To boost its production capacity, Pakistan’s largest cooking oil maker – Dalda Foods Ltd – is planning an initial public offering (IPO) in the country, Bloomberg reported on Monday.
Dalda Foods wants to raise between 3.3 billion ($14 million) and 4.6 billion rupees from the share sale, expected before Ramadan, which is expected to start on March 22, the company’s chief executive officer Aziz Jindani said. American publication.
Dalda’s Rs 4.6 billion IPO will be Pakistan’s largest IPO, according to data compiled by Bloomberg. It will also be the country’s largest after Airlink Communications Ltd’s Rs 6.4 billion listing in September 2021.
Referring to the company’s factory at one of the country’s busiest shipping ports, Jindani said: “The purpose of this particular IPO is to fund the expansion of Port Qasim. The proceeds will be from seeds in Karachi. May increase oil extraction capacity.
It could reach 900 tonnes per day, double the current rate, he added.
Meanwhile, Arif Habib Limited (AHL) Chief Executive Officer Shahid Ali Habib revealed that the offer could involve the sale of around 50 million shares, with two-thirds of new shares and the rest to existing shareholders. are of It should be noted that Arif Habib Limited is the sole advisor to the IPO.
Unilever introduced Dalda to the region in 1937, however, it sold the company’s Pakistan business to the Westberry Group, owned by Bashir Jan Muhammad and a group of employees. Over time, Dalda expanded into liquid tea whitener in addition to cooking oil, according to its website.
Jindani said the business as a category is “recession-proof”, as Pakistanis continue to spend on cooking oil despite high inflation and slowing economic growth as it is a household necessity. is seen.
The CEO said that since 2018, the company’s revenue has grown at an average of 27 percent annually. Revenues in the 2021-22 financial year reached Rs 88 billion, which is higher than other major food producers in the country such as Friesland Campina, Engro Pakistan Limited. , and National Foods Ltd., added the executive.
Moreover, it was found that Dalda’s products account for about 5 percent of the cooking oil market, which is worth about $8 billion. The listing could further help Dalda capture a larger share of Pakistan’s fragmented edible oil market.
