Flexituff International IPO Coming
Flexituff International is a leading bag manufacturer in India. They are trying for an IPO by issuing 65,00,000 equity shares of Rs 10(Face Value) each. Company has filed a red hearing prospectus with the market regulator SEBI. The premium will be decided by 100% book building process. The IPO amount will be used for the working capital requirement and expansion of the manufacturing facility at Pithampur. The IPO price band will be available soon. The issue comprises fresh issue of 45,00,000 shares and an offer sale of up to 22,50,000 shares held by Clearwater Capital Services (Cyprus) Limited. They have 26.07% stake in Flexituff International. Their stake will be reduced to 10.3%.
20th century witnessed numerous inventions. Out of those inventions, plastics were very important and rewrote the development. 90 Million Tones of plastics are produced in each year. We cannot imagine a life without plastics. Indian Polymer industry is very attractive. Steady growth is expected here. Large projects are under construction. Per capita consumption of polymers in US is 90 Kg p.a. In India it is only 4 kg. there is huge growth is expected in the Indian infrastructure sector in the coming years. It will boost the polymer industry too.
Indian Packaging industry is a very promising. It is important for the distribution, storage, sale and use of products. Every product has to be covered well before moving. Packing protects products which are going to consumer from manufacturer. It is the time of globalization and also the time of packed foods. Quality product is the first goal of every business. If we believe India growth story, Packaging industry will be a beneficiary.
Urbanization is one of the features of globalization. Extensive urbanization process can be seen in India. The factors like the arrival of organized retailers ensure the future of Indian Package Industry. Moreover the people are very conscious about their health and they prefer packed foods. The purchasing power capacity of Indians is low compares to people in the developed countries. So the products are available in small packets. Potential of consumer food industry increase the potential of package industry.
According to the BMI India Retail Report, huge growth can be expected in the Indian retail sales by 2014. Easy availability of personal credit and the increasing vehicle population indicates India’s upcoming increase in the retail sales. 11.4% growth rate is expected in the Indian retail sales. India is the most attractive emerging market for retail investment. Only 5% of the retail sales are in the organized sector. That discloses the growth potential.
Company reported net sales of Rs 321Cr in FY 2010. Company also reported a net profit of Rs 4.6 Cr in that period. Company reported net sales of Rs 268.8 Cr and a net profit of Rs 13.4 Cr in the six months ended Sep 2010. FIBC, Geo-Textile Fabric Ground Covers, Reverse Printed BOPP Woven Bags, Polyolefin Woven Sacks and Leno Bags are the main products of the company. Good growth is expected in the coming years. Investors can consider it as a very good buying opportunity.