Amira Foods Expanding Globally

Packaged-foods producers are seldom mentioned in the same breath as growth stocks, but that's the case with Amira Nature Foods (ANFI).

The company is best known for its Indian specialty rice, called basmati rice. Although it's essentially an Indian company, the headquarters are in Dubai, United Arab Emirates, as the result of a restructuring several years ago to turn Amira into a global brand.

Its products are sold in about 40 countries.

The company's strategy is to continue expanding globally. It recently started selling in South Korea and the United Kingdom.

It is also introducing new products. CEO Karan Chanana said at the Nov. 11 earnings announcement that its new Amira Organic business is doing well.

Amira's earnings doubled in the September-ended quarter as sales increased 36%. In fact, earnings soared at a triple-digit pace in four of the past five quarters.

Although a few other packaged-foods stocks have rallied sharply this year, Amira easily tops the industry group's average quarterly EPS growth over three years.

Amira's sales growth ranged from 10% to 56% over the same five periods, for a three-year average growth rate of 29%.

Analysts at Deutsche Bank, one of the underwriters of Amira's 2012 IPO, see a bullish future for the company.

"Looking ahead, we see continued strong growth potential driven by the company's plan to enter 30 new markets over the next few years ... growing global demand for basmati rice, and expansion into additional categories such as ready-to-eat meals, snacks, and the previously discussed organic business.

"While visibility into the company's various markets remains limited and more quarterly detail around the top line would be helpful, we believe CEO Chanana continues to do a good job meeting with investors and providing color around the company's growth strategy."

The stock went public on the NYSE in October 2012 at $10 a share. It traded below that until September of this year, when it broke out past resistance at 10.

Shares shot up as high as 17.41 earlier this month, then pulled back sharply to the 10-week moving average. The stock found support at that level, however.

Amira is thinly traded, which adds some risk. Also, there's ample competition in the industry.