Devyani International IPO: The Rs 1838 crore IPO of Devyani International has opened for subscription today on 4th August and will remain open till 6th August. This company is the largest franchisee of Yum Brands in India. Apart from this, it is also one of the largest companies running the country’s largest chain quick service restaurants which runs brands like KFC, Pizza Hut and Taco Bell. Under the company’s IPO, new shares and shares will be issued under Offer for Sale (OFS). Before the IPO, the company has raised Rs 824 crore from anchor investors.
New IPO: It is raining IPO, investors have a chance for three days to invest money in four companies
Devyani International IPO Details
- The company has fixed a price band of Rs 86-90 per share. Investors have to bid in lots of 165 shares i.e. according to the upper price of the price band, at least Rs 1485 will have to be invested.
- Under the issue, shares worth Rs 1398 crore will be issued under offer for sale while new shares of Rs 440 crore will be issued. The face value per share will be Rs.
- 75 per cent of the issue is reserved for qualified institutional buyers, 15 per cent for non-institutional investors and 10 per cent for retail investors.
- The money raised through the IPO will be used for repayment or prepayment of the loan.
Should I subscribe to IPO?
- Devyani International has more than 50 thousand restaurants in more than 150 countries. According to analysts at Marwari Financial Services, the company is going to be listed with an EV (Enterprise Value) / EBITDA of 62.39 crores and a market cap of 10.8 thousand crores on the basis of adjusted EBITDA of Rs 1789.23 crores for FY 2021 before the IPO comes. Its pierce company Jubilant Food is trading at an EV/EBITDA of 66.02 and Westlife Development 206.11. Devyani International operates the core brand business (KFC, Pizza Hut and Costa Rica stores in India), international business and other businesses. The company is getting more than 80 percent revenue from the core brand business and international business for the last three financial years. Brokerage firm Marwari Financial Services has given a ‘subscribe’ rating to the issue.
- According to analysts at Angel Broking, Devyani International’s post issue FY2021 EV/sales is lower than Jubilant Foodworks, Burger King India and Westlife India. Devyani International has better operating margins as compared to Westlife Development and Burger King. According to Angel Broking, if the valuation of the company is at a reasonable level, then it can be subscribed.
(Article: Kshitij Bhargava)
(The stock recommendations given in the story are those of the respective research analysts and brokerage firms. Financial Express Online takes no responsibility for the same. Investments in capital markets are subject to risks. Please consult your advisor before investing.)