Pakistan’s only pasteurized egg products company announced IPO on PSX

Barkat Frisian Agro Limited (BFAL) has announced a PKR 880.5 million ($3.1 million) Initial Public Offering (IPO) as the company plans to expand pasteurized egg product output by 70% to 29,000 metric tons.

According to a document, Arif Habib Limited (AHL) is mandated by BFAL to act as lead manager and book runner for raising funds through the offering. BFAL intends to utilize the proceeds to fund the construction of its new plant in Faisalabad.

The book building for 67.735 million shares at a price range of PKR 13 to PKR 18.2 per share will commence on February 17, 18.

Operating under the Special Economic Zones Act, the company enjoys a 10-year income tax holiday, exempting it from corporate and minimum taxes. The tax exemption expires in 2029 for the Karachi plant and 2036 for the new Faisalabad plant.

Currently, the plant has a production capacity of 17,000 metric tons which would rise to around 29,000 metric tons, aimed at increasing both domestic sales and export of its value-added pasteurized egg products. The company has already initiated the construction of its new plant. The new production facility will have a capacity of 12,000 tons. The project is estimated to be completed by Q3 FY26.

The company’s profit in 2025 is expected to touch PKR 631 million, which would likely increase to PKR 812 million next year, while export sales are likely to jump to PKR 1.658 billion in 2026 from PKR 1.358 billion in 2025. Moreover, local sales have been projected to gear up to PKR 9.275 billion from PKR 6.349 billion.

BFAL is a Pakistan-Dutch joint venture between the Buksh Group and the Frisian Egg Group. The company specializes in the production of pasteurized egg products, including whole eggs, yolks, whites, and their derivatives for HoReCa, sauces and mayonnaise, and the baking and confectionery industry.

BFAL is currently operating at 90% capacity and enjoys a monopoly as Pakistan’s only producer of pasteurized egg products. Meeting less than 10% of the local demand for processed egg products, BFAL has significant growth opportunities in both domestic and export markets.

In FY24, BFAL sold 11,572 tons of pasteurized egg products in the local market, representing 7.6% of the total addressable market of around 150,000 tons, highlighting the significant growth potential.

The market for value-added processed egg products is driven by rising food spending, the need for longer shelf-life, and increasing demand for convenience foods. Retail demand for preserved egg products grew by 15-20% during the pandemic.

Pakistan’s per capita egg consumption of 90 eggs remains significantly lower than the global average of 180 eggs, indicating substantial market potential for value-added pasteurized eggs. The United Arab Emirates, Qatar, Oman, and Saudi Arabia are top destinations within the region for processed egg products. Pakistan competes with India and Turkey in servicing the demand coming from the Gulf region.

Pakistan holds a competitive advantage in the global market due to the cost-effective availability of eggs, which serve as the primary raw material for producing pasteurized egg products. Maize, Pakistan's third-largest crop, serves as the primary ingredient for poultry feed, translating to a cheaper cost of eggs that are used as the raw material by the company. This cost advantage enhances Pakistan's competitiveness in the global processed egg product markets, offering a sustainable edge for BFAL.