Barbeque Nation is one of the leading casual dining chains in India with 164 restaurants.
Rakesh Jhunjhunwala, backed by Barbeque Nation Hospitality, made a low stock exchange listing today. The company’s shares started trading at Rs 492 per share, down 1.6% from the issue price of Rs 500 each. Barbeque Nation is the eighteenth stock to be listed on the stock exchanges this year and the first to debut in the new fiscal year. In its early days, shares of Barbeque Nation Hospitality had a market cap of Rs 1,847 crore. Alchemy Capital of investor Ace Rakesh Jhunjhunwala owns a stake in Barbeque Nation Hospitality.
Check the price live: Barbeque Nation Hospitality
Barbeque Nation raised Rs 452 crore from the issue earlier last month, with investors of all categories oversubscribing their share of the IPO. Barbeque Nation’s IPO was subscribed nearly 6 times by investors. Offers were received for 2.99 crore shares against 49.99 lakh shares offered. After the issue, the promoter’s stake in the company will increase to 37.8% from 47.8% before the issue, while the public stake will increase from 52.2% to 62.2%.
Barbeque Nation is one of the leading casual dining chains in India with 164 restaurants. In addition, the company owns a 61.35% stake in a company called “Red Apple”, which operates 11 Italian cuisine restaurants. The company operates a large number of restaurants in metropolitan cities where the average billing reaches nearly Rs 900 against Rs 650 in level II and III cities. Over the next two years, the company would spend Rs 90 crore to expand its operations into existing cities.
Domestic brokerage firm ICICI Direct, earlier in a note, said that at the IPO price, Barbeque Nation is at 2.4x FY20 EV / sales. “The CDR chain industry is expected to grow at a faster rate over the next five years. However, we believe that larger restaurants and the limitations in increasing delivery sales may impact the growth of the business, ”they said.
Meanwhile, Yes Securities in a note pointed out that a pre-IPO grant was made by the company earlier in December and January at 50% less than the IPO price. “We also note that the first fundraisers in 2018 were carried out at a much higher price, but the fundamentals have deteriorated since then,” added Yes Securities, pinning an “Avoid” tag on the issue.
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