Chaman Lal Setia Exports Limited

Chaman Lal Setia Exports Limited (CLSE) was incorporated in Amritsar, Punjab in 1994. It's one of the oldest Rice Millers cum Exporters of Basmati rice of all varieties from India. The company is engaged in the business of milling and processing basmati rice. The company has been involved in export operations since 1982 and was recognized as an export house by the Ministry of Commerce in 1989, at present the company is a 'Star Export House'. The Basmati Brands are Maharani, Mithas, Begum and Non-basmati brands are Green World Aromatic Rice, also other innovative products such as 'Maharani Diabetics Rice', 'Basmati Rice Plus' and organic products such as 'Maharani - Brown Basmati Rice'. Company's brand contributed to ~10% of revenues, growing by 46% in FY24. Company is India's largest private label exporter with 300+ private label brands. Company has 3 rice mill in Karnal (Haryana), Amritsar(Punjab) & Gandhidham(Gujrat). Amritsar plant is currently shut for remodeling. 100% of products are manufactured in India. Karnal (Manufacturing, processing & packaging) contributed 93% of sales whereas Gandhidham (Processing & packaging) contributed to 7% of sales.  - Silos Capacity: 18,750 MT - 12 Sortex: 660 MT/day - 9 Dryers: 270 MT/day- 9 Packaging plants: Capacity ranging from 0.5 kg to 1 MT- Warehousing: 80,000 MT Company has a large land bank which they revalued by 80 cr. in FY23 Majority of the production is through procurement of semi-finished rice and conversion to finished rice (mostly requiring Sortex), keeping the overall processing cycle short, and the company remaining relatively asset light. Procurement of Paddy starts in Oct-Nov, resulting in increased inventory levels. Company does not engage into ageing and thus, possess lower inventory risk Inventory stands at Rs. 499 Crs as on Mar 24 and and mostly order booked. The financials of the company is good, RoNW is 17.5% and at CMP its looks fairly priced. Price difference is around 20% from CMP and acceptance ratio as per current share holding for retail will be around 5%, so final buyback ratio may be within 10% and one may get around 1-2% on investment. So we give NEUTRAL rating to this buyback, those who are currently holding must participate in buyback.

• 1 Mr. Rajesh Pirogiwal
• 2 Mrs. Sunita Pirogiwal
• 3 Miss Tanvi Pirogiwal