 lacs cr in size. The industry is highly unorganized,
fragmented and extremely unregulated. The market
Base for Valuations: share for organized players is expected to reach to 40%
over the coming decade from 10-12% currently.
Generally, High growth Food and Distribution
businesses are valued at 2.5-4 times sales. Also most š Essentially, there is no competition the way F&V
businesses which are growing at 15-20% sales growth & Sector needs to be developed and positioned. There
25-35% PAT growth can be valued between 35-45 PE is massive opportunity for many players to emerge
When ROE are also rising. as a national player and build markets globally.

Reasons for Sales expansion: š Hence, discussion on competition and margins etc
are not so important actually when India at large is
Sourcing strengths, operations bandwidth, reach with completely unserved & underserved both for certain
supply chain logistics partners, team capabilities, critical parameters of supply & Services in F&V
experience of organisation, energy, passion & Vision in Sector.
founders & core team are the key essential ingredients
for F&V business sales expansion. š Standardization, Formalization & Consolidation &
Collaboration in F&V industry are the major
Prime Fresh has already built a massive sourcing (1 lac opportunities.
tonnes capacity) and distribution network (Vast
network of clients under Omni channel strategy) which To summarise our research, Team Prime strongly
has a potential to do a 35000 tonnage sales over the believes and is consistently working towards:
next 2-3 years from 12000 tonnes currently. Ÿ Establishment to Integration to Collaboration - laying

a foundation for an organised tomorrow

Www.indianbusinesstv.net 15 Www.indianbusinesstv.net

SBJ

Cover Story

Www.indianbusinesstv.net 16 Www.indianbusinesstv.net

SBJ

Cover Story

Www.indianbusinesstv.net 17 Www.indianbusinesstv.net

SBJ

Cover Story

Journey - Bird Eye

Year Ÿ Started with a small warehouse for Fruits & Vegetables in the year 2007
2007 Ÿ Initiated idea of Fruits & Vegetables reaching at the consumer door steps with designer Vans

in April 2007
Ÿ Started our first 3PL facility for Fruits & Vegetables in Ahmedabad in September 2007 For

Aditya Birla Retail
Ÿ Started with trading and Value Added Services of Fruits & Vegetables in the same year of

September 2007.

Year Ÿ Started with our second facility of 3PL services for Fruits & Vegetables and Dairy Frozen
2008 Category for Reliance Retail in December 2008.

Ÿ Started providing Training, HR Management and Manpower placement services to the
corporate clients in June 2008.

Year Ÿ Started services of hygienic packed food to the corporate in Ahmedabad in April 2009
2009 Ÿ Started our bulk trading of fruits in APMC Ahmedabad September 2009.

Year Ÿ Started providing skilled manpower to the corporate in February 2010.
2010 Ÿ Started our first 3 PL services for Intas Pharma in the packaging industry in the

Pharmaceutical sector in July 2010.

Year Ÿ Started our 4th 3PL facility in Fruits & Vegetables and Dairy & Frozen category for Aditya
2011 Birla Retail in April 2011 in Mumbai.

Ÿ Started our 5th 3 PL facility for F&V for Reliance retail in May 2011 in Pune.
Ÿ Started our first warehousing facility for Pharmaceutical industry in May 2011 for Intas

Pharma in Ahmedabad.
Ÿ Started our first warehousing facility for FMCG industry for Waghbakri Tea in December 2011

in Ahmedabad

Year Ÿ Introduced first refrigerated mobile van for Fruits & Vegetables in Ahmedabad in February
2012 2012

Ÿ Established our first wholesale Fruits & Vegetables Shop facility in Ahmedabad in May 2012.
Ÿ Established our first ripening chamber cum cold storage facility at Ahmedabad in August

2012
Ÿ Started our collection centre facility for F&V at Pratij in November 2012.

Year Ÿ Started our 6th 3 PL facility for F&V For Subji India in July 2012 and 2nd in Pune.
2013 Ÿ Started supply of F&V to food processor.

Www.indianbusinesstv.net 18 Www.indianbusinesstv.net

SBJ

Cover Story

Journey - Bird Eye

Year Ÿ Tie-up with APMC Ahmedabad in Sep 2014 for their Retail based Potato and Onion
2014 distribution project.

