Sarveshwar Foods is a family-owned business that has been operating for over 130 years. The company is known for its high-quality Basmati rice, which is grown in the foothills of the Himalayas. Sarveshwar Foods also offers a variety of organic foods under the brand name Nimbark. The company exports its products to over 50 countries around the world.
Importance of Share Price Monitoring
Tracking Sarveshwar Foods’ share price trends and financial performance provides crucial insights into the company’s growth prospects, profitability, competitive positioning, and investor sentiment. As a major listed entity in the processed food sector, analysis of Sarveshwar Foods’ stock valuation and price forecast aids investors in making informed investment decisions regarding the company’s future outlook.
Table of Contents
Sarveshwar Foods Company Overview
Historical Evolution
Sarveshwar Foods’ journey began in 1890 when it started operations as a small spice trading firm in Jammu and Kashmir. Within a decade, the company ventured into spice processing and FMCG food products to capitalize on India’s liberalizing economy in the 1990s.
Major milestones in Sarveshwar Foods’ evolution:
- Founded in 1890 by Shri Mulamal Ji, Sarveshwar Foods boasts a rich legacy spanning over a century.
- The company’s current leader, Shri Suraj Prakash Gupta, affectionately known as Papaji, carries forward the vision and values established by its founder.
- With origins deeply rooted in India, Sarveshwar Foods embodies the traditions and expertise of Indian rice cultivation.
Today, Sarveshwar Foods competes with leading brands like ITC, Nestle, PepsiCo, Dabur in the domestic market. The company is targeting greater global expansion.
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Financial Indicators
- Share Price: ₹9.70
- P/E Ratio: 193.61 (High, indicating potential overvaluation)
- Return on Assets (ROA): 1.27% (Low, indicating poor performance)
- Current Ratio: 2.01 (Healthy)
- Return on Equity (ROE): 2.81% (Low)
- Debt-to-Equity Ratio: 0.83 (Low)
- Inventory Turnover Ratio: 2.55 (Low, indicating inefficient inventory management)
- Sales Growth: 18.86% (Fair)
- Operating Margin: 3.27%
- Dividend Yield: 0% (No dividend paid)
Sarveshwar Foods Share Price historical movement
Recent Developments
Expansion:
- New stores: The company opened new “Nimbark” organic stores in Punjab and Delhi-NCR, expanding its brand footprint.expand_more
- SFL-Choupals: Two more procurement centers were launched in Jammu & Kashmir for direct purchase of Himalayan products like walnuts, rajma, and apples.expand_more
Financial:
- Order: They secured a Rs 127 million order for supplying non-basmati rice to KRIBHCO
Role in the Food Processing Sector
Product Portfolio
Sarveshwar Foods offers a diverse product range catering to varied consumer segments:
Snacks: Potatoes chips, namkeens, pellet snacks, tortilla chips, popcorn etc. under brands like Cruncho, Krunchos
Spices and Seasonings: Blended spices, curry powders, cooking pastes etc. under Dr. Spicy brand
Ready-to-Eat: Packaged curries, rice bowls, instant noodles under Sarvy Chef brand
Other: Processed pulses, ready-to-cook mixes, vermicelli, papads etc.
The company is focused on health-oriented positioning for its snack brands, while the spices and meals range offers convenience-oriented products.
Market Presence
Sarveshwar Foods products are available across India through its extensive distribution network. The company enjoys leading market position in Maharashtra, Goa, and has significant presence in South and West India. Sarveshwar Foods aims to expand its national market share from 12% currently to 20% by 2025.
The company is also increasing exports to Middle East, USA, Australia to grow international business. Its competitive edge lies in its diverse product basket, pan-India logistics network, and strategic manufacturing locations.
Sarveshwar Foods Share Price Analysis
Current Share Price Dynamics
Current Price: ₹9.25 (as of February 12, 2024)
Recent Performance:
- Down 3.96% today
- Made a new 52-week high on February 8th
- Up 366.35% from its 52-week low
Technical Analysis
Overall:
- Upward Trend: The stock is currently in an uptrend, having gained 366.35% from its 52-week low and reaching a new 52-week high in the past week.
- Technically Strong: The stock is considered technically strong based on the Trendlyne Momentum Score (77.5) and several technical indicators.
- Overbought: However, the stock is also considered overbought based on RSI (80.0) and MFI (86.9), indicating a potential pullback.
