Shanthala FMCG Products Limited IPO
The business model described here involves a distributorship business that operates through two separate entities:
1. M/s. Shanthala Traders – Prop. B. Manjunath (Proprietorship Firm): This entity was established in 1996 as a proprietorship firm with a commitment to delivering quality products to customers in a timely manner. Initially, it operated independently, distributing various products, including branded packaged foods, personal care products, education and stationery items, matches, agarbatti, and tobacco products. In 2014, Shanthala Traders Private Limited was incorporated, and the entire business of M/s. Shanthala Traders was transferred to the new private limited company. The business of the proprietorship firm was discontinued. The private limited company focuses on providing last-mile connectivity to large consumer product companies, acting as a distributor for their products.
2. M/s. Shanthala Enterprises – Prop. Mrs. Sharada Malya (Proprietorship Firm): This entity continues to exist and operates in a different geographical area, specifically Kushal Nagar. It is also involved in the distribution business, although there seems to be a reference to potential conflicts or issues with this entity, which are detailed in the prospectus.
The business model essentially revolves around acting as a distributor for various Fast Moving Consumer Goods (FMCG) companies in India. The product categories being distributed include branded packaged foods, personal care products, education and stationery items, matches, agarbatti, tobacco products, beauty and well-being products, nutrition products, personal care, home care products, as well as oil, sugar, and atta (flour) sold under the Sunpure brand name by M. K. Agrotech Pvt. Ltd.
The primary market of operation is the district of Coorg, Karnataka, which has been the home for Shanthala and the promoters for over 20 years. This long-standing presence in the area has led to a deep understanding of customer needs, making the business an essential link between large consumer product companies and customers in this region. The difficulty of servicing this scattered customer base creates a barrier to entry for new competitors, reinforcing the distributor’s position.
The reference to the “breakup of revenue from the sale of ITC products” likely indicates that the business also distributes products from ITC Limited, a prominent Indian conglomerate with interests in various sectors, including FMCG.
In summary, this business model involves acting as a distributor for FMCG companies, providing a vital link between these companies and customers in a specific geographic area. The business has evolved from proprietorship firms to a private limited company to enhance its operations and reach.
1. Distributor of Choice
2. Distribution of a variety of Products
3. Experienced Promoter and management team with strong industry expertise and successful track record.
Objects of the Shanthala FMCG Products Limited IPO:
Shanthala FMCG Products Limited IPO Details:
|Open Date:||Oct 27 2023|
|Close Date:||Oct 31 2023|
|Face Value:||₹ 10 Per Equity Share|
|Issue Type:||Fixed Price Issue IPO|
|Issue Size:||16.07 Cr.|
|Lot Size:||1200 Shares|
|Issue Price:||₹ 91 Per Equity Share|
|Listing At:||NSE Emerge|
|Listing Date:||Nov 08 2023|
Promoters And Management:
Financials of Shanthala FMCG Products Limited IPO:
Particulars ( In Lakhs )
|Revenue from Operations||3,930||3,226||4,052||1,574|
|Cost of Goods Sold||3,810||3,133||3,936||1,512|
|Employee benefits expenses||36||45||49||25|
|Depreciation & Amortisation||1||2||2||1|