| IPO Details | Uma Exports IPO GMP | Allotment Status |
Uma Exports IPO is all set to open for subscription on 24 March 2022. The company is among the largest FMCG players in the Indian edible oil sector. Uma Exports IPO review is aimed to bringing readers up to the speed with regards to the company’s business, strengths and valuation.
Uma Exports IPO Review – Strengths
- Strong presence in agro commodities trading segment
- Experienced management team with proven project management and implementation skills
- Established track record of growth and profitability
- Long-term relationship with clients and repeat business
Uma Exports IPO – Risk Factors
- Constantly changing economic, regulatory, social and political conditions in overseas markets
- Export / import of certain agricultural produce and commodities is subject to seasonal factors
- Changes in Open General License (OGL) policy could materially affect operations and financial results
- insurance coverage may be inadequate to protect it against certain operating risks
Uma Exports IPO Analysis – Financial Performance
| Â | FY2019 | FY2020 | FY2021 | H1 FY2022 |
| Revenue | 329.4 | 810.3 | 752.0 | 523.9 |
| Expenses | 325.6 | 799.4 | 735.5 | 511.7 |
| Net income | 2.9 | 8.3 | 12.2 | 9.0 |
| Margin (%) | 0.9 | 1.0 | 1.6 | 1.7 |
Uma Exports Valuations & Margins
| FY2019 | FY2020 | FY2021 | |
| EPS | 1.02 | 3.30 | 4.92 |
| PE ratio | – | – | 13.21 – 13.82 |
| RONW (%) | 5.27 | 14.33 | 17.67 |
| ROCE (%) | – | 32.22 | 28.89 |
| EBITDA (%) | – | 2.44 | 2.83 |
| Debt/Equity | – | 0.31 | 0.61 |
| NAV | 19.41 | 23.03 | 27.83 |
Uma Exports IPO Review – Subscribe or Avoid?
Uma Exports was incorporated in 1988 and was initially involved in exports of building materials such as marble, granite, marble chips and similar materials to Bangladesh. Later, the company realized the huge trade gap in Agri products trade between these countries. So, Uma Exports diversified into agricultural produces and commodities exports in 1997. Since then, the company is engaged in the business of import export of Agri products and commodities.
Uma Exports is engaged in trading and marketing of Agri produces and commodities; such as Sugar, a variety of spices, food grains and oils. In the spices category it produces and exports dry red chillies, turmeric, coriander, cumin seeds, etc. Also, in the food grains segment, it deals in rice, wheat, corn, sorghum, tea and pulses. The company is engaged with B2B (Business to Business) traders and works in a strategical manner. Uma Exports manages the stocks of these commodities in bulk quantities and distributes them to different institutional parties. Uma Exports distributes these products to manufacturers, exporters, and retailers as well.
The company is highly specialized in Sugar, Corn and Dal and does not just export these commodities but import as well. Uma exports, imports Lentils, Faba Beans, Black Urad Dal and Tur Dal. The import trades are commonly done with Canada, Australia and Burma. After the imports, it distributes these commodities to domestic institutions in bulk quantities.
Uma Exports has its presence in overseas markets as well and owns a 100% stake in U.E.L. International FZE which is mainly engaged in Sugar, Spices and Textile trades. The company was incorporated under the United Arab Emirates company law.
Pandemic and War conflict impacts
During Covid-19 pandemic, the company was not much affected by shutdowns. Because the company is engaged in the import exports and trading of Agri products and commodities. These goods are known as essential goods. They have not shut down their operations during the pandemic. However, Uma Exports suffered from the limited availability of labour, logistics and supply chain constraints.
As we know Russian President Vladimir Putin announced military operation in Ukraine which is impacting import export sector. Uma Exports imports goods from Canada. Also, it exports spices, wheat and rice to other countries. Russia and Ukraine are among the biggest wheat exporters in the world. Due to the military operations, the shortage of wheat and edible oil increases day by day. The company might take advantage of the situation.
Financials at a glance
Uma Exports’ consolidated revenues grew at a CAGR of 51.1% from 2019 to 2021:
2021 – INR 752 crores
2020 – INR 810.3 crores
2019 – INR 329.4 crores
The company’s EBITDA at consolidated basis grew at a CAGR of 52.76% from 2019 to 2021:
2021 – INR 21 crores
2020 – INR 20 crores
2019 – INR 9 crores
Also, the Profit After Tax grew at a CAGR of 105.45% on consolidates basis from 2019 to 2021:
2021 – INR 12.2 crores
2020 – INR 8.3 crores
2019 – INR 2.88 crores
Country wise breakdown of exports:
Shri-Lanka – 36.6%
Afghanistan – 32%
Bangladesh – 16.06%
China – 9%
Promoters and management
Madan Mohan Khemuka is the Non-Executive and Non-Independent Director of the company. He holds the directorships in Uma Agro Exports Limited, Agrocomm Trading Company Private Limited and Primerose Dealers Private Limited. Rakesh Khemka is the Managing Director of the company. He was appointed in 1994 and has experience of 28 years across various management roles. He also holds the directorship of Uma Exports Limited and Agrocomm Trading Company Private Limited.
Manmohan Saraf is an Executive Director and CFO of the company. He cleared the final examination of the Institute of Chartered Accountants in 2003. He got their certification of Practice in 2008 and has been an international auditor for the past ten years.
Capital Structure of Uma Exports
| No | Name Of the Share holder | Pre-issue Equity Share Capital (%) |
| 1 | Rakesh Khemka | 31.97 |
| 2 | Sweta Khemka | 13.76 |
| 3 | Primerose Dealers Privat Limited | 13.73 |
| 4 | Madan Mohan Khemuka as Karta of Madan Mohan Khemuka & Sons | 11.29 |
| 5 | Sumitra Devi Khemuka | 10.31 |
| 6 | Madan Mohan Khemuka | 5.66 |
| 7 | Rakesh Kumar Khemka as Karta of Rakesh Kumar Khemka | 7.57 |
| 8 | Uma Agro Exports Private Limited | 2.48 |
| 9 | Agrocomm Trading Company Private Limited | 1.12 |
Uma Exports IPO Review – Conclusion
Looking at the financial and operational aspects, there is little we can pinpoint in terms of weakness in its business model. Nevertheless, the company operates in a tough business environment underlined by slim margins and Uma Exports is no exception here. There is also little in terms of scope to boost its margins as the core business is of sourcing and trading with limited value addition or branding.
This leaves us with historical performance and valuations as key metrics. Uma Exports scores well in both these departments with robust financial performance and operational parameters. Overall, Uma Exports IPO analysis tells us that this commoditized but long-runway business is priced attractively for the moderate growth it offers. If someone is looking to double investment on listing, this may not be the best bet.
Uma Exports IPO Review – Broker Calls
Angel One –
Arihant Capital –
Ashika Research –
Asit C Mehta –
BP Wealth –
Canara Bank Securities – Avoid
Choice Broking – Avoid
Elite Wealth –
GEPL Capital –
Hem Securities – Avoid
ICICIdirect –
KR Choksey –
Marwadi Financial Services –
Motilal Oswal –
Nirmal Bang –
Religare Broking –
Samco Securities –
Share India Securities –
SMC Global –
Systematix –
Ventura Securities – Not Rated