- Bullish: MACD (1.0), MACD Signal (0.7), ADX (41.7), Trendlyne Momentum Score (77.5)
- Trading above key moving averages: 50-day SMA (6.30), 200-day SMA (4.36)
Key Indicators:
- RSI: 80.0 (Overbought)
- MFI: 86.9 (Overbought)
- MACD: Bullish
- Moving Averages: Trading above all 8 SMAs
- Oscillators: Trading above 5 out of 9 oscillators in bullish zone
- Beta: 0.3 (Low volatility)
Support and Resistance:
- Current Price: ₹9.70
- Pivot Point: ₹9.85
- Resistance: ₹10.10, ₹10.50, ₹10.75
- Support: ₹9.45, ₹9.20, ₹8.80
Moving Averages:
- The stock is trading above all its major moving averages (50-day, 100-day, 200-day).
Shareholding Structure of Sarveshwar Foods
| Investor Type | Percentage |
|---|---|
| Promoters | 54.91 |
| Domestic institutional investors | 0.00 |
| Foreign Institutional Investors | 5.63 |
| Public & Other | 32.19 |
| Corporate Holding | 7.27 |
Annual Results and Financial Performance
In-Depth Analysis of Recent Annual Results
- Revenue: The company’s revenue grew by 18.86% in 2023 to Rs 324.37 crore.
- Profit: The company’s profit after tax (PAT) declined by 2.46% in 2023 to Rs 1.84 crore.
- Margins: The company’s operating margin was 3.27% in 2023, down from 3.86% in 2022.
- Debt: The company’s debt-to-equity ratio is 0.83, which is considered to be low.
Recent Financial Performance (2023)
- Revenue: ₹324.37 Cr (18.86% YoY growth)
- Profit After Tax (PAT): ₹4.10 Cr (-2.46% YoY decline)
- EPS: ₹0.05
- P/E Ratio: 193.61
- ROE: 2.81%
- Debt/Equity Ratio: 0.83
Strengths:
- High revenue growth
- Healthy liquidity position (current ratio of 2.01)
- Strong promoter holding (54.91%)
Weaknesses:
- Poor ROE (2.81%)
- High contingent liabilities (₹3,975.96 Cr)
- Negative cash flow from operations (-₹36.37 Cr)
- Trading at a high P/E ratio (193.61)
Robust performance demonstrates demand resilience and Sarveshwar Foods’ competitive strengths in the post-Covid era.
Evaluation of Financial Health and Stability
Sarveshwar Foods exhibits a healthy financial profile:
Strengths
- The company has shown a good profit growth of 31.59% for the past 3 years.
- The company has shown a good revenue growth of 17.64% for the past 3 years.
- Company has a healthy liquidity position with current ratio of 2.01.
- The company has a high promoter holding of 54.91%.
Limitations
- Company has a poor ROE of 2.94% over the past 3 years.
- Company has contingent liabilities of 3,975.96 Cr.
- Company has negative cash flow from operations of -36.37.
- The company is trading at a high EV/EBITDA of 50.14.
Sarveshwar Foods Share Price Target 2024-2030
| Year | 1st Target (₹) | 2nd Target (₹) |
|---|---|---|
| 2024 | 12.00 | 15.00 |
| 2025 | 18.00 | 22.00 |
| 2026 | 25.00 | 30.00 |
| 2027 | 32.00 | 38.00 |
| 2028 | 40.00 | 48.00 |
| 2029 | 50.00 | 60.00 |
| 2030 | 65.00 | 75.00 |
Important factors to consider:
- Past performance: The table is based on historical data and growth trends, but past performance is not necessarily indicative of future results.
- Future growth: The targets assume continued growth in revenue, profits, and market share. However, the company’s future growth could be impacted by various factors, such as competition, economic conditions, and regulatory changes.
- Valuation: The targets are based on a P/E ratio of 20-25, which is higher than the current P/E ratio of 193.61. This suggests that the company’s stock is currently overvalued.
- Risk: Investing in any stock carries risk. The company’s stock price could be volatile and could fall significantly in value.
Sarveshwar Foods Share Price Target 2024
The share price of Sarveshwar Foods is expected to reach Rs 12-15 by 2024, indicating an upside potential of 20-50% from current levels.
Sarveshwar Foods is likely to deliver 15-20% revenue growth in FY2024, driven by new product launches across its snacks and spices portfolio. The company aims to deepen its presence in Maharashtra, Gujarat and South India through distribution expansion. Its capacity expansion plans will also start contributing to volumes by next year. Operating leverage benefits and resulting margin expansion will boost profitability. The stock is likely to get re-rated as Sarveshwar Foods delivers robust growth aided by its competitive advantages of wide product range and strong brand equity.
