Colombo, 26th July 2024: Maharaja Foods Limited, a renowned manufacturer and exporter of authentic Sri Lankan food and spices, proudly announces commencing secondary market trading at the CSE today. The Initial Public Offering (IPO) opened on 4th July for general investing public, however closed on the opening day itself due to oversubscription. The triumphant completion of its IPO marks a significant milestone for the company.
Targeting a capital raise of LKR 125mn, the IPO attracted overwhelming interest, receiving 662 applications totaling LKR 322 million, which is nearly three times the initial target.
The secondary market’s performance is tipped to demonstrate strong investor confidence, especially from non-retail investors who received only 31% of the shares due to oversubscription. The IPO also attracted large applications from well-known strategic high net worth investors, who secured positions within the top 10 list of shareholders of MFPE. Furthermore, the IPO attracted applications from Licensed Market Intermediaries under the Category of Unit Trusts and Investment Managers.
MFPE has already commenced execution of IPO objectives as described in the Prospectus.
The Raw Rice plant with a capacity of 10 metric tons per day, and the Rice Polishing Plant with a capacity of 2000–5000kgs per hour are expected to bolster production efficiency and profitability. Managing Director Vithyanath Guganathan noted, “Advance payments have already been made for the rice polishing plant and raw rice plant. We anticipate receiving these plants by mid-August and commencing production immediately aster commissioning.”
Gingelly Oil Plant: The machinery for this new product line has been acquired and installed, with production already begun. The first shipment has already been completed, marking significant progress in reducing production costs and meeting rising consumer demand for gingerly oil.
A portion of capital raised from IPO proceeds has been earmarked to enhance working capital, ensuring smooth operations and enabling cost-effective bulk purchases of raw materials. This allocation of IPO funds supports the company’s strategy to source paddy directly from farmers, stabilizing costs.
Warehouse Expansion: To support the increased production capacity, an expansion of the warehouse facilities is planned via IPO funds, enhancing storage capacity for raw materials and finished products. Construction is scheduled to commence in August 2024.
Executive Non-independent Director Thavamalar Guganathan commented, “The overwhelming response to our IPO is a testament to the confidence capital market investors have placed in Maharaja Foods. We are committed to leveraging this support to achieve our growth objectives and enhance shareholder value.”
Chairman Vijayanath Guganathan added, “Our recent listing status has opened new doors for us, including participation in the Export Development Board (EDB) trade show in Australia. This event will showcase our products and establish valuable partnerships, expanding our reach in the Australian market.”
Today, Maharaja Foods is synonymous with quality. The flagship Maharaja Super Supermarket and the expansive range of food products under the Maharaja Food Products brand are household names trusted by thousands of customers not only in Sri Lanka but also overseas. The renowned hand-roasted rice flour remains the crown jewel of the product portfolio while a gourmet selection of local spices and unique food ingredients like Maldivian fish chips and Odiyal are also crowd pleasers. This is a reflection of the company’s commitment to nourishing the nation with healthy products that are of superior quality.
The company’s enhanced financial position, coupled with strategic investments, reassures investors of Maharaja Foods’ promising future. Investors are encouraged to remain confident, recognizing the company’s commitment to delivering superior returns and maintaining the highest standards of quality and sustainability.