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Devyani International files for IPO, plans to raise Rs 1,400 crore

Devyani International is the largest franchisee of Pizza Hut, KFC and Costa Coffee

twitter-logoBusinessToday.In | May 17, 2021 | Updated 15:03 IST
Devyani International files for IPO, plans to raise Rs 1,400 crore
Kotak Mahindra Capital Company Ltd, CLSA India Pvt Ltd, Edelweiss Financial Services Ltd and Motilal Oswal Investment Advisors have been appointed investment bankers to the issue. Link Intime India is registrar to the issue.

Devyani International has filed a draft red herring prospectus (DRHP) with market regulator SEBI to launch a Rs 1,400-crore initial public offer (IPO). The firm is the largest franchisee of Pizza Hut, KFC and Costa Coffee.

The share sale will comprise fresh issue of equity shares worth Rs 400 crore and an offer-of-sale (OFS) of up to 12.5 crore equity shares by Investor Selling Shareholder, Dunearn Investments (Mauritius) Pte. Ltd, a wholly owned subsidiary of Temasek Holdings and Promoter Selling Shareholders and RJ Corp Ltd.

Kotak Mahindra Capital Company Ltd, CLSA India Pvt Ltd, Edelweiss Financial Services Ltd and Motilal Oswal Investment Advisors have been appointed investment bankers to the issue. Link Intime India is registrar to the issue.

The firm plans to use the net proceeds of the IPO toward funding of repayment/prepayment of all or certain of the company's borrowings worth Rs 357.8 crore and for general corporate purposes. Devyani is the single-largest quick service restaurant (QSR) company in India to be listed on Swiggy. In 2019 and 2020, the firm was among the largest QSR company in India to be listed on Zomato.

Devyani International started its relationship with Yum in 1997 with its first Pizza Hut store in Jaipur.  As on March 31, 2021 in India, it operated 297 Pizza Hut stores, 264 KFC stores and 44 Costa Coffee outlets.  Between March 2019-2021 the core brand stores saw a CAGR growth of 13.58 per cent from 469 stores to 605 stores . The company has 9,356 employees, according to DRHP.

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Revenue from operations from KFC and Pizza Hut stores together comprised 76.08 per cent, 77.49 per cent and 92.28 per cent of Devyani International's total revenue from operations, in 2019, 2020 and 2021 fiscals, respectively.

The firm is led by Ravi Kant Jaipuria, Promoter, RJ Corp and Virag Joshi, President & CEO. The management team also comprises Manish Dawar, Wholetime Director and Chief Financial Officer, Rajat Luthra, CEO - KFC and Amitabh Negi, CEO - Pizza Hut.

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Devyani International is the third restaurant chain to take the IPO route following the listing of Burger King India and Barbeque-Nation Hospitality. In addition, Mrs Bectors Food Specialities, the largest supplier of buns to QSR chains such as McDonald's, KFC, Burger King and Carl's Jr, also made a stock market debut last year in December.

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