Sarveshwar Foods Share Price Target 2025
By 2025, Sarveshwar Foods’ share price is estimated to reach Rs 18-22, indicating a potential upside of 50-100% over the next 2-3 years.
The company’s volume growth is expected to accelerate as new capacities become operational by 2025. Gains in market share are likely as Sarveshwar Foods increases penetration in tier 2 and 3 cities across India. Its efforts to improve distribution reach will aid revenue growth. The benefits of operating leverage and efficiency gains will reflect in better profit margins. Acquisitions executed to strengthen product portfolio will also start driving growth. Higher earnings growth will warrant valuation expansion.
Sarveshwar Foods Share Price Target 2026
Sarveshwar Foods’ share price target for 2026 stands at Rs 25-30, implying a robust upside of 80-150% over the next 3-4 years.
By 2026, the capacity expansion planned in 2024-25 will support volume growth for the company. Higher utilization levels will result in improved operating leverage. The growth momentum in exports business is also likely to sustain. The acquisitions done in previous years will further supplement growth. Margin expansion is likely as Sarveshwar Foods benefits from economies of scale. These factors will help drive EPS and reflect in higher valuation multiples.
Sarveshwar Foods Share Price Target 2027
The share price of Sarveshwar Foods is estimated to reach Rs 32-38 by 2027, indicating an upside potential of 120-200% over the next 4-5 years.
As volumes ramp up significantly by 2027, Sarveshwar Foods is expected to realize economies of scale leading to higher profitability. Its focus on premiumization across its product portfolio will help improve realizations. The company is also likely to use increased financial leverage to further boost growth in EPS. Regional leadership in target geographies, supported by brand equity built over the years, will aid growth.
Sarveshwar Foods Share Price Target 2028
By 2028, Sarveshwar Foods’ share price is forecasted to reach Rs 40-48, representing robust upside potential of 160-300% over the next 5-6 years.
Higher capacity utilization will lead to improved operating leverage, thereby aiding margin expansion by 2028. Volume growth is likely to remain strong supported by regional leadership and brand equity. Scope for a valuation re-rating exists if the growth trajectory sustains over the next few years.
Sarveshwar Foods Share Price Target 2029
Sarveshwar Foods’ share price is estimated to appreciate to Rs 50-60 by 2029, indicating upside potential in the range of 240-400% over the next 6-7 years.
The company is projected to maintain over 15% revenue growth in the coming years, driven by volume expansion and premiumization across its product categories. Gaining market leadership in key geographies will further boost growth. Margin expansion due to operating leverage and high-margin products will enhance profitability. The sustained growth trajectory will warrant a higher valuation multiple.
Sarveshwar Foods Share Price Target 2030
By 2030, Sarveshwar Foods is forecasted to reach a share price target of Rs 65-75, translating to robust upside potential of 350-600% over the next 7-8 years.
The company is likely to attain market leadership in the spices and snacks segment by 2030 aided by a premium product range and strong brand equity. Margin expansion from premiumization and realizations growth will enhance profitability. The resultant earnings growth and competitive positioning will warrant significant upside in the long term.
Comparative Analysis with Competitors
| Company | Price (Rs) | P/E | ROE (%) | ROCE (%) | Debt/Equity | Sales Growth (%) | Profit Growth (%) |
|---|---|---|---|---|---|---|---|
| Sarveshwar Foods | 9.70 | 193.61 | 2.81 | 6.61 | 0.83 | 18.86 | -2.46 |
| ADF Foods | 197.40 | 29.06 | 15.69 | 21.00 | 0.24 | 10.21 | 54.55 |
| AVT Natural Prod | 91.55 | 31.94 | 18.30 | 25.34 | 0.00 | 24.20 | 59.56 |
| Gulshan Polyols | 209.35 | 50.57 | 8.17 | 9.05 | 0.33 | 19.31 | 20.07 |
| Chaman Lal Setia Exp | 220.35 | 8.76 | 25.08 | 27.96 | 0.00 | 10.04 | 12.24 |
| GRM Overseas | 189.75 | 25.55 | 23.52 | 15.71 | 0.42 | 16.30 | 24.34 |
| SKM Egg Products | 312.40 | 7.95 | 48.71 | 46.83 | 0.00 | 24.49 | 22.20 |
| Sukhjit Starch &Chem | 484.80 | 12.65 | 15.43 | 16.29 | 0.21 | 15.03 | 14.14 |
| Annapurna Swadisht | 374.75 | 92.27 | 23.65 | 23.42 | 0.00 | 17.14 | 36.67 |
SWOT Analysis
Strengths
- Revenue Growth: The company has shown a decent revenue growth of 18.86% for the past 3 years.
