Burger King IPO for Rs 400 crore: McDonald’s rival eyes bigger pie in India market

Burger King eyes a bigger share of India market, with the quick service giant’s India unit files looking to raise Rs 400 crore through an initial public offering. The McDonald’s rival is eyeing a bigger pie of the fast-growing Indian market. Launched in 2014 in India, Burger King operates 202 restaurants, including seven sub-franchised Burger King Restaurants, across 16 states and union territories and 47 cities across India, according to the firm’s DRHP. Notably, the firm aims to have 325 stores by December 31, 2020, up from 202 as of June. McDonald’s had 470 at last count, Reuters reported citing data by consulting firm Technopak Advisors.

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“We also intend to open restaurants in new areas and markets where we believe there is strong potential for growth andWe also intend to open restaurants in new areas and markets where we believe there is strong potential for growth and in addition to taking advantage of the growing online delivery market, including through engagement with delivery aggregators,” the company said in its draft prospectus.

According to the firm’s DRHP, Burger King’s revenue from sale of food and beverages stood Rs 633 crore in FY19, up from Rs 378 crore in the previous fiscal. The firm also recorded a 29% rise in same store sales in the fiscal year. Further, the net loss narrowed to Rs 38.28 crore as compared to Rs 82.23 crore in the previous fiscal year. While the details related to pricing of issue are still awaited, Private equity firm Everstone Capital, which operates Burger King India is considering a private placement of shares worth Rs 150 crore ahead of the IPO, according to the draft red herring prospectus. The public offer comprises of a fresh issue of equity shares aggregating up to Rs 400 crore and an offer for sale of up to 6 crore equity shares by QSR Asia, the promoter.

The shares will be listed on Bombay Stock Exchange as well as the National Stock Exchange. Kotak Mahindra Capital, CLSA India, Edelweiss Financial Services and JM Financial are the book running lead managers to the issue.