Mother Nutri BSE SME IPO review (Not Rated)

•    The company is engaged in the manufacturing and marketing of peanut butter on a B2B model.
•    It posted growth in its top and bottom lines for the reported periods, but the sudden boost in its bottom lines from FY24 onwards is surprising.
•    It has on an average over 97% revenue from private labeling business that includes around 68% domestic and the rest international.
•    Based on its recent financial data, the issue appears fully priced. 
•    Well-informed investors may park funds for medium to long term.

ABOUT COMPANY:
Mother Nutri Foods Ltd. (MNFL) is a B2B peanut butter manufacturing Company offering 10 flavours and 12 ranges of peanut butter. It also offers the peanut butter under own brand “Spread & Eat” in countries like Libya and Dubai. Further, the company has recently started selling the peanut butter in Japan under own brand. It also engages in private labeling, manufacturing peanut butter for domestic and international customers, including hypermarkets, supermarkets, and retail chains. MNFL’s private label clients are based in countries such as the United Kingdom, Canada, South Africa, Mauritius, Russia, the British Virgin Islands, Spain, the United Arab Emirates, Saudi Arabia, Nepal, Bangladesh, the Philippines, Mexico, Kuwait, Israel, the United States, Oman, Kenya, Germany, and Portugal. 

Its private labelling services allows customers to offer peanut butter under their own brand name, while it manages the production, supply and quality control. The Company offers peanut products, consisting of peanut butter and roasted peanuts of which peanut butter is the major contributor towards the revenue from operations. The company offers peanut butter in various packaging form to cater to diverse customer requirements, ranging from sachets (20 grams to 100 grams), jars (100 grams to 1,000 grams) and bulk packaging (1 kilogram to 250 kilograms). The shelf life of peanut butter ranges 12 to 24 months. 

The Company also offers bulk pack options to its customers. NFL offers peanut butter in flavours like chocolate, honey, coconut, cinnamon, pineapple, strawberry, etc of which Chocolate is the major contributor. Further its peanut butter offering range includes natural, creamy, crunchy, less fat, whole nut, high protein and no added sugar & salt. For the reported periods, the company has posted average 97% of private labelling out of which on an average 68% was domestic and the rest was international. As of September 30, 2025, it had 41 employees on its payroll. It also hires contract labour as and when needed.

ISSUE DETAILS/CAPITAL HISTORY:
The company is coming out with its maiden book building route combo IPO of 3384000 equity shares of Rs. 10 to mobilize Rs. 39.59 cr. at the upper cap. The issue opens for subscription on November 26, 2025, and will close on November 28, 2025. The issue comprises of 2707200 fresh equity shares (worth Rs. 31.67 cr. at the upper cap), and an Offer for Sale (OFS) of 676800 equity shares (worth Rs. 7.92 cr. The company has announced a price band of Rs. 111 – Rs. 117 per share. The minimum number of shares to be applied is for 2400 shares and in multiples of 1200 shares thereon, thereafter. Post allotment, shares will be listed on BSE SME. The issue constitutes 27.00% of the post-IPO paid-up capital of the company. From the net proceeds, the company will utilize Rs. 23.19 cr. for capex on new manufacturing unit, and the rest for general corporate purposes. 

The IPO is solely lead managed by Marwadi Chandarana Intermediaries Brokers Pvt. Ltd. Pvt. Ltd., and Bigshare Services Pvt. Ltd., is the registrar to the issue. Mansi Share and Stock Broking Pvt. Ltd. is the market maker. Marwadi Chandarana Intermediaries Brokers and Mansi Share & Stock are syndicate members.

After issuing initial equity shares at par value, the company issued further equity shares at a fixed price of Rs. 180 per share between June 2024, and April 2025. It has also issued bonus shares in the ratio of 1 for 1 in August 2025. The average cost of acquisition of shares by the promoters/selling stakeholders is Rs. 5.00 per share. 

Post-IPO, company’s current paid-up equity capital of Rs. 9.83 cr. will stand enhanced to Rs. 12.54 cr. Based on the upper price band of the IPO, the company is looking for a market cap of Rs. 146.66 cr. 

FINANCIAL PERFORMANCE:
On the financial performance front, for the last three fiscals, the company has posted a total revenue/net profit, of Rs. 76.26 cr. / Rs. 1.13 cr. (FY23), Rs. 81.05 cr. / Rs. 4.77 cr. (FY24), and Rs. 90.48 cr. / Rs. 6.47 cr. (FY25). For H1 of FY26 ended on September 30, 2025, it earned a net profit of Rs. 5.32 cr. on a total revenue of Rs. 50.47 cr. It posted growth in its top and bottom lines for the reported periods. But its higher PAT margins from FY24 onwards raises eyebrows.

For the last three fiscals, the company has reported an average EPS of Rs. 5.61 and an average RoNW of 31.76%. The issue is priced at a P/BV of 3.79 based on its NAV of Rs. 30.91 as of September 30, 2025, but its post-IPO NAV data is missing from offer documents.

If we attribute FY26 annualized super earnings on post-IPO fully diluted equity capital, then the asking price is at a P/E of 13.80. Based on FY25 earnings, the P/E stands at 22.67. The issue relatively appears fully priced. 

For the reported periods, the company has posted PAT margins of 1.49% (FY23), 5.90% (FY24), 7.17%, (FY25), 10.58% (H1-FY26), and RoCE margins of 8.30%, 21.87%, 20.66%, 12.09%, respectively for the referred periods. 

DIVIDEND POLICY:
The company has not paid any dividends for the reported periods of the offer document. It will adopt a prudent dividend policy post listing, based on its financial performance and future prospects. 

COMPARISION WITH LISTED PEERS:
As per the offer document, the company has no listed peers to compare with.

MERCHANT BANKER’S TRACK RECORD:
This is the 6th mandate from Marwadi Chandarana in the last two fiscals.  From the last 5 listings so far, 2 listed at par and the rest with a premium ranging from 0.7% to 90.00% on the listing date.