Madhusudan Kela-Backed Prataap Snacks Stock Falls After Weak Q4 Results Despite Dividend Announcement
Introduction:
Prataap Snacks : Shares of Prataap Snacks Ltd, a small-cap FMCG company backed by renowned investor Madhusudan Kela, came under pressure after the company reported a weak set of numbers for the fourth quarter of FY25. Despite a significant reduction in its quarterly losses and a dividend announcement, the stock reacted negatively as investors weighed in on the muted performance.
The stock opened at ₹1,195 on the NSE, down 0.91% from the previous close. It briefly touched a high of ₹1,216 but failed to sustain the gains. This came on the heels of the company’s Q4FY25 results, which highlighted both improvement in sequential losses and a decline in revenue.
Prataap Snacks Q4FY25 Performance Overview:
The company, best known for its Yellow Diamond brand, reported a 10.48% year-on-year (YoY) revenue growth, reaching ₹398.52 crore in Q4FY25 from ₹386.53 crore in the same quarter last year. However, sequentially, revenue fell by nearly 10% compared to ₹442.68 crore in Q3FY25.
In terms of profitability, the company posted a net loss of ₹11.93 crore for Q4FY25. While this may look disappointing at first glance, it’s a notable improvement compared to the ₹37.92 crore loss in Q3FY25. The sharp drop in losses QoQ is primarily due to an exceptional item recorded in Q3 — a fire at the Jammu plant that led to losses worth ₹34.33 crore. This fire significantly damaged inventory, machinery, and infrastructure, resulting in a one-time blow to the bottom line.
Dividend Announcement:
Despite the operational challenges, the board of Prataap Snacks showed confidence in the company’s long-term potential by recommending a dividend of ₹0.50 per equity share (face value of ₹5). The dividend is subject to shareholder approval in the upcoming Annual General Meeting (AGM).
Madhusudan Kela’s Investment in Focus:
Investor interest in Prataap Snacks spiked after Madhusudan Kela picked up a fresh 4.60% stake (11 lakh shares) in the company during Q4FY25. His total investment is currently valued at approximately ₹134.7 crore. Kela’s entry is seen as a vote of confidence in the long-term prospects of the company, despite the recent volatility.
Stock Performance Snapshot:
- Current Market Cap: ₹2,871 Crore
- Current Share Price: ₹1,200
- 52-Week High/Low: ₹1,296 / ₹747
- 1-Year Return: 34%
- 5-Year Return: 167%
About Prataap Snacks:
Founded in 2009 and headquartered in Indore, Prataap Snacks has grown to become one of India’s leading snack food companies. It operates under the flagship brand Yellow Diamond, offering a wide range of snack products — from potato chips to puffed extruded snacks and traditional namkeens.
With multiple manufacturing facilities and a strong distribution network, the company serves both rural and urban markets. Its focus on affordability, innovation, and market reach has helped it stay competitive against larger players in the Indian snack industry.
📊 Key Financial Ratios (As of FY25)
| Metric | Value |
|---|---|
| Market Cap | ₹2,871 Cr |
| Current Price | ₹1,200 |
| 52-Week High / Low | ₹1,296 / ₹747 |
| Stock P/E | N/A (Loss) |
| Book Value | ₹289 |
| Dividend Yield | 0.17% |
| ROCE (Return on Capital Employed) | -1.38% |
| ROE (Return on Equity) | -1.25% |
| Face Value | ₹5.00 |
📌 Conclusion:
The fall in Prataap Snacks’ stock price post-results highlights investor caution amid operational challenges and margin pressures. However, the sequential reduction in losses, strong brand recall, and Madhusudan Kela’s backing provide some optimism for long-term investors. The dividend declaration is also a small reassurance of the company’s intent to reward shareholders even during tough times.
❓ Q&A Section: Understanding the News at a Glance
Q1: Why did Prataap Snacks stock fall after Q4 results?
A: The fall was due to weak quarterly performance, particularly a decline in revenue and continued losses, even though the loss reduced sequentially.
Q2: What caused the improvement in net loss from Q3 to Q4?
A: In Q3FY25, the company recorded an exceptional loss of ₹34.33 crore due to a fire at its Jammu plant. The absence of such a loss in Q4 led to a reduced net loss.
Q3: Did the company declare a dividend despite the loss?
A: Yes, the board recommended a dividend of ₹0.50 per share, indicating confidence in the company’s future.
Q4: How much stake does Madhusudan Kela hold in Prataap Snacks?
A: He owns a 4.60% stake, amounting to 11 lakh shares, valued at ₹134.70 crore.
Q5: Is Prataap Snacks a profitable company currently?
A: No, the company is currently reporting losses. However, it has significantly reduced its losses compared to the previous quarter.
Q6: How has the stock performed in the long term?
A: It has delivered a 34% return in the past year and a strong 167% return over five years.
For more market insights, follow our news.
Stay tuned for more updates and insights on the stock market! For more insights on investing in the Indian stock market, check out resource like MoneyControl, ET, NSE India.