Devyani International, the largest operator of marquee quick service restaurants (QSR) such as KFC and Pizza Hut will enter Dalal Street next week to launch its initial public offering (IPO). The company has filed its Red Herring Prospectus (RHP) with the capital markets regulator for its public issue that opens on Wednesday, 4 August 2021 and will remain open for subscription by investors till Friday, 6 August 2021. The public issue comprises fresh issue of shares worth Rs 440 crore and offer-for-sale (OFS) of issuing up to 15.53 crore equity shares by existing shareholders and promoters.
An OFS comprises 6.53 crore shares by Dunearn Investments Mauritius Pte, up to 9 crore shares by RJ Corp Ltd. This will be the third restaurant chain to come up with an IPO in the recent time, following the successful listing of Burger King India and Barbeque-Nation Hospitality. Investment Bankers appointed to the issue are Kotak Mahindra Capital Company Ltd, CLSA India Pvt Ltd, Edelweiss Financial Services Ltd and Motilal Oswal Investment Advisors Ltd. The registrar to the issue is Link Intime India Private Ltd. Upon successful completion of its IPO, Devyani International will join the likes of Jubilant FoodWorks Ltd, Westlife Development Ltd and Burger King India.
Devyani is the single largest QSR company in India to be listed on Swiggy and was amongst the largest QSR companies in India to be listed on the Zomato platform in 2019 and 2020. The weighted average return on net worth for the last three fiscals is 24.26 per cent. While the industry peers group P/E ratio stood at 179.21x. The company has planned to utilise the net proceeds towards funding the repayment or prepayment of all or certain of borrowings worth Rs 324 crore, and for general corporate purposes.
Devyani International business is broadly classified into three verticals that includes stores of KFC, Pizza Hut and Costa Coffee, operated in India (KFC, Pizza Hut and Costa Coffee referred to as Core Brands, and such business in India referred to as the Core Brands Business); stores operated outside India primarily comprising KFC and Pizza Hut stores operated in Nepal and Nigeria (International Business); and certain other operations in the F&B industry, including stores of our own brands such as Vaango and Food Street (Other Business).
Devyani International had 692 stores as of March 31, 2021 and 735 stores as of June 30, 2021, across its operations, comprising KFC, Pizza Hut and Costa Coffee stores as well as outlets of other brands such as Vaango.