- 27 Oct 2022
- ICICIdirect Research
DABUR ACQUIRES 51% STAKE IN BADSHAH MASALA
DABUR - 509 Change: 1.95 (0.38 %)News:
Dabur has acquired a 51% stake in Badshah Masala Pvt Ltd (BMPL) at a considerable of Rs 587.5 crore valuing the company at Rs 1152 crore. Balance 49% stake would be acquired after five years. BMPL's FY22 sales were at Rs 189.1 crore and it estimates FY23 sales of Rs 256 crore with 22.9% operating (EBITDA) margins. This translates into acquisition multiple of 4.5x to FY23 sales & 19.6x FY23 EBITDA. With this acquisition, Dabur has forayed into the spices category.
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With this acquisition, the company has forayed into the spices segment. We believe the company is increasing its addressable market by entering many foods categories, which are either dominated by the unorganised segment or has large growth potential. This would help the company to grow at a higher sustainable pace for a longer period of time.
Impact:
Positive.