SE Fruits & Vegetable Gets PSX Approval for IPO, Eyes Up to Rs1.92bn

Karachi: SE Fruits & Vegetable Limited has secured approval from the Pakistan Stock Exchange (PSX) for its initial public offering (IPO).

The Sargodha-based horticulture exporter plans to raise between Rs1.2 billion and Rs1.92 billion. The funds will support working capital and expand its processing and export capabilities.

The company will offer 30 million ordinary shares, equal to 32.01% of its post-IPO paid-up capital.

The IPO has a floor price of Rs40 per share. Through book building, the strike price can rise by up to 60% to a maximum of Rs64.

IPO Structure

At the floor price, the offering would generate Rs1.2 billion. At the maximum price, proceeds could reach Rs1.92 billion.

Under the proposed structure, 22.5 million shares, or 75% of the issue, will be offered through book building.

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The remaining 7.5 million shares, representing 25%, will be reserved for general investors.

Topline Securities Limited and Growth Securities Limited are acting as lead managers for the issue.

Export Business

SE Fruits & Vegetable, formerly known as Shaheen Enterprises, has been exporting horticultural products since 1998.

Its key products include kinnow, mangoes and potatoes.

The company exports to markets across the Middle East, Far East, South Asia and Central Asia.

Moreover, SE has built a significant presence in the international horticulture market. However, limited working capital has constrained its ability to meet growing demand.

IPO Funds to Support Expansion

Around Rs940.2 million, or 78% of the funds raised at the floor price, has been allocated to working capital.

The company plans to spend another Rs153.8 million on cold-chain and processing expansion.

It has also allocated Rs50 million for international offices in the UAE and Uzbekistan.

In addition, Rs30 million will be used for ERP and asset-tracking systems. Another Rs26 million is planned for solar energy and grid-related investments.

Revenue and Profit Rise

SE reported net revenue of Rs2.133 billion in FY2026, representing a 24% year-on-year increase.

Profit after tax reached a record Rs303.8 million during the year.

The company has remained debt-free since FY2024.

Between FY2022 and FY2026, revenue recorded a compound annual growth rate of around 28%. Profit after tax grew at an estimated compound annual rate of 31%.

Strong Demand for Kinnow Processing

SE currently has seasonal kinnow processing capacity of 36,000 tonnes.

However, indicated demand from existing and potential international buyers stands at around 65,130 tonnes.

The company exported 5,115 tonnes of kinnow in FY2026.

This gap highlights the working-capital constraint that the IPO is primarily designed to address.

Following the deployment of IPO proceeds, SE expects revenue to increase by around 137% to Rs5.05 billion in FY2027.

Profit after tax is projected to rise approximately 124% to Rs680 million.

The company estimates FY2027 forward earnings per share at Rs7.25.

IPO Valuation

At the IPO floor price of Rs40 per share, SE Fruits & Vegetable is valued at approximately 8.4 times trailing earnings.

This represents a discount of around 55% compared with the listed food-sector price-to-earnings multiple of approximately 18.75 times.

Based on projected FY2027 earnings, the forward P/E ratio would fall to around 5.5 times.

That implies a potential valuation discount of approximately 71% against the current listed food-sector multiple.

The IPO will provide SE Fruits & Vegetable with additional capital to expand processing capacity, strengthen its cold chain and increase its presence in international markets.