Ÿ Added more clients Like Corona and 20 Cubes in Manpower (pay rolling) category for
Ahmedabad.

Year Ÿ Started Corporate Tie-up for procurement with Reliance Jamnagar for Mango, for Pomegranate
2015 with INI farms and for Imported fruits with Mahindra and PC Foods Pvt. Ltd (Nasik)

Ÿ Started operation for BISLERI India Pvt. Ltd. as a C&F at four location of Gujarat
(Ahmedabad, Surat, Baroda and Rajkot).

Ÿ Started Export to UAE from May 2015 for products like Mango, Onion, Potato and other fruits
and vegetables.

Ÿ Planning to start Lease Farming and Contract farming.

Year Ÿ Started Corporate tie-up for Operation with Reliance Retail Market, Pune
2016 Ÿ Filed Draft Red Herring Prospectus (DRHP) for listing of SME IPO at BSE Platform
Ÿ Registered at Corporate Journal for Business Profile
Ÿ Registered more agreements for supply of F & V at Jalana, Mahrashtra.
Ÿ Started Collection Centre for Pomegranate at APMC, Lakhani, Dist. Disa.
Ÿ Incorporation of Wholly owned Subsidiary Company of PCSL as Florens Farming Private Limited
Ÿ Planning for Export Business of F&V.

Year Ÿ Successfully got listed on BSE SME Platform.
2017 Ÿ Started Collection Centre for Mango at Valsad.
Ÿ Entered into Farming through a Joint Project with Farmer from September, 2017.

Year Ÿ Company successfully enhanced its Farmer network to 15000 across Maharashtra, Gujarat
2018 and Rajasthan.

Ÿ Penetrated into new geographies through supplying to Exporters, Modern Trade and food
processing companies.

Ÿ Entered into Pomegranates farming.
Ÿ Entrered into Bakery business and started manufacturing of bakery products for Reliance.
Ÿ Sourcing of Pomegranates from multiple locations in Rajasthan directly from farmers.
Ÿ Associated with Havmor for providing 3PL services.
Ÿ Deemed exports of Onion in FY 18 - 3,01,93,202/-.
Ÿ Activated many new clients for Fruits supply like Future group, Big Basket, HAS juice, Metro-

cash and carry, Capricon Food and few more.
Ÿ Established several new relationships in Maharashtra across 19 districts for Fruits and

Vegetables procurement.
Ÿ Successfully scaled up Maharashtra operations through regular activities and transactions at

Nashik and Mumbai.
Ÿ SMERA upgraded ratings to MSE-1 : This upgrade is the highest rating reflecting solid

Financials, Management and business performance.

Www.indianbusinesstv.net 19 Www.indianbusinesstv.net

SBJ

Cover Story

Journey - Bird Eye

Year Ÿ SMERA ASSIGNED THE Highest rating to PCSL " MSME 1", CRISIL assigned the rating BB+
2019 Stable

Ÿ PCSL now is ISO rated company
Ÿ Started Collection Centers to procure Pomegranate & Onions from nearby farming belts at

Indapur and Sangola in Maharashtra and Padaru in Rajashthan.
Ÿ Tapped new export destination i.e. Netherlands for mangoes
Ÿ Added more customers in the North East region
Ÿ Geared up the brand building exercise for “Prime Fresh” through corporate selling at Office

Complex of Aditya Birla, WeWork and being a part of exclusive Mango exhibition "
Aamrotsav" held at Kandivali, Mumbai etc.
Ÿ Constant efforts on expanding the farmer network and their education through seminars
and farmer gatherings.
Ÿ On boarded marquee clients like Future Group, Big Basket, HAS juice, Metro (Cash & Carry)
and Capricon Food
Ÿ Strengthened the B TO C business reach to 40000 plus customers across Ahmedabad
,Gujarat & Mumbai for Direct to home and Direct to office model
Ÿ Established association & collaboration with various pack-house in Gujarat and Maharashtra
Ÿ Accelerated collaboration with many new age AgriTech startups.
Ÿ Strengthened the B2C business aggregating to an orbit of 40000+ customers across
Ahmedabad, Other parts of Gujrat & Mumbai for Direct to home and Direct to office model.
Ÿ New initiatives to deepening the efforts across multiple districts in Maharashtra for
procurement of grapes and orange being the new categories
Ÿ Developed internal mobile application for Field workforce team aiming at better reporting
practices, improved productivity with accuracy.
Ÿ Ramping up of Nashik operations for Grapes and Tomatoes
Ÿ Established Collection center for Grapes at Tasgaon-Sangli, Maharashtra
Ÿ Added new client Vasant Masala in Service segment of the businesss - Gujarat

