Barbeque Nation: Entry to market on April 7, will COVID-19 spoil investors’ profits?

Barbeque Nation: Barbecue Nation’s stock market listing may be weakened amid the rapidly growing cases of corona virus.

Barbeque Nation IPO Stock Listing: Barbecue Nation’s stock market listing may be weakened amidst the fast growing cases of Corona virus. The kind of ups and downs that are seen in the market may affect the IPO listing. The stock is not being traded in the gray market, so it is clear that there is not much craze about it. Rakesh Jhunjhunwala, a veteran investor in the company, has also invested money. The issue received a fair response from the investors and was subscribed 5.98 times. The IPO of Barbecue Nation was open from 24 March to 26 March and its price band was fixed at Rs 498-500. One lot was of 30 shares.

No trading in gray market

Barbecue Nation shares are not being traded in the gray market. From this it is seen that there is less craze about it. While the shares of upcoming IPO Lodha developers are trading in the gray market at a premium of 20 to 25 rupees. This IPO will be open from 7 April to 9 April. The gray market is an unofficial trading platform, where the stock is traded before it is listed on the BSE or NSE. Here the trading pattern gives an idea of ​​how the stock will enter the stock market.

Market fluctuations due to COVID 19

The second wave of corona virus is becoming increasingly dangerous in the country. More than 1 lakh cases of corona virus were reported for the first time in 1 day on Sunday. Whereas on Monday, around 97 thousand cases were seen. Due to this, there are sharp fluctuations in the market. The Sensex had lost 1400 points on intraday on Monday. Whereas on Tuesday, April 6, the market has fluctuations. This can have an impact on the listing of Barbecue Nation shares.

Brokerage has also expressed concern

Brokerage House Angel Broking gave a neutral rating on Barbecue Nation’s IPO. The brokerage says that the biggest concern is that due to the Corona virus, restaurant businesses are still affected. Strict action is being taken on COVID 19 in different states. The restaurant business will still be affected by this. Growth strategy has been difficult to implement. In such a situation, it is challenging for the restaurant to choose a new city or location. The company has been in a constant loss in the past. In the current environment, the valuation is also more visible.

How was the response of investors

Barbecue Nation’s IPO received a better response from investors. This IPO was received 5.98 times the bids overall. According to the data available on the NSE, the IPO received bids for 2.99 crore shares, while the issue size was 5 million shares. Reserve Porson received 13.13 times bids for retail investors, while Reserve Porsons subscribed 5.11 times for qualified institutional buyers (QIBs). Reserve Porson subscribed 3.10 times for non-institutional investors. Reserve Porson also received 1.02 times bids for employees.

How much stake of Rakesh Jhunjhunwala

The Bangalore-based company has been invested by Alchem ​​Capital, a firm of veteran investor Rakesh Jhunjhunwala, and private equity firm CX Partners. Promoters hold 60.24 per cent stake in Barbecue Nation. CX Partners holds 33.79 per cent and Rakeshan Jhunjhunwala’s investment firm Alchemy Capital holds 2.05 per cent.

About the company

As of December 2020, Barbecue Nation Hospitality is operating 147 outlets in 77 cities across the country and 6 in 3 countries UAE, Oman and Malaysia. The company opened its first restaurant in 2008. The company’s total operating revenue in FY 2020 (FY20) was Rs 850.8 crore and the CAGR for FY17 to FY20 was 19.5 per cent. Barbecue Nation Hospitality had applied to SEBI for an IPO in February last year and in July 2020, SEBI approved the IPO.