Ajooni Biotech     

Published: Nov 30, 2022
Updated: Nov 30, 2022

Ajooni Biotech - Rs 29.01-crore rights issue

Ajooni Biotech Ltd (NSE – AJOONI), a leader in animal healthcare solutions and animal feed supplements, is scheduled to open its Rs 29.01 crore rights issue on December 7. The funds raised through the issue will be utilised to meet the working capital requirements for the company’s expansion plans, entering new geographies and for general corporate purposes. The company is offering a rights issue at an attractive price of Rs 6 per share. The issue closes on December 15.

The company will issue 4,83,60,313 fully paid-up equity shares of a face value of Rs 2 each for cash at a price of Rs 6 per equity share (including a premium of Rs 4 per equity share), aggregating Rs 29.01 crore. The rights entitlement ratio for the proposed issue is fixed at 29:30 (29 equity shares of a face value of Rs 2 each for every 30 equity shares of Rs 2 each held by equity shareholders on the record date of November 25). The last date for on-market renunciation of rights entitlements is December 9, 2022.

Commenting on the development, Jasjot Singh, Chairman and Managing Director, Ajooni Biotech, said, “The company has taken important strategic initiatives in the recent past with a focus to expanding production capacities, launching new products, adding more channel partners and working with more farmers. Our long-term focus continues to be investing in growth through new product launches and expanding out footprint. We have a dedicated focus to leverage capabilities, develop cost-effective solutions to improve animal productivity and accomplish our vision to be a world-class animal health care company. Proceeds of the issue will further strengthen the company’s balance sheet and help fund its expansion plans and strategic growth initiatives.”

The company’s board of the directors on October 17, 2022 approved the issuance of equity shares by way of a rights issue to eligible equity shareholders for an amount not exceeding Rs 30 crore. Post the rights issue, total outstanding shares of the company should increase to 9,83,88,223 equity shares from 5,00,27,910 equity shares prior to the rights issue.

Win-win for shareholders

• Funds raised through the issue will be used to meet working capital requirements of the company’s business activities, fund the company’s expansion plans and for general corporate purposes.
• The rights entitlement ratio for the issue is 29:30; 29 rights equity shares of a face value of Rs 2 each for every 30 equity shares of Rs 2 each held by equity shareholders.
• The company had fixed November 25 as the record date for the purpose of determining equity shareholders entitled to receive the rights entitlement in the rights issue.
• The company launched its IPO on the NSE Emerge platform in December 2017 and migrated to the main board of NSE in May 2022

ALL FOR ANIMALS

Established in 2010, Ajooni Biotech has emerged as one of the leading animal healthcare solutions companies dedicated to improving the productivity of dairy farmers and sustainably increasing livestock yields. The company offers a wide range of products, including quality cattle feed, cattle feed chips, camel feed, cotton oil cake and mustard oil cake, and a wide range of feed supplements to cover the entire life cycle of an animal. The company has two state-of-the-art manufacturing facilities with a cumulative animal feed production capacity of 60,000 mtpa and a liquid supplements capacity of 30 lakh litres per annum. The company is currently working with more than 10,000 farmer families in seven states of Northern India and plans to grow nationally. Ajooni is also an ISO- and GMP-certified company, manufacturing ISImarked cattle feed.

In November 2022, Ajooni became the first Indian animal feed manufacturing company to get a ZED certification (Zero Effect, Zero Defect) from the Ministry of Micro, Small & Medium Enterprises, Govt of India. The company is Registered with the Department of Dairy Development, Govt of Punjab, and is India’s first GMP-certified cattle feed company with ISO 9001:2015. The company is registered with the Bureau of Indian Standards (BIS) and manufactures ISI-marked animal feed. It is among the main suppliers to leading companies like IFFCO Kisan, Mother Dairy, Paras Dairy and Saahaj Dairy.

The Indian animal feed market was valued at Rs 873.7 billion in 2021. Looking forward, the market is projected to reach Rs 1,493.8 billion by 2027, exhibiting a CAGR of 9.6% during 2022- 2027.

For FY 22, the company reported sales of Rs 74 crore for growth of 46% as against Rs 50.8 crore in FY21, EBITDA grew 88% to Rs 3.08 crore and net profit registered a 183% rise to Rs 1.05 crore. The company has achieved a strong CAGR of 23% in sales, 37% in net profit and 65% in EBITDA during the last 3 years with an improving return ratio. The promoter group’s holding in the company is 67.35% as on September 30, 2022.

EXPORT TO NEPAL

With an objective to expanding the Ajooni brand in global markets, the company has executed its first export order for supply of Ajooni cattle feed to Nepal after successful field trails in the hilly country. It has developed a unique product suitable to the specific feed requirements of animal species of the semi-hilly areas of Nepal and Bhutan to achieve optimal nutrition, gut health and pathogen control of livestock while maximizing the profitability of dairy farmers of these countries.

It is also exploring all possibilities to penetrate its marketing network in the international markets of the African continent, South Asia and the Middle East.

Ajooni has reported robust a financial performance over the last 5 years. Sales grew at a CAGR of 21% to Rs 74 crore in FY22 from Rs 28.5 crore in FY17. EBITDA and net profit too have maintained a strong 30%-plus CAGR during 5 years from FY17 to FY22.