Year Ÿ Availed various certifications to export F&V to Europe
2020 Ÿ Started exports of Grapes to Netherlands
Ÿ Expansion in B2C operations of packed fruits and vegetables in Ahmedabad and Mumbai to

support the fight/war against COVID-19
Ÿ Company got approval from MCA , ROC and BSE for the name change request from " Prime

Customer Services Limited" to " Prime Fresh Limited" which reflects our accurate business
profile of dealing in Fresh Produce
Ÿ Supplied Papaya 161 mt and tomato 250 mt for processing industry at Nashik, Maharashtra.

Www.indianbusinesstv.net 20 Www.indianbusinesstv.net

SBJ

Interview

We are today a well-known brand

Cospower Engineering Ltd

What is your product portfolio?

Our core product is capacitors and its related equipment. This
is also the core competency of our company. This product is
directly related to power saving and power quality
improvement. In power intensive units this product is very
crucial and dictates the profitability of the company. Apart
from our core products, we deal will various related electrical
products, as our customers wish to take all services from a
single source and under one roof. About 3 years back we also
diversified into mechanical works and today it is one of our
regular line of business.

What is the breakup of your product portfolio in terms of
volume?

While capacitors and its related equipment constitute to Felix Kadam
almost 60% of our business around 30% is related to various
other electrical product and balance business is from the
mechanical side.

What is your product portfolio in terms of value?

As mentioned earlier, if we convert %age into value, then we capacitor. But based on very rough estimates for capacitors
have done around 8 to 9 crores in our core product and little the business volume in the entire county should be not less
more than 4 crore on other allied electrical equipment. We than 600 crores. This is just a conservative figure and could be
are doing regularly business of 1 to 1.5 crores on our new more. For other products the volumes are quite big, and our
business of mechanical works. company is having just a micro miniscule share of the total
business in India.
Who are your main customers and each contribution to
volumes? What is the market size of each of your product?

I could divide my customers into 3 categories i.e. Private I think I have answered this question above.
clients which 50% of our business volume - which includes
most of the medium and large size steel industries, cements What is the geographic area of your market?
industries and various other industries like commercial
establishments, hospitals, malls and 5-star hotels. We try to cover the entire length and breadth of our country
Government Sectors which contributes 35% - we work with and being based in Maharashtra our maximum business in from
public and power utilities, fertilizers plants and oil & this state. But we have now developed offices in all four zones
refineries, coals fields etc. In Exports, in which contribution is of the country and are expecting a good contribution from all
around 15% of the volume, we cater to overseas private the 4 zones. Also, our focus country for exports so far is
industries especially from steel sectors. African countries and Bangladesh.

What is the market size for your various products? What is your major cost component and what percentage of
sales does it account for?
It's very difficult to define the market size as there are a
variety of capacitors for different application and some The major cost of components is related to our core business
manufacturers in India are in more than one variety of and it accounts to around 60% of our total business.

Www.indianbusinesstv.net 21 Www.indianbusinesstv.net

SBJ

Interview

Who are your major competitors? has been action plan adopted by us for brand building. Now
with us going public we are confident that it will surge our
In a sense, our business model is supply + service, the actual brand image in widening of visibility. We also plan to
competition would be from a company with similar business participate in crucial exhibition to give a thrust to our brand
model. Considering this we may have maximum 5 to 6 actual image.
competitor for our core business. At this stage I will refrain
from naming them for some obvious reasons. What are your mission, vision and value statements?

