Dabur will become the king! A bang entry in the spice market of 25 thousand crores, what will be the effect on the stock? Learn

New Delhi. Who is not familiar with the name of Dabur? Dabur is one of the biggest brands in India. Dabur India has announced to buy 51 per cent stake in Badshah Masala. For this the company is going to invest Rs.587.52 crore.

Both the companies (Dabur and Badshah Masala) said in a joint statement that Dabur has signed a definitive agreement to acquire 51 per cent stake in Badshah Masala Pvt Ltd. According to the information so far, this deal will be completed before 31 March 2023. This acquisition is subject to the terms and conditions.

Dabur India’s stock, which has been under pressure since August, rose on Thursday. On the National Stock Exchange, this stock opened with a rise of about 1.5 percent and made a high of Rs 548 in intraday. Although the stock was trading below its opening price (541.5) till 10.27 am. Since, this deal has just been announced, there has not been much impact in the stock market. With the passage of time, the increase in the profit of the company will also affect its stock.

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The results disappointed investors
Dabur India on Wednesday released its second quarter results, which left investors unhappy. According to the results, consolidated profits have registered a decline of 2.85 per cent year-on-year. The company’s profit in the September quarter has been 490.86 crores. At the same time, in the same quarter last year, the company had made a profit of Rs 505.31 crore. However, the company’s revenue has increased by 6 per cent from the operation and has gone up to Rs 2,986.49 crore. In the same period last year, this figure was Rs 2,817.58 crore.

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Expansion plan in food business
Dabur India is now mainly working on a plan to expand its food business. This acquisition has also been done with the intention of entering a new category of the food sector. The company wants to increase its food business to Rs 500 crore in the coming 3 years. With the completion of this acquisition, Dabur India will enter the spice market of Rs 25,000 crore (estimated).

According to a report by Avendus Capital, the spices market in India is worth Rs 70,000 crore, in which branded spices account for only 35 percent. A paper released by this investment bank last year estimated that the market for branded spices would double in size to Rs 50,000 crore by 2025. Avendus estimates that by FY30, 15 spice companies are projected to have over Rs 1,000 crore in revenue, and out of this, 4 companies will achieve Rs 5,000 crore in annual turnover.

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