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Apex Frozen Foods the most successful IPO of 2017
Updated on 29 Dec 2017
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Apex Frozen Foods the most successful IPO of 2017
IPO Apex Frozen Foods has given 380% returns in single year of 2017

The initial public offer (IPO) of Apex Frozen Foods, which received tepid response from the market on its listing in September, has given 380 per cent returns from its issue price. The stock, issued at Rs 175 per share, was locked in an upper circuit at Rs 840 on Thursday.
The demand for the IPO was not very encouraging: it was subscribed less than three times in comparison with over 100 times for contemporaries, such as Avenue Supermarts. Andhra-based Apex Frozen Foods, a leading producer and exporter of shrimps in India with presence across value chain - from hatchery to port, has its own brands, which it sells to retailer chains, restaurants, club stores and distributors.

When the company posted strong numbers in the September quarter, the market was quick to realise its growth potential. Success of Avanti Feeds - the largest shrimp feed producer whose market capitalisation has risen over 1,000 times from Rs 10 crore to over Rs 10,000 crore in less than 10 years - also brought the Indian shrimp industry on the radar of several investors.

According to analysts, the stock's dream run is not over yet and it could still have some steam left for investors with a long-term horizon. And a key reason for that is shrimp's robust demand overseas. The demand for Indian shrimps is on the rise in the US and Europe. India's share in the global exports has risen from 4.5 per cent in 2010 to 7.8 per cent in 2015.

It is understood that the share has further gone up in the past two years, and by 2020, the contribution is expected to touch 10-12 per cent, according to the reports. Additionally, leading shrimp exporters, such as Vietnam and Thailand, are losing market share. For example, Vietnam's market share fell from 15 per cent in 2014 to 10 per cent in 2015.


In the September quarter, the company did Rs 532 crore revenues against Rs 699 crore for the entire FY17 and Rs 39 crore net profit as against Rs 24 crore for the entire FY17. Although the second half is usually not as good as the first half due to winter, the company is expected to deliver more than 100 per cent yearon-year growth for the current fiscal.

When the company posted strong numbers in the September quarter, the market was quick to realise its growth potential. Success of Avanti Feeds - the largest shrimp feed producer whose market capitalisation has risen over 1,000 times from Rs 10 crore to over Rs 10,000 crore in less than 10 years - also brought the Indian shrimp industry on the radar of several investors.