BENGALURU, Sept 22: DSM Fresh Food Limited, operating under the brand name Zappfresh, is all set to launch its Initial Public Offering (IPO) on September 26, with a price band of Rs 96 to Rs 101 per equity share of face value Rs. 10 each.
Ahead of the listing, company management discussed the rationale behind the pricing, its competitive advantages, and growth strategies in an interaction with the media.
The IPO comprises up to 59,06,400 equity shares, of which 3,31,200 shares will be reserved for market makers. The net issue of 55,75,200 shares, aggregating up to Rs. 56.31 crore, will be offered to investors through the book-building process.
Retail individual investors, qualified institutional buyers (QIBs), and non-institutional investors will be able to apply via the Application Supported by Blocked Amount (ASBA) process.
Reply to an UNI query on the valuation of the IPO, Deepanshu Manchanda, Chairman and Managing Director, DSM Freshfoods, told reporters that the price band is intended to provide value both to customers and investors.
“Our valuation is very reasonable and is aimed at attracting a larger investor base while allowing them potential gains. Compared to competitors, many of whom are unicorns, we are focused on the SME space, which is the backbone of the country. The pricing is designed to resonate with individual investors rather than just global investors,” he said.
Regarding the utilization of IPO proceeds, Manchanda highlighted the importance of brand building and working capital.
“As we build a strong brand like any FMCG company, investment in marketing and awareness campaigns is critical. On the working capital front, our offline business is growing and will require substantial resources. Both these uses are key to our growth strategy,” he explained.
Founded in 2015, Zappfresh is an omnichannel retailer of fresh meat, including chicken, mutton, and seafood, catering to both B2C and B2B segments. The company operates on an integrated supply chain model covering sourcing, processing, cold storage, and distribution, ensuring high-quality, hygienic meat for retail consumers and HoReCa (hotel, restaurant, catering) partners.
On business segmentation, Manchanda noted that the company operates across both B2C (online) and B2B (offline) channels. Last year, the online segment contributed 70% of revenue, while offline accounted for 30%. This year, they aim for a near 50-50 balance, citing the offline market as the “lion’s share” and a key growth area.
The company has earmarked Rs. 23 crore from the IPO proceeds for inorganic growth, including acquisitions and partnerships. Manchanda said they are in advanced stages of evaluating target companies to create synergistic value and accelerate growth. The net proceeds from the IPO will also fund working capital requirements of Rs. 25 crore, marketing expenditure of Rs. 15 crore, capital expenditure of Rs. 11 crore, and general corporate purposes.
On competitive differentiation, Manchanda emphasised Zappfresh’s focus on quality, standardisation, and accountability, which distinguishes it from traditional butchers.
He highlighted missing elements in the traditional market such as cold chain logistics, proper packaging, standardised pricing, and responsibility.
In comparison with e-grocery platforms, Zappfresh aims to offer greater value through competitive pricing without hidden charges like platform or packaging fees. “Value for money is central to our proposition,” Manchanda added.
The IPO will allow investors to participate in the growth of a company that is transforming India’s highly fragmented meat retail sector through an integrated supply chain, covering sourcing, processing, cold storage, and distribution.
Narnolia Financial Services Limited is acting as the Book Running Lead Manager to the offer, and the equity shares are proposed to be listed on the SME platform of BSE (BSESME).
(UNI)
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