What are your plans for brand building? I will sum as follows – A professionally managed company
working to satisfy our clients and employees; Emphasis on
Brand building has been ongoing process in our company. From profit for the benefit of promotors and shareholders;
a new entrant in 2004, we are today a well-known and Contributing to the nation resolve to save power and create
established brand. Advertising, seminars and mouth publicity employment.

Turnover to Double in 3 Years

Is there scope for foraying into different geographies?

As mentioned by Felix there is tremendous scope is different
zones of our country. Not that we don't have any presence in
these zones, but we can do much better. You see, our business
needs an excellent service back up and now that we have our
engineers at all places, we are confident to emulate the
business strategy adopted in Maharashtra, to other parts of
the country. Already we are experiencing the success in
Eastern region which was like alien region for us earlier. This
will also happen in other regions too.

As far as exports are concerned, we now have a team which
has the experience and expertise to develop international
market and have plans in place to make inroads in other
countries too.

What is your capacity in various products as of now?

If your ask in terms of value, we can easily manage up to 30 cr Oswald D’souza
business with our present set up. At the same time, we have
drawn a road map of scaling up our capacity in the next 2 well we can manage our after sales services and for this we
years. We are taking every step carefully and looking at the will need to build a strong manpower. We already have in
business scenario as well. I am sure and confident to we will be place a good team which can easily cater to even 100% rise in
able to cope up with our capacity smoothly w.r.t business business. Strengthening of manpower is an ongoing process
increase in coming years. which involves picking up the right person and providing them
proper induction and training. For this our company already
What is the potential for growth in each product segment? has a well prescribed and documented process in place.

I think there is tremendous scope. In capacitors we have What would be the likely turnover on full capacity
market share below 2% and with the emphasis on different utilization of each product and in what time frame will it be
regions we should be able to give a strong push to business achieved?
volume in capacitors. You see, business is about numbers and
even 1% boost in market share in our core product will give us I will only tell about our core product. In 3 years from now we
40% more business compared to our volumes today.

As for our other products sky is the limit. It is all about how

Www.indianbusinesstv.net 22 Www.indianbusinesstv.net

SBJ

Interview

should easily be able to double our present turnover i.e. concerned, if we get a breakthrough this year, it will
from15 cr to 30 cr. At the same time, we will easily be able to contribute at least 5% to 7.5% additional turnover in the first
manage this turnover with our existing infrastructure and our year. We are not looking at a big profit margin as it will be
present work-force. So, in other words I can say it easily that altogether a new line of business and establishing it will be
30 crores business it the present capacity of our the priority. But without any doubt it will certainly add to the
infrastructure and manpower. overall profitability of the company.

What is your main raw material, from where it is sourced, What is the margin of profits in your existing business
what is the availability? And what is the cost in percentage product wise, and is there scope for improvement?
terms to sales ?
As mentioned earlier we work at an RMC of 70% to 75% for all
Fortunately, all our raw materials are sourced indigenously products put together. With the kind of competition getting
and there are no qualms about its availability and more stiffer getting higher selling price is quite a remote
importantly its quality. I want to add here that we procure our possibility.
raw materials only from the top 3 OEMs in India. But yes, we are working on reduction of costs and are being
guided by experts for this. Even if we are able to reduce
Coming to the cost of the materials with respect to sales, expenses by 3% and with an increase in turnover by 30% as per
generally, the average RMC will be 70% to 75%. our plans, we will end up with an increase of profit by almost 3
times in the next 2 years. So, our mantra will be increasing
Do you have any expansion and diversification plans? the turnover and reducing expenses.

