Tomorrow, 4 August 2021, will see yet another hospitality sector big-wig, Devyani International, going to Dalal Street to rope in some equity investment.
Devyani International is Yum! Brands Inc.’s largest Indian franchise. KFC, Taco Bell, and Pizza Hut are among the most popular quick-service restaurants (QSR) it operates in India. Other brands owned by Devyani International include Costa Coffee, Vaango, Food Street, and Masala Twist.
This IPO makes Devyani International the third-largest restaurant chain to join the bandwagon of hospitality listings on D-Street.
Presumably, because of the successful listings of Burger King India and Barbeque Nation Hospitality, Devyani International plans to raise funds from the share market. It’ll likely prepay or repay its borrowings with the proceeds from this initial public offering.
On that note, let’s dive into further details of the IPO!
What’s the Grey Market Premium for Devyani International IPO?
Of the four IPOs launching tomorrow, market observers are the most bullish on Devyani International, with its shares available at an Rs. 62 premium. Against a share price of Rs. 90, this premium denotes an almost 70% gain.
Here are all the details you need to know about the Devyani International IPO, open until 6 August.
A Rundown of the Devyani International IPO
- The IPO will open on 4 August 2021, Wednesday, and remain open until 6 August 2021.
- The initial price of the IPO has been set at Rs. 86 – 90 per share, which puts it between Burger King India and Barbeque Nation Hospitality’s IPO values.
- The company aims to raise Rs. 440 crores from fresh issue of equity shares. Present investors will sell 15.53 crore equity shares.
Hence, Devyani International seeks to mop Rs 1,838 crores from the primary market in total.
Devyani International IPO Buying Rules
To subscribe to the IPO, investors will need to buy in units of 165 shares. That means the minimum investment will be around Rs. 14,850, taking the upper price band.
Below are the details of the share distribution:
- 75% of the issue is kept aside for QIB (Qualified Institutional Buyers)
- 15% is kept for NIB (Non-Institutional Buyers)
- 10% is set aside for retail buyers
- Moreover, 5.50 lakh shares have been reserved for the organisation’s employees.
Devyani International: What Are Its Strengths?
Some of the strengths of Devyani International are:
- A large offering of well recognised QSR brands with a strong store network across India.
- Yum! Brands Inc.’s largest Indian franchise.
- Focus on cash flow management with a disciplined financial approach.
Presently, Devyani International is a loss-making entity. It has reported losses of Rs. 62.99 crores in the previous year. However, operating highly recognised brands such as KFC makes it stand out, as opined by Chairman Ravi Kant Jaipuria.
Before investing, you should consider other aspects, such as the strengths and weaknesses of the company. You can get more details of Devyani International here.
Frequently Asked Questions
- Which investors are selling their Devyani International’s shares?
RJ Corp Ltd and Dunearn are the primary sellers. They are selling 80.48 lakh and 16.33 lakh equity shares, respectively.
- How much did Devyani International earn from its core business?
It says it has earned 94.19% of its revenue from the operations.
- Who are the investment bankers appointed for the IPO issue?
The investment bankers responsible for the IPO issue are Kotak Mahindra Capital Company, CLSA India, Motilal Oswal Investment Advisors, and Edelweiss Financial Services.