Burger King: Grand opening
Quick restaurant chain Burger King India shares had a strong opening premium of 92.25% on the first day of trade on December 14.
The listing premium was better-than-expected given the stellar subscription and consistent strong revenue growth as well as store additions over the past more than five years of operations.
The stock opened at Rs 115.35 , against issue price of Rs 60 on the BSE, while on the National Stock Exchange, shares made a debut at Rs 112.50, a 87.50% premium over IPO price.
Burger King was expected to list at around 70-75% premium over issue price, while it was also trading at 75% premium in the grey market.
Analysts are optimistic on Burger King’s growth story considering improving organised industry growth benefiting from reduced competition from unorganised restaurants due to COVID-related challenges and expansion of its outlets wherein Burger King is well-positioned to expand its footprint in India from 260+ to 700 stores by December 2026.
Burger King India raised Rs 810 crore through public issue which was subscribed 156.65 times during the December 2-4 period. The company is going to utilise issue proceeds for debt repayment and expansion.
The quick service restaurant chain has 259 owned Burger King restaurants and nine sub-franchised Burger King restaurants as per the prospectus filed with the SEBI. Burger King has a target to increase its number of restaurants to 700 by the end of December 2026.
The company recorded a 49% CAGR growth in revenue and 258% in EBITDA during FY18-FY20, backed by strong store strength in the same period, though it reported losses at PAT level.
This document is meant for the recipient only for use as intended and not for circulation. This document should not be reproduced or copied or made available to others. The information contained herein is from the public domain or sources believed to be reliable. While reasonable care has been taken to ensure that information given is at the time believed to be fair and correct and opinions based thereupon are reasonable, due to the very nature of research it cannot be warranted or represented that it is accurate or complete and it should not be relied upon as such. Also above note is not a recommendation to Buy or SELL and is only a view based on facts and figures and we will be in no way responsible for any losses incurred by anyone who uses this information to either trade or invests securities mentioned herein.