Nine things you should know about Sapphire Foods IPO
The price band for the KFC and Pizza Hut outlets operator has been fixed at Rs 1,120 – 1,180.
Samara Capital-backed largest franchisee of Yum Brands in the Indian subcontinent Sapphire Foods will hit Dalal Street on November 09 to raise Rs 2,073.25 crore through its IPO (initial public offering). Read on to know all the details about the issue:
Open and close date: The offer will open for subscription on November 09 and the bidding will close on November 11. The anchor book, if any, will open for a day prior to the issue, i.e. November 08.
Price band: The price band for the KFC and Pizza Hut outlets operator has been fixed at Rs 1,120 – 1,180 having a face value of Rs 10 per share.
Lot size: Investors can bid for a minimum of 12 equity shares and in multiples, thereafter, translating to a minimum bidding amount of Rs 14,160 at the higher end of the price band. A retail investor can at max apply for 14 lots or 168 shares for Rs 1,98,240.
Issue size: The Rs 2,073.25-crore public offer is entirely an OFS (offer for sale) by existing shareholder
The OFS comprises up to 850,000 shares by QSR Management Trust, 5.57 million shares by Sapphire Foods Mauritius, 4.85 million shares by WWD Ruby, 3.96 million by Amethyst, 80,169 shares by AAJV Investment Trust, 1.62 million shares by Edelweiss Crossover Opportunities Fund and 646,000 shares by Edelweiss Crossover Opportunities Fund Series II.
Objective of issue: Since the entire is an OFS none of the proceeds will be reflected on companies book.
What’s in it for retail investors: Not more than 75% of the total offer has been reserved for qualified institutional buyers, up to 15% for retail investors, and the rest 10% for non-institutional buyers.
About the company: Sapphire Foods India is YUM brand’s largest franchise operator in the Indian subcontinent in terms of revenue as of FY’20. It is also Sri Lanka’s largest international QSR chain in terms of revenue for FY’ 2021 and the number of restaurants operated as of March 31, 2021. As of March 31, 2021, the company owned and operated 204 KFC restaurants in India and the Maldives, 231 Pizza Hut restaurants in India, Sri Lanka and the Maldives, and 2 Taco Bell restaurants in Sri Lanka. The company’s total number of restaurants in the subcontinent region grew from 376 in 2019 to 437 in 2021.
On the financial front, net loss of the company widened to Rs 99.89 crore for the year ended FY21 compared to Rs 69.40 crore in FY19. Whereas its total revenues slipped to Rs 1,081.23 crore versus Rs 1,206.28 crore during the same period. For the quarter ended June 2021, the company posted a loss of Rs 26.40 crore on a revenue of Rs 313.92 crore.
Book running lead managers and registrar to the IPO: The book running lead managers to the issue are BofA Securities India, ICICI Securities, IIFL Securities and JM Financial Consultants. The registrar to the issue is Link Intime.
Issue timeline: The issue is likely to finalize the basis of allotment by November 16, and the initialization of refunds will take place by November 17. While the credit of equity shares to depository accounts of the allottee will be done on November 18. The quick-service restaurant operator is expected to make its stock market debut on November 22, 2021.