The credit ratings agency ICRA said that the ratings reaffirmation continues to factor in the significant experience of the promoters of Tasty Bite Eatables (TBEL) in the food industry; and the majority stake acquisition at holding company level (PBI Inc.) by Mars Incorporated, USA, which is expected to impart wider global footprint and research and development (R&D) knowhow for the company.

TBEL also enjoys wide distribution network of the Tasty Bite brand in the USA through strong relationships with established retailers and distributors. Continuous addition of new products through product innovation coupled with technological barriers for the peculiar products supplied to leading brands in the domestic market has ensured steady revenue growth for TBEL in the domestic division.

ICRA also took note of positive demand outlook for frozen formed products and sauces, given the exponential growth of QSR (quick service restaurants) industry in the domestic market. TBEL's exports division has also shown steady revenue growth over the last few years on account of increasing demand for natural and convenience food.

The ratings are, however, constrained by TBEL's comparatively moderate scale of operations in the intensely competitive processed foods industry dominated by large players, especially in mature markets such as USA. The company continues to show high customer concentration risk with ~65% of revenues being generated from exports to the holding company, although increasing share of domestic revenues, provides some cushion.

Shares of TBEL ended 9.73% lower at Rs 10382.40 in yesterday's trading session.

Tasty Bite Eatables is engaged in the business of manufacturing and selling prepared foods. The company offers a range of ready-to-serve (RTS) ethnic food products under the brand name Tasty Bite and Frozen Formed Products (FFP).