Devyani International Ltd IPO

Current

IPO Synopsis

Devyani International IPO Synopsis

Devyani International Limited, the largest franchisor of leading food brands like KFC, Pizza Hut, & Costa Coffee is all set to launch its Initial Public Offer on August 4, 2021. Devyani International IPO price brand is at Rs.86-90 per equity share and the lot size is going to be 165 shares. Hence if you would like to invest in Devyani International IPO you will have to make a minimum investment of Rs.14,190. 

 

Offer Details
Fresh Issue of Equity Shares aggregating up to ₹440 Crore and Offer for sale of up to 155,333,330 Equity Shares.
The Company proposes to utilise the Net Proceeds towards the following objects:

1 Repayment/prepayment of all or certain of our borrowings; and 
2. General corporate purposes
 

About Devyani International Ltd

It is largest franchisee of Yum Brands in India and are among the largest operators of chain quick service restaurants (“QSR”) in India (Source: Global Data Report), on a non-exclusive basis, and operate 655 stores across 155 cities in India, as of March 31, 2021. Yum! Brands Inc. operates brands such as KFC, Pizza Hut and Taco Bell brands and has presence globally with more than 50,000 restaurants in over 150 countries, as of December 31, 20201. In addition, the company has a franchisee for the Costa Coffee brand and stores in India. The business is broadly classified into three verticals that includes stores of KFC, Pizza Hut and Costa Coffee operated in India.

Devyani International Limited (DIL) is the largest franchisee of Yum Brands in India and among the largest operators of chain quick service restaurants (“QSR”) in India (Source: GlobalData Report), on a non-exclusive basis, and operate 655 stores across 155 cities in India, as of March 31, 2021, and 696 stores across 166 cities in India, as of June 30, 2021.

Yum! Brands Inc. operates brands such as KFC, Pizza Hut and Taco Bell brands and has presence globally with more than 50,000 restaurants in over 150 countries, as of December 31, 2020. In addition, DIL has a franchisee for the Costa Coffee brand and stores in India. The company’s 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 DIL own brands such as Vaango and Food Street (“Other Business”).

Revenue from our Core Brands Business, together with our International Business, represented 83.01%, 82.94% and 94.19% of the company’s revenue from operations in Fiscals 2019, 2020 and 2021, respectively.

Key Points

Competitive Strengths:
Some of the competitive strengths are as follows - 


Portfolio of highly recognized global brands catering to a range of customer preferences:
DIL operates franchises of several highly recognized global QSR brands and is the largest franchise partner for Yum in India. Their Core Brands include:
• KFC, a global chicken restaurant brand with over 25,000 restaurants in over 140 countries, as of December 31, 2020; 
• Pizza Hut, the largest restaurant chain in the world specializing in the sale of ready-to-eat pizza products. Pizza Hut operates in the delivery, carryout and casual dining segments around the world with 17,639 restaurants, as of December 31, 2020;
 • Costa Coffee, a global coffee shop chain with over 3,400 coffee shops in 31 countries. 

Their Core Brands Business as well as their Other Business offers a range of full and limited-service dining experiences not only in terms of cuisine, that includes a variety of offerings such as burgers, pizza, south-Indian food and street food, but also in terms of the format of offerings including dine-in, cafés, take-away, delivery, and drive thrus. They serve a wide range of customers across various price points.


Presence across key consumption markets with a cluster-based approach:

The company operates 696 stores across all brands and were present in 26 states and 3 union territories across 166 cities in India, as of June 30, 2021. They have a strong presence in key metro regions of Delhi NCR (comprising Faridabad, Ghaziabad, Gurgaon, Delhi and Noida), Bengaluru, Kolkata, Mumbai and Hyderabad. DIL has established a standardized and scalable development model for their stores based on their know-how and experience that has led to faster and more cost-effective roll outs. Their expansion model is supported by streamlined store network planning, a robust supply chain network and an efficient staff recruitment and development program. With the cluster-based expansion approach, they have been able to addresses demand in high-potential domestic markets. The other factors they consider as part of their cluster based approach includes retail presence at a particular location and the brand recognition and recall value of their Core Brands. In assessing the expansion of their store network, they target an optimal mix across different formats, including dine-in, delivery, take-away and drive-thrus. 

