Devyani International – Page 4

August 4, 2021August 4, 2021

Top market voices on IPOs, SBI Q1, Bharti Airtel, and more

Representational image: Analysts, industry experts, industry captains

On Bharti Airtel | Kunj Bansal, CIO, Karvy Capital: The company has given reasonably decent quarterly numbers and the expectation of the stock to do well has been for almost six quarters. Unfortunately, it is quite surprising and difficult to fathom why the stock is not performing in such a bullish market but yes, it is positive for Bharti Airtel.

On SBI | Krishnan ASV of HDFC Securities: (Gross NPAs higher:) No cause to worry because every bank has been reporting 30-40 bsps. Given the environment we are in, April and May were tough months there is no reason to believe SBI was immune to that. (Slippages and write-offs came in lower than estimates:) The write off is close to about Rs 3500 crore, the restructured portfolio is about Rs 5500 crore. Generally, it is well contained, you cannot be completely immune in this environment. So given the circumstances, I think SBI has managed the portfolio far better than we could give them credit for. We have a buy (on the stock).

sbi, sbi results, sbi share price — On SBI | Prakash Diwan, Market expert: (Loan growth at 5.8%:)I think the entire focus of the bank would have been to curtail and contain fresh slippages and the SMA-2 numbers do tell you that. The net interest income growth for most players have been a struggle especially if you are watching your back in terms of quality. Would you stick with SBI among PSUs? There is nothing compelling about other stocks in terms of scale, so SBI stands to be best in the PSU lot, otherwise, we have to go down to very small banks, which have turnaround triggers.

On Titan | Rakshit Ranjan of Marcellus Investment Managers: Titan was added about four-five months back. The reason for adding it has been the rise in conviction in our research team’s framework for assessing the ability of Titan to capitalise on the wedding jewellery market opportunity. The omnichannel offering that they are developing via Caratlane – that is the massive long term addition or longevity addition to Titan’s free cashflows from our perspective.

On Exxaro Tiles IPO | Himanshu Shah, CFO, Exxaro Tiles: We are targeting total of Rs 160 crore. Our main objective from this IPO proceeds is to pay our existing long-term debt of around Rs 50 crore and the remaining is for the working capital requirement for future growth and general corporate purpose. In our existing business model, we are more in the domestic market say around 86 percent in our domestic market and the remaining 14 percent of our topline is export. So, in the future also as we are targeting our revenue growth from the existing current level to 4-5 times for the next four to five years. So, we are targeting 20 percent from exports from the coming turnover and the remaining will be our domestic market as we are stronger in the domestic market.

On Devyani International | Deven Choksey of KRChoksey Securities: Of the lot, Devyani International with a strong franchise and the plans that they have is possibly attracting my attention. Probably it remains all of the favourites. QSR format is a good category of the business that is growing systematically at a higher rate of growth. We are likely to see higher growth continuing into the QSR format. If you look at the kind of appetite for these particular stocks into the portfolio be it Jubilant Foodworks, be it Westlife Development, be it, Burger King, I would think that this company would probably register a good claim as far as entry into some of the funds is concerned. Could remain positive on this company. Though they are making losses, they hold a good chance in the coming period.

On Windlas Biotech | Deven Choksey of KRChoksey Securities: The company looks promising. Having a presence among the top10 pharma players in the country, this company holds a good amount of promise. maybe one will have to take a deep dive into the subject of injectibles and probably understand a little bit more from the management at some point in time as to how it is going to bring up the business for the company but looks extremely promising from the investment perspective.

August 4, 2021August 4, 2021

Devyani International IPO: Aim to turn profitable in FY22, says management

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The Devyani International’s IPO has opened today (Aug 4) and the price band is Rs 86 to 90 share. The company’s brands are household names such as KFC, Pizza Hut and even Costa Coffee. The total size of the issue is Rs 1840 crores out of that the fresh issue is Rs 440 crores.

To discuss about the business outlook going forward, CNBC-TV8 spoke with Ravi Kant Jaipuria, Chairman of Devyani International and to know if one should subscribe to the IPO, the channel spoke with Gurmeet Chadha, Co-Founder & CEO, Complete Circle Consultants.

Talking about where the funds raised via the IPO would be utilised, Jaipuria said it is basically going to be used for repaying the debt, and we have enough cash flows to expand our business and we would not be looking for any borrowing or diluting further.

The company has been loss-making for the last three years but the losses have narrowed in FY21 compared to the previous year. When asked when they would turn profitable, he said, “Even this year, once we have a normal year, we are looking to get back to profits. We are already profitable at brand levels and all our brands and I think this year if we don’t have another third attack of pandemic we should be profitable this year itself.” So, we would be profitable in FY 22 on the net level, he added.

