Devyani International Limited IPO

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(i) Devyani International is the largest franchisee of Yum Brands in India and are among the largest operators of chain quick-service restaurants in India exclusive basis, and operates 655 stores across 155 cities in India. Yum Brands Inc. operates brands such as KFC, Pizza Hut, and Taco Bell brands and has a presence globally with more than 50,000 restaurants in over 150 countries.

(ii) In addition, it is a franchisee for the Costa Coffee brand and stores in India. Their business is broadly classified into three verticals that include stores of KFC, Pizza Hut and Costa Coffee operated in India stores operated outside India primarily comprising KFC and Pizza Hut stores operated in Nepal and Nigeria and certain other operations in the F&B industry, including stores of their own brands such as Vaango and Food Street Revenue from the Core.

(iii) It began its relationship with Yum in 1997 when it commenced operations of its first Pizza Hut store in Jaipur. In the Core Brands Business, it had an extensive presence in 26 states and three union territories in India as of  2021. It has been consistently expanding its store network over the years. Stores in the Core Brands Business grew from 469 stores in 2019 to 605 stores as 2021. It also works closely with Yum on advertising, promotion, and marketing activities. Costa Coffee, retain flexibility over the operations with respect to similar parameters and is supported by Costa in determining the menu, ingredients, suppliers, and distributors. Raw materials for the operations are sourced from vendors that are pre-approved and meet international safety and quality standards.

Competitive Strengths

(i) Portfolio of highly recognised global brands
(ii) Multi-dimensional comprehensive QSR player
(iii) Quality and Safety
(iv) Digital Adoption

Objects of the Devyani International Limited IPO:

The Offer comprises a Fresh Issue and Offer for Sale -- Fresh Issue of  ₹440 Cr ,Net Proceeds will be utilised in (i) Repayment of all borrowings (ii) General corporate purposes -- Offer for Sale of up to 155,333,330 Equity Shares aggregating up to ₹1,398 Cr

Devyani International Limited IPO Details:

Open Date: Aug 04 2021
Close Date: Aug 06 2021
Total Shares: 155,333,330
Face Value: ₹ 1 Per Equity Share
Issue Size: 1400 Cr.
Lot Size: 165 Shares
Issue Price: ₹ 86-90 Per Equity Share
Listing At: NSE,BSE
Listing Date: Aug 16 2021

Promoters And Management:

(i) Ravi Kant Jaipuria, is a Non-Executive Director of the Company. He is a promoter of the Company and has over three decades of experience in conceptualizing, executing, developing, and expanding food, beverages, and dairy business in South Asia and Africa. He has completed his higher secondary education from Delhi Public School Mathura Road, New Delhi. He has an established reputation as an entrepreneur and a business leader and has received PepsiCo’s award for International Bottler of the Year, awarded in 1997. He was also awarded the ‘Distinguished Entrepreneurship Award’ at the Ph.D. Annual Awards for Excellence 2018. (ii) Varun Jaipuria, is a Non-Executive Director of the Company. He attended Millfield School, Somerset, England, and holds a bachelor’s degree in international business from the Regent’s University, London. He has 12 years of experience in the soft drinks industry and has also completed a program for leadership development at the Harvard Business School. He has been a Director on the Board since November 13, 2009. (iii) Raj Pal Gandhi, is a Non-Executive Director of the Company. He holds a bachelor’s degree in commerce (honors course) from the University of Delhi and was admitted as an associate of the Institute of Chartered Accountant of India in 1981. He has over 28 years of experience with one of our group companies (Varun Beverages Limited) and has been instrumental in strategizing our diversification, expansion, mergers and acquisitions, Capex funding, and institutional relationship. He also has experience in the field of finance and accounts. Prior to this, he has worked with Electronic Trade and Technology Development Corporation Limited and Uptron Powertronics Limited. He has been a Director on the Board since August 13, 2007. (iv) Virag Joshi, is the Whole-time Director (President & CEO) of the Company. He holds a diploma course in hotel management and catering from the State Institute of Hotel Management and Catering, Lucknow, Uttar Pradesh. He has been a key strategist in the expansion of Pizza Hut, KFC, Costa Coffee outlets from a small base of five restaurants in 2002 to 600 plus outlets in the last 19 years. He has been earlier associated with Indian Hotels Company Limited, Domino’s Pizza India Limited, Milkfood Limited, and Priya Village Roadshow Limited. He has been a Director on the Board since November 10, 2004.

Financials of Devyani International Limited IPO:

Particulars (Million) Mar 21 Mar 20 Mar 19
Revenue 11,348 15,163 13,105
Cost of material consumed 3,386 4,487 3,772
Purchases of Stock 59 116 115
Impairment of non-financial assets 480 38 247
Employee Benefit Expenses 1,543 2,254 1,915
Other Expenses 4,089 5,750 4,511
Operating Profit 1,791 2,518 2,545
OPM % 15.78% 16.61% 19.42%
Other Income 640 186 130
Depreciation & Amortisations 2,294 2,233 2028
Financial Cost 1,528 1,584 1,356
Profit Before Tax -823 -769 -579
Net Profit -577 -1071 -972
NPM% -5.08% -7.06% -7.42%

Comparison With Peers:

As per RHP, Devyani International has shown Jubilant Foodworks, Westlife Development and Burger King as its listed peers. They are currently trading at a P/E of around 133.56, NA and NA. However, business of Jubilant which is into pure Pizza and MacD and Burger King are into pure burgers can't be compared fully with Brands like KFC and Pizza Hut.

Recommendation on Devyani International Limited IPO:

Review and Recommendation of Devyani International IPO from InvestorZone is 4/10 1. Devyani International has brand like KFC and Pizza Hut. However, the competition from Dominos in Pizza market is huge and has completely dominated the market from last few years. For KFC, the management says they don't have any competition but unorganised market which is serving chicken is huge and have big competition. 2. The Balance Sheet looks weak for Devyani International. In 2019,  Auditor mentioned that the Group and its Joint Venture’s current liabilities exceed its current assets as of March 31, 2019. These conditions indicate the existence of material uncertainty that may cast significant doubt about the Group and its Joint Venture’s ability to continue as a going concern. Plus their net-worth was completely eroded in 2019. 3. Valuation looks stretched as compared to Burger King or Jubilant Food considering their growth. Burger King currently trading at Mcap/Sales of 8.2x, Jubilant Foods at 12.5x and Devyani is asking 8x...Nothing much left on table for investors. 4. However, having said that, the market is in bull run and these IPO can be played for listing gain.

Registrar of Devyani International Limited IPO:

  1. Link Intime India Private Limited

Company Address:

F-2/7, Okhla Industrial Area, Phase-I, New Delhi 110 020, India Tel: 011 4170 6720 Website:

Discussion on Devyani International Limited IPO:


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