Vandan Foods IPO

The company claims that its products are used across a range of industries, including cosmetics, pharmaceuticals, lubricants, paints, and textiles.

The company claims that its business model is diversified, with offerings that include castor de-oiled cake, castor seeds, and castor oil. The company further states that this revenue mix helps maintain consistent demand for the products in the market.

The company claims that it operates a scalable and customer-focused model. This model is driven by orders and emphasises efficient use of resources, consistent product quality, and cost benefits through economies of scale.

The company claims to have built and maintained long-term relationships with its key customers, resulting in a strong and stable client base.

The company is ISO 9001:2015 certified for quality management systems.

Over the years, the company has observed a consistent increase in its revenue from operations. It increased from Rs 1.47 crore in FY22 to Rs 11.59 crore in FY23 to Rs 48.73 crore in FY24.

The top three customers accounted for Rs 23.42 crore (32.24 percent) of the company’s total revenue in the period ended December 31, 2024, Rs 9.82 crore (20.16 percent) in FY24, Rs 5.64 crore (48.66 percent) in FY23, and Rs 1.47 crore (100 percent) in FY22, Furthermore, the top customer accounted for Rs 10.43 crore (14.35 percent) of the company’s revenue in the period ended December 31, 2024, Rs 3.84 crore (7.89 percent) in FY24, Rs 3.22 crore (27.78 percent) in FY23, and Rs 0.96 crore (65.03 percent) in FY22. Any loss of even one of these clients or a failure to retain them or expand the customer base can adversely impact the company’s operations and finances.

The top three suppliers accounted for Rs 33.60 crore (46.21 percent) of the company’s purchases in the period ended December 31, 2024, Rs 13.93 crore (31.04 percent) in FY24, and Rs 8.42 crore (93.58 percent) in FY23. Furthermore, the top supplier alone accounted for Rs 16.15 crore (22.21 percent) in the period ended December 31, 2024, Rs 5.27 crore (11.74 percent) in FY24, and Rs 5.30 crore (58.83 percent) in FY23. Any disruption in supplies from one or more of these suppliers could adversely affect the company’s business operations.

A significant portion of the company’s revenue is derived from Gujarat. It accounted for 92.62 percent of the company’s revenue in the period ended December 31, 2024, 87.63 percent in FY24, 93.53 percent in FY23, and 80.70 percent in FY22. Any adverse social, political, or economic developments in this region can negatively affect the company’s business and finances.

The company reported negative cash flows from operating activities amounting to Rs 10.77 crore in the period ended December 31, 2024. Additionally, negative cash flow from investing activities amounted to Rs 3.40 crore in the period ended December 2024 and Rs 5.36 crore in FY24. Furthermore, the company reported negative cash flow from financing activities amounting to Rs 1.48 crore in FY23 and Rs 0.25 crore in FY22. If cash outflows continue to exceed inflows, the company may face liquidity challenges in the future.

The company’s business is subject to seasonal volatility, largely driven by the availability of castor seeds, a major raw material in its manufacturing operations. The availability of castor seeds varies by season, with higher revenues typically occurring during the crop season when the raw material is abundant and priced reasonably. Any inability to address this fluctuation in demand could adversely affect its business and financial condition.

The company, its directors, and promoters are involved in certain legal proceedings. Any adverse judgments in any of these cases can be detrimental to the company’s business prospects.

The company’s operations rely on a single manufacturing facility in Gujarat. Any sudden equipment failures or accidents in the facility or natural disasters in or around the region can adversely affect the company’s production capabilities.

As of December 31, 2024, the company had outstanding financial indebtedness of Rs 13.89 crore. Any failure to service or repay these loans can harm the company’s operations and financial position.