As mentioned earlier we are in the route of expansion of our How do you look at survival in an era of disruption?
infrastructure. This primarily is to cope up the increase in
business volume in future. We are catering to clients who are falling under the umbrella
of infrastructure development. So, our growth and survival
We have recently diversified into mechanical works and have are directly related to the pace of infrastructure
supplied large size pump check valves to a public utility in development. We all know very well the efforts being put by
Mumbai. We have a firm understanding with an overseas the government towards the cause of infrastructure
world reputed company for supply of this large size valves. development. Yes, there is a temporary brake due to the
These products are presently sourced by only very few players lockdown caused by the pandemic. But sooner than later this
in the world. will be over and life will be back to normalcy. I think this is a
time when ‘men will be separated from boys’.
Another new line of business that we are planning is of
turnkey contracts of Gas Insulated Substation and there is Do you plan to achieve cost leadership in all the segments
already an ongoing discussion with a reputed OEM in India who that you operate?
will supply the equipment.
Why not ? I think achieving cost leadership is the best strategy
If so what would be the cost and means of finance ? to increase sales and ultimately profit. As I said earlier
increasing turn over and reducing expenses will help us to
For our present plan, we do not envisage the need of finance. achieve cost leadership. So, everything is inter-related. We
We already have the team and will need to add some skilled have proper MIS in place to monitor the progress of our tun
manpower. But coming to finance, may be in the future when over vis a vis profits and this will help us determine the
things turn for the better than our expectations and there are optimum costs and come closer to achieving cost leadership.
higher opportunities, we will consider about it at the
appropriate time. In case of negative events do you have a contingency plan
ready for implementation ?
What would be the time frame for completion and the
contribution to turnover and profits ? Yes. We shuffle our sales target, and this has always been the
business strategy of our company. Market will always have its
For Gas Insulated Substation, as I said, we are in the process ups and downs. We are in close touch with the changing
of discussions and we expect some good breakthrough in this situation. Luckily, we also cater to public and power utilities
Fiscal. But I am not sure what will be the scenario post which will always remain steady irrespective of market
lockdown as the projects we are targeting are green fields. conditions. Whenever the market condition is bad, we put
We have to wait and watch. Yes, as far as the contribution is more emphasis on government public and power utility

Www.indianbusinesstv.net 23 Www.indianbusinesstv.net

SBJ

Interview

business and modify our sales targets. plunge into business. What we had was only technical
expertise and the best wishes of our elders. We used our
Do you have any acquisition plans? contacts and the faith of our clients to a very good effect. We
continue to enjoy the confidence of our clients and that is one
Presently no such plans. Our concentration is on growth with factor that's keeping the fire in in our bellies burning. I am 57
present infrastructure and manpower. today, but my enthusiasm to learn finer aspects of business,
technical update and system improvement matches one of a
What would you consider your strongest and weakest links 40 years old. No plans to hang boots but infact the passion to
of your organization? increase the business manifold is unrelenting.

Well strongest will be technical expertise, strong team, Do you aim to reach global standards in your business?
Professional approach and proper systems in place. In our
company the system process works like a well-oiled machine We already have a world class product and made some good
and the team has just to follow the process. I consider this as business overseas. Now with the new dimension that the
the strongest feature of our company. For the weak links I company has acquired, we will not spare any efforts to make
would say our reach out to clients in virgin territories need to our global reach stronger and wider. We have new additions to
improve. We will need to also strengthen our account our team and with their good contacts across the globe and
process. Here I can definitely see a good scope for we will exploit every opportunity.
improvement.
How do you propose to leverage technology in your
How do you propose to address your weak links? business?

We have already addressed these weak links and are plugging We are already doing this in the best possible manner. Our is a
the gaps. As I told we are reaching out to every corner of our technical product and both the promotors are technically
country with offices in all four zones. In addition, we are qualified. Hence, we are heavily inclined toward technology.
establishing a stronger network partners who will be our All our systems are adapted to the latest IT trends which will
extended arms. This is not just for India but some countries give accessibility of our business and product profile to any
overseas too. Practices like identifying and searching new place in the world. This will give our engineers to work from
projects and also prospecting new clients is a part of our any part and provide quick response to our clients. We are
business routine. also introducing system in our end product which can be
monitored from our office or for that matter any place in the
On the finance side, we have appointed internal auditors who world.
are checking our accounts and they will put in place some
system which are already initiated like various MIS which will You launched your IPO in the worst of times and even issues
give an overall picture of the company's finances. like Burger King had to be withdrawn but your IPO was
oversubscribed over 1.50 times. Also world over the
Are there any plans on innovation? largest IPO in the world in the form of Aramco is quoting at a
discount to the IPO price. In India SBI credit card is also
We had recently about 1 ½ year back launched a new product quoting at a discount to the IPO price whereas your IPO is
called CosVar Manager as a solution to counter the new power quoting at a hefty premium in a short span of time
tariff order passed by MERC. This has been successfully generating a return an annualized return of over 700%. In
adopted with most of our existing clients. We are working on this regard What would be your approach towards
further innovating this product with a better 'human machine investors?
interface' and making it more user friendly. We also have
other new products in pipeline which is presently in very Firstly, I will use this platform to thank all our investors for
nascent stage and hence a bit premature to announce. reposing the faith in us and supporting our IPO even in the
most difficult times. We will certainly justify their confidence
How passionate are you about your business? in the company. We already have a strong business plan and
today we are all the more motivated to ensure that our
Absolutely passionate. Started with zero and a capital of just business plans are executed, and the targets are achieved.
`5000/- from each partner, we toiled hard to bring the Needless to mention that once our projections are met which
company to its present level. We have no family business we are fully confident to meet, the beneficiaries with be our
history and infact we are the first in our families to take a shareholders.

