Published 21:20 IST, November 27th 2020
Burger King India IPO to float shares between Rs 59-60, aims to raise Rs 810 crores
With Burger King India set to roll out its IPO on December 2, the fast-food restaurant chain is slated to price the shares between Rs 59-60.
With Burger King India set to roll out its Initial Public Offering (IPO) on December 2, the fast-food restaurant chain is slated to price the shares between Rs 59-60. The company aims to raise nearly Rs 810 crores through the issuance of shares after having raised Rs 92 crores through pre-IPO funding from Amansa Investments Ltd, which bought shares at the price of Rs 58.5. Burger King has reserved up to 10 per cent of the IPO for retail investors, 15 per cent for non-institutional investors and 75 per cent for qualified institutional investors.
Burger King India will use the funds raised through the IPO to inaugurate a new company by repaying or prepaying outstanding borrowings of the company obtained for setting up of new company which will be owned by Burger King Restaurants, as per its red herring prospectus. Under the Master Franchise and Development Agreement, the company is required to develop and open at least 700 restaurants by December 31, 2026. Burger King India has 261 restaurants across 87 cities in India including several metropolitan regions.
Extrapolation to employ additional 8,640-10,800 persons
"Currently, we have 268 stores, of which 8 are franchise mainly located at airports and the rest are company-owned. The expansion will mainly consist of company-owned stores," Burger King India CEO and member of board Rajeev Varman told PTI. By extrapolation, Burger King, which employs an average 20-25 people per store, is likely to generate an employment opportunity for additional 8,640-10,800 persons with this expansion. It currently employs 4,836 people, including its restaurants and corporate office.
Investors can bid for a minimum one lot of 250 equity shares and in multiples of thereafter, upto 13 lots. Retail investors can thus apply for maximum 3,250 equity shares at higher end of the price band. Compared to major fast-food chains in India, Burger King owned a market share of 5% in the FY 19-20 whereas Domino's Pizza owned the largest share with 21% followed by McDonald’ 11 per cent, KFC 10 per cent, and Subway with 6 per cent. Kotak Mahindra Capital Company, CLSA India, Edelweiss Financial Services and JM Financial are the book running lead managers to the issue. Equity shares are expected to debut on bourses around December 14.
(With PTI Inputs)
Image Credits: AP
Updated 21:20 IST, November 27th 2020