Distinguished Board and experienced senior management team:

The Company Board comprises individuals from various fields of finance and business with varied and diverse experience. Ravi Kant Jaipuria, one of the Promoters and Non-Executive Director on the Board, has over 3 decades of experience in conceptualizing, executing, developing and expanding food, beverages and dairy business in South Asia and Africa. The experience of their Independent Directors helps ensure transparency and accountability in their operations across diverse functional aspects and their inputs enhance quality of the operations.

Risk Factors:
Some of the risk factors are as follows

•    The ongoing pandemic Covid19 will adversely impact company’s financial performance and operations because ability or desire of customers to dine in stores, is likely to be uncertain.
•    The company rely on arrangements with Yum for our KFC and Pizza Hut stores that comprise a significant majority of DIL business, and a termination of or inability to renew these arrangements, will have a material adverse effect on company’s business and financial performance.
•    DIL has incurred losses in Fiscals 2019, 2020 and 2021, resulting in erosion of company’s net worth. In the event DIL net loss continues to increase, it may adversely affect the business and financial condition.

How to Apply for an IPO?

  • Login to your 5paisa account and select the issue in the current IPO section

    Login to your 5paisa account and select the issue in the current IPO section

  • Enter the number of lots and price at which you wish to apply for

    Enter the number of lots and price at which you wish to apply for

  • Enter your UPI ID and click on submit. With this, your bid will be placed with the exchange

    Enter your UPI ID and click on submit. With this, your bid will be placed with the exchange

  • You will receive a mandate notification to block funds in your UPI app

    You will receive a mandate notification to block funds in your UPI app

  • You will receive a mandate notification to block funds in your UPI app

    You will receive a mandate notification to block funds in your UPI app

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Frequently Asked Questions

An Initial Public Offering OR IPO is the process of issuing stock for sale for the first time by a private corporation to the public. A company can issue its stock for sale for the first time to raise money by issuing either debt or equity. In case, the company chooses the equity route, the first such offering of equity shares to the public via listing of the shares in the stock markets is called an IPO.

 

This is one of the processes that has to do with the pricing of the IPO. An IPO can be made either through book building method, the fixed price method or a combination of both.

While in book building the price at which securities will be offered/allotted is not known in advance to the investor (investor is aware of an indicative price range only), in the fixed price process price at which the securities are offered/allotted is known in advance to the investor.

When it comes to an IPO, there are 4 types of investors who can bid, as per SEBI guidelines. They are –

  1. Qualified institutional investors (QIIs)
  2. Anchor investors
  3. Retail investors and
  4. High net-worth individuals (HNIs)/Non-institutional investors (NII).

 

IPO subscription period is the period of time during which investors can promise to purchase shares of a security to be issued as initial public offering (IPO).

Check: IPO Application Process

For details about the new IPO application process, click here.

To apply in an IPO with 5paisa:

  • Login to the 5paisa website or mobile trading app
  • Go to the Current IPOs section
  • Select the IPO you wish to apply for
  • Enter IPO details like price, quantity (lots) and your UPI ID
  • Check details and Confirm
  • Approve the UPI notification received on your phone (in BHIM App or your net banking app)

A Red Herring Prospectus, or offer document, is filed by a company to SEBI. This document is very useful to as it provides detailed information about the company’s business operations, financials, promoters and the company’s objective for raising funds.

Contact Details of Devyani International Ltd IPO

Contact Information

Address

Devyani International Limited
F-2/7, Okhla Industrial Area,
Phase-I, New Delhi 110 020


Phone: 011 4170 6720
Email: companysecretary@dil-rjcorp.com
Website: http://www.dil-rjcorp.com/

Devyani International Ltd IPO Lead Manager

Link Intime India Private Ltd
   Link Intime India Private Ltd
   C 101, 247 Park, L.B.S.Marg,
   Vikhroli (West), Mumbai - 400083

Phone: +91-22-4918 6270
Email: devyani.ipo@linkintime.co.in
Website: http://www.linkintime.co.in

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