Aelea Commodities made a spectacular debut on the BSE SME today, with its shares opening at ₹165 each, a significant 74% premium over the issue price of ₹95. This impressive start has put the spotlight on Aelea Commodities, highlighting the strong market interest and investor confidence in the company.
The SME IPO, valued at ₹51 crore, was open for subscription from July 12 to July 16, 2024, within a price range of ₹91–95. The offering comprised solely of a fresh issue of 53.69 lakh newly issued shares, with no offer-for-sale component. This structure allowed the company to raise substantial capital directly from the market, showcasing its growth ambitions and strategic goals.
Investor response to the IPO was overwhelmingly positive, with an overall subscription rate of 196 times. Non-institutional investors were particularly enthusiastic, subscribing 390 times, while retail investors also showed strong interest, with a subscription rate of 164.95 times. This robust demand underscores the market’s confidence in Aelea Commodities’ business model and future prospects.
The proceeds from the IPO will be utilized to finance several key initiatives. The company plans to set up a new manufacturing unit, install new plant and machinery, and purchase additional equipment for its existing facilities. These investments are aimed at enhancing production capacity, improving operational efficiency, and meeting the growing market demand for its products.
Aelea Commodities specializes in the processing and trading of cashews and is also involved in trading a diverse range of commodities including sugar, pulses, soybeans, rice, and wheat flour.
The company operates under two distinct business models, B2B and B2C. In the cashew segment, it has established a strong presence in both B2B and B2C markets, serving wholesale clients as well as individual consumers. For other commodities, such as sugar and pulses, the company focuses exclusively on the B2B channel.
The company’s operations are extensive, supplying products both domestically and internationally. Domestically, Aelea Commodities serves major customers in Rajasthan, Karnataka, Gujarat, and Mumbai. Internationally, it has significant customer bases in Dubai and Sri Lanka. This wide reach helps the company maintain a diversified revenue stream and mitigates risks associated with market fluctuations.
Aelea Commodities has reported strong financial performance over the years. For the nine-month period ending December 31, 2023, the company’s revenue from operations was ₹8,402.79 lakh. For the fiscal years ending March 31, 2023, March 31, 2022, and March 31, 2021, its revenue was ₹7,968.23 lakh, ₹6,596.23 lakh, and ₹39,084.83 lakh, respectively. These figures reflect steady growth and a solid financial foundation.
Aelea Commodities is looking to diversify its revenue streams by venturing into the processing of cashew nut shells into cashew nutshell liquid (CNSL). This initiative represents a significant opportunity to extract additional value from its raw materials. CNSL has wide-ranging applications across various industries, including automotive, pharmaceuticals, and chemicals, where it is used in products such as brake linings, varnishes, and insecticides.
This diversification strategy not only adds a new revenue stream but also reinforces the company’s commitment to sustainability by minimizing waste and maximizing resource utilization. With this expansion and diversification strategy, Aelea Commodities is well-positioned to solidify its leadership in the cashew processing industry while exploring new avenues for growth and innovation.
The company is expanding its existing cashew processing unit and establishing a new facility to optimize efficiency and address increasing market demands. As of December 31, 2023, its current manufacturing unit is operating at 95% of its installed capacity, processing 38 MT per day out of a total 40 MT per day capacity. This expansion will enable the company to meet growing demand and enhance its market position.