The company has franchise rights for young brands. When asked about royalty arrangement and if there could be royalty escalation whenever the contract is renewed, he said, “So we have specific areas, for Pizza Hut we have most of India for delivery and for KFC we have specific areas which is mostly south, east and certain geographies in the north. But royalties reasonably fixed. It has been fixed for the last 25 years and we don’t see any changes coming in it.

Also Read: Pizza Hut operator Devyani International IPO subscribed 33% so far on day 1

The Costa Coffee brand has been struggling for the company, so would they continue to invest in that brand or are there any changes in the plans, Jaipuria said, “No, there’s no change. We’re just waiting to finalise our agreement, which we hope to happen very soon. It is a great brand, and as soon as the agreement is signed, which as I said would be in the next couple of weeks, we will expand this brand quite aggressively.”

On blended margin profile, he said, “I think blended margins if you look at, you are looking at about 15% EBITDA, which is very healthy in the fast-food business and this is consolidated with all the brands included.”

Also Read: Devyani International IPO: Should investors subscribe? Here’s what brokerages say

“We are looking at about 200 stores average to be opened over the next five years — so every year about 200 stores at least which would be KFC and Pizza Hut mainly and then Costa and Vaango our own grown brand.

For the entire discussion, including the analysts’ analysis, watch the accompanying video

Devyani International IPO: Pizza Hut operator to launch offering today; key things to know

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Summary

Devyani International IPO will open for subscription on August 4. The company has set a price range of Rs 86-90 per equity share for its public offering. At the higher end of the pricing band, the total fundraising comes to Rs 1,838 crore.

Devyani International, the largest franchisee of Pizza Hut, KFC, and Costa Coffee in India, is going to open its initial public offering (IPO) for subscription today.

Along with Devyani International, three other IPOs including that of Krsnaa Diagnostics, Windlas Biotech, and Exxaro Tiles will be launched.

Here are key things to know about Devyani International’s IPO:

The three-day initial public offering will open for subscription on August 4, and conclude on August 6, according to the company’s virtual press conference.
In consultation with merchant bankers, Devyani International has set a price range of Rs 86-90 per equity share for its public offering. At the higher end of the pricing band, the total fundraising comes to Rs 1,838 crore.
The IPO consists of a fresh issue of equity shares worth Rs 440 crore and an offer-for-sale of up to 155,333,330 equity shares by the promoter and existing shareholders. Under the offer-for-sale, Dunearn Investments (Mauritius) Pte Ltd, a wholly-owned subsidiary of Temasek Holdings, will offload 6,53,33,330 shares and promoter RJ Corp will sell 9 crore shares.
Investors can bid for a minimum of 165 equity shares and in multiples of 165 equity shares thereafter. Retail investors can invest a minimum of Rs 14,850 per lot and the maximum investment would be Rs 1,93,050 for 13 lots.
The company has reserved up to 75 percent of the total offer for the investment by qualified institutional buyers, 10 percent by retail investors and 15 percent by non-institutional investors.
The allotment date for Devyani International is August 11. Refunds and share accreditation are expected to take place on August 12 and 13, respectively. In terms of the listing, a preliminary date of August 16 has been set, although this has yet to be verified.
The company will utilise the net proceeds from its fresh issue towards repayment of borrowings and general corporate purposes. The offer for sale money will go to selling shareholders.

Devyani International is an associate company of RJ Corp, the largest bottling partner of food and beverages (F&B) major Pepsico, and has interests in the Indian retail F&B sector.

The company reduced its loss in FY21 to Rs 62.98 crore from Rs 121.42 crore in FY20. Revenue in the same period declined to Rs 1,134.84 crore from Rs 1,516.4 crore.Devyani International is the largest franchisee of Yum Brands, operating core brands such as Pizza Hut, KFC, Costa Coffee besides its own brands such as Vaango, Food Street, Masala Twist, among others. It currently operates 297 Pizza Hut stores, 264 KFC stores, and 44 Costa Coffee as of March 2021 in India.

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index	Price	Change
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sensex	₹1,882.60	+28.30
nifty IT	₹2,206.80	+30.85
nifty bank	₹1,318.95	-14.95

index	Price	Change
nifty 50	₹16,986.00	-7.15
sensex	₹1,882.60	+8.30
nifty IT	₹2,206.80	+3.85
nifty bank	₹1,318.95	-1.95

index	Price	Change
nifty 50	₹16,986.00	-7.15
sensex	₹1,882.60	+8.30
nifty IT	₹2,206.80	+3.85
nifty bank	₹1,318.95	-1.95

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