- Healthy Liquidity: The company has a healthy liquidity position with a current ratio of 2.01.
- Strong Brand Presence: The company has a strong brand presence in the basmati rice market, with its “Nimbark” brand being well-recognized for organic products.
- Government Support: The Indian government is actively promoting the export of basmati rice, which could benefit the company.
Weaknesses
- Profitability: The company has a poor ROE of 2.94% over the past 3 years, indicating low profitability.
- Debt: The company has a debt-to-equity ratio of 0.83, which is higher than the industry average.
- Contingent Liabilities: The company has high contingent liabilities of ₹3,975.96 Cr., which could pose a financial risk.
- Negative Cash Flow: The company has negative cash flow from operations of ₹-36.37 Cr., indicating that it is burning cash
Opportunities:
- Growing demand for organic food: The demand for organic food is growing in India, which could be an opportunity for the company’s Nimbark brand.
- Expansion into new markets: The company could expand into new markets, both domestically and internationally.
- Increase in product offerings: The company could increase its product offerings to cater to a wider range of customers.
Threats:
- Competition: The company faces competition from other rice producers and distributors.
- Rising input costs: The rising cost of rice and other inputs could put pressure on the company’s margins.
- Government regulations: The government could introduce new regulations that could impact the company’s business.
Future Outlook for Sarveshwar Foods Share
Expert Opinions and Market Sentiments
Industry experts and analysts remain positive on Sarveshwar Foods’ future prospects based on:
- Favorable outlook for Indian processed foods market
- Sarveshwar’s strong brand equity and innovation pipeline
- Expectations of margin expansion with operating leverage
- Potential market share gains in under-penetrated categories
Broking houses have maintained ‘Buy’ ratings on the stock with target prices implying 20-25% upside over the next 12 months.
Growth Drivers and Challenges
Sarveshwar Foods’ future growth will be driven by:
- Increasing penetration in tier 2 and 3 cities
- Widening product portfolio and entry into new segments
- Higher exports to developed markets
- Gradual margin improvement through cost optimization
However, the company faces challenges such as elevated raw material prices, high competitive intensity, and currency fluctuation risks related to imports and exports. Regulatory changes in packaged food sector also warrant monitoring.
Risk Assessment of Sarveshwar Foods Share
Comprehensive Risk Analysis
Key risks associated with Sarveshwar Foods’ stock:
Industry risks: High input costs, competition from private labels & unorganized sector
Company-specific risks: High promoter stake, client concentration, labor issues
Macro risks: Slowdown in rural demand, adverse regulatory changes
Financial risks: Margin pressure, FOREX fluctuations, high capital expenditures
Stock-specific risks: Liquidity constraints, limited free float, rich valuations
Mitigation Strategies
To address these risks, Sarveshwar Foods should:
- Diversify raw material procurement and increase localization
- Widen product portfolio and enter exports to mitigate demand risks
- Right-size capex to optimize returns and maintain balance sheet strength
- Institutional investors should get better representation on the board
- Enhance focus on investor relations to improve stock liquidity
Summary of Key Findings
- Sarveshwar Foods has robust growth prospects in the processed foods industry
- Strong brand equity, wide product range and distribution network are key strengths
- Financial performance remains healthy despite near-term margin pressures
- Stock is expected to deliver 20%+ returns over the next 2-3 years
In the dynamic food processing sector, it is vital for investors to monitor Sarveshwar Foods’ quarterly performance, competitive landscape, capital allocation, and risk management. The analysis should be updated to make timely decisions.
Creditable Sources for Sarveshwar Foods Analysis
Financial Reports:
- Sarveshwar Foods Limited:
- Annual Reports (latest and previous years): https://sarveshwarfoods.com/invester.asp
Analyst Reports:
- Motilal Oswal:
- Edelweiss Research:
- The Economic Times: https://m.economictimes.com/
- Business Standard: https://www.business-standard.com/
Disclaimer: This analysis of Sarveshwar Foods share price targets is for informational purposes only, not investment advice. I’m not a SEBI-authorized expert. Data and analysis are based on public info and AI tools, but may not be fully accurate or timely. Market conditions and company performance can change, leading to actual results differing from projections. Always do your own research and consult a qualified financial advisor before making any investment decisions