1:5 Stock Split: Record Date Next Week On 8th March; Buy The FMCG Stock To Be Eligible?

With a market value of Rs 2,480 Cr, Manorama Industries Ltd. is a small-cap company in the FMCG industry. Manorama Industries Limited is a prominent fast-moving consumer goods (FMCG) firm that was founded in 2005 and led the way in the production of oils and fats from trees in India. The firm produces plant-based speciality oils and fats, which are longer-lasting, more sustainable, and healthier than conventional oils and fats. Next week, the FMCG stock will be the subject of attention due to a 1:5 stock split, for which the record date is Friday, March 8, 2024. According to Manorama Industries, the corporate action stock split has been announced to enhance the liquidity of its equity shares and encourage the participation of small investors by making its share more affordable.

Manorama Industries Stock Split

The Board of Directors have approved "Sub- Division /Split of the Equity Shares of the Company having face value of Rs 10/- (Rupees Ten only) each into 5 (Five) equity shares having face value of Rs 2/-(Rupees Two only) each, subject to regulatory/statutory approvals and approval of the members as required under Section 61 of the Companies Act, 2013," said Manorama Industries in a regulatory filing.

"Pursuant to Regulation 42 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, this is to inform you that the Company has fixed Friday, March 08, 2024 as the "Record Date" for determining entitlement of Equity Shareholders for the purpose of sub-division/stock split of existing Equity Shares of the Company, such that 1 (one) equity share having face value of Rs. 10/- (Rupees ten only) each, fully paid-up, will be sub-divided into 05 (five) equity shares having face value of Rs. 2/(Rupee two only) each, fully paid-up, ranking pari-passu in all respects which was approved by the Equity Shareholders through Postal Ballot on Wednesday, February 14, 2024," the company further stated.

Manorama Industries Financials

For the third quarter and nine months ending December 31st, 2023 the company reported net sales of Rs 98.45 crore up 3.23% from Rs. 95.38 crore in the December 2022 quarter. Its net profit stood at Rs. 7.44 crore in Q3FY24 up 3.87% from Rs. 7.16 crore in Q3FY23. Its EBITDA reached Rs. 19.70 crore in the recent quarter up 19.83% from Rs. 16.44 crore in the same quarter of the previous fiscal.

President of Manorama Industries, Mr. Ashish Saraf said, "The Company achieved a substantial 31.6% YoY revenue growth, reaching INR 3,277.5 million in the first nine months of FY24, despite a maintenance shutdown impacting fractionation capacity at Birkoni in Q3FY24. The domestic-to-export mix for Manorama Industries stood at 56:44 during this period, with strong demand observed in export markets such as Russia, Latin America, Japan, and Europe."

"EBITDA saw a significant 32% YoY increase, totaling INR 527.5 million in 9MFY24, with an EBITDA margin of 16.1%. The Company's planned capex is progressing as scheduled, and the new fractionation capacity is anticipated to commence by the end of FY24. We have strategically built inventory due to seasonal procurement of Shea Nuts, Sal Seeds and Mango kernels, resulting in increased finance costs attributed to higher working capital. The expanded fractionation capacity positions us to meet growing customer demand, reinforcing our position in the global CBE and specialty butter and fats industry. This added capacity is expected to drive incremental sales and profitability," he added.

"We are actively working to accelerate our growth momentum. Exploring opportunities to deepen our presence in existing geographies, the Company is considering establishing entities in the Russia, Latin America, UAE and other markets. Furthermore, leveraging our expertise in the Chocolate & Confectionery industry, we are evaluating diversification into manufacturing real chocolate, super compound slabs, compound chocolate, and specialty cocoa products for both Indian and global markets," Ashish Saraf stated.

"As part of our commitment to sustainability, the company continues to implement robust ESG practices, reinforcing our unique 'Waste to Wealth' business proposition and creating long-term value for our esteemed investors," he commented.

Manorama Industries Share Price Target

Manorama Industries is slightly bearish on the daily charts with strong resistance at 2100. A daily close above this resistance could lead to a target of 2250. Strong support is at 1965, said AR Ramachandran from Tips2trades.

Disclaimer

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