Www.indianbusinesstv.net 24 Www.indianbusinesstv.net

SBJ

Interview

Focus On Innovation & Technology

1. What is your core business?

SecMark is a consulting firm offering services in the areas of
Compliance, Operations, Software Development, Risk
Management and Arbitration & Legal Matters to financial
market participants.

2. What are the unique strengths of your company?

Ÿ Thorough domain expertise in functional areas of services Jignesh Mehta - CEO & MD
Ÿ Faith of clients SecMark Consultancy Ltd
Ÿ Values and Integrity
Ÿ Innovative solutions to business problems have a strong hold of the working in this Industry. Low attrition
Ÿ Strong Technology Capabilities rate has ensured retention of quality talent for a long time.
Ÿ Focused approach on serving Financial Market Participants
Ÿ Young, dynamic and energetic team 7. Who are your blue chip clients?
Ÿ Desire of achieving customer delight
Clients are a mix of Exchanges, Brokerage Houses (Domestic &
3. What have been the major achievements of your company? MNC), FPI, AIF, Hedge Funds, Depository Participants, Wealth
& Portfolio Managers, Research Analysts (RA), Investment
In a short span of time, we have carved out a niche for Advisors (IA), Insurance Companies, NBFC, Banks & its
ourselves and can proudly claim to be a unique player in this subsidiaries. Most of our clients are market leaders in their
industry with many business verticals. areas in India.

4. How much strong is your brand? 8. How do you foresee the future of your company?

We have served more than 150 clients under various Since we are operating in a niche area, we are very well placed
categories as market participants that makes our brand value to embrace the future & grow at a rapid pace. Our focus is on
is very strong. We have presence in few other major cities like technology like RPA, AI, ML, etc. which will be the driver of
New Delhi, Ahmedabad, Indore, Jaipur and Raipur. We are in future and enable our growth.
the process of opening offices in Southern and Eastern India;
but these plans are on hold till COVID-19 lockdown protocols 9. Any other important point you may like to share?
are eased.
The current situation of pandemic that gripped the world has
5. How do you look at the opportunities? created a new normal for people. An example that comes to
mind is Work from home (WFH); it was being facilitated by few
Favourable market conditions on the back of overall growth in companies and was not very popular but now they will have to
the sector. Technology driven services, Regulatory stringent look for implementing this. As part of our expansion, we are
approach requiring specialized teams to handle tasks and planning to go public within next year and will be listing on the
situations. Using technology to reduce transaction cost, SME segment of BSE.
improve compliance. Acceptance of outsourcing as a suitable
business model. We believe that clients should focus on what
they are best at and outsource the rest.

6. What would you like to highlight about your team?

The team has vast experience in various sectors and thus we

Www.indianbusinesstv.net 25 Www.indianbusinesstv.net

Leading

Pharmaceutical
Intermediates and Fine Chemicals
Manufacturer in India

Chloroalkyl Cyclopropyl Acid
Salts Derivatives Chlorides

Carboxylic Fine
Acids Chemicals

Shree Ganesh Remedies Limited

Plot No. 6011 & 6012, G.I.D.C Estate, Ankleshwar, Gujarat, India - 393002
Phone: +91 75749-76076 / +91-2646-227777
Email: contact@ganeshremedies.com
Web: www.ganeshremedies.com