Emami’s Strategic Leap: Dives into the Health Juice Segment with Axiom Ayurveda Stake!

Friday marked a positive note for the market, with both the Sensex and Nifty reporting gains of 0.49% and 0.59%, respectively. In this optimistic market sentiment, Emami Limited’s shares surged by 5.02%, accompanied by a remarkable increase in trading volume of more than 4.91 times. The company’s current market capitalization stands at Rs 23,930.40 crore.

The driving force behind this surge in Emami’s stock prices is the strategic acquisition of a stake in Axiom Ayurveda. Let’s deep dive:

Emami Limited has taken a significant step by venturing into the juice category through a strategic investment in Axiom Ayurveda Private Limited. Emami has acquired a 26% stake in Axiom, with the exact investment amount remaining undisclosed. This move marks Emami’s entry into the beverage market, particularly in the realm of “AloFrut” juices.

AloFrut juices are a delightful fusion of aloe vera pulp and various fruit flavors, renowned for their refreshing and healthful attributes. Aloe vera, celebrated globally for being a rich source of essential vitamins, minerals, and amino acids, adds significant value to these juices. The AloFrut range offers a diverse selection of unique flavors to cater to different preferences.

But that’s not all. Beyond the AloFrut line, which is at the heart of Axiom Ayurveda’s business, the company boasts an exceptional range of carbonated beverages, including mocktails and energy drinks. Additionally, it has a presence in the Ayurvedic healthcare juice segment under the brand name “Jeevan Ras.”

With its manufacturing facility in Ambala, Haryana, Axiom Ayurveda is further enhancing its capabilities by establishing a state-of-the-art, fully automated modern facility in Jammu (Kathua), involving an investment of Rs 160 crore.

Company Profile:

Emami Ltd, a prominent Indian FMCG company, specializes in the production and distribution of personal care and healthcare products. The company boasts a noteworthy portfolio of well-known household brands, including BoroPlus, Navratna, Fair and Handsome, Zandu Balm, Kesh King, Zandu Pancharishta, Mentho Plus Balm, among others.

In terms of shareholding pattern, on the promoter front, they chose to unpledge a significant portion of their shares, accounting for 6.83% of shares in the last quarter. However, it’s essential to note that despite this release, there remains a pledge on approximately 33.29% of the promoter holdings.

Moreover, promoters have also demonstrated their commitment to the company by increasing their overall holdings from 54.27% to 54.52% in the June 2023 quarter. This reaffirms their belief in the company’s potential and prospects.

Furthermore, the stock has experienced substantial buying activity, surging by over 53% in the past 3 years.

Disclaimer: This blog is intended solely for educational purposes. The securities mentioned are provided as examples and not recommendations. The information is sourced from various secondary sources on the internet and is subject to change. Please seek advice from an expert before making any related decisions.