Barbeque Nation IPO opens today – the company will be counting on its popularity and presence in India

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Barbeque Nation IPO opens today – the company will be counting on its popularity and presence in India
Indian casual dining chain Barbeque Nation Hospitality’s initial public offering (IPO) issues start today (March 24).Barbeque Nation
  • Indian casual dining chain Barbeque Nation Hospitality’s initial public offering (IPO) issue starts today (March 24).
  • The company, which operates the Indian restaurant chain Barbeque Nation and Italian chain Toscano, is looking to raise ₹180 crore from fresh issue of shares.
  • Analysts are betting on the company’s growth over the years, its presence across India and its dominance in the Indian cuisine hospitality market.
Indian casual dining chain Barbeque Nation Hospitality’s initial public offering (IPO) starts today (March 24). Barbeque Nation’s IPO follows the successful public market offerings of companies in the food sector in India – Burger King and Mrs Bector’s.

The company, which operates the Indian restaurant chain Barbeque Nation and Italian chain Toscano, is looking to raise ₹180 crore from fresh issue of shares and an offer for sale up to 54.5 lakh shares.

Issue opensMarch 24
Issue closesMarch 26
Price band₹498-500 per share
Market lot30 shares
Minimum order value₹15,000

And analysts are betting on the company’s growth over the years, its presence across India and its dominance in the Indian cuisine hospitality market.
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A name to reckon with



Barbeque Nation is not a new name in the industry. From presence in top metros to smaller cities, the restaurant chain is quite popular across the country. The company has grown from a single outlet in 2008 to over 160 restaurants across 77 cities in India and six international restaurants.

“One of the main contributors to the brand affinity of Barbeque Nation Restaurants has been referrals and recommendations by its customers, which has enabled it to retain a strong market position whilst steadily expanding across India in a fragmented and highly competitive industry,” said a report by HDFC Securities.
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But Barbeque Nation is a pioneer in the buffet concept which remains a hit among the crowds. “Their fixed price ‘all you can eat’ concept at their Barbeque Nation Restaurants offers their customers a varying spread of consistently delicious food at a value-oriented price in a pleasant and casual dining environment,” said a report by Axis Capital.

Adapted to COVID-19 quickly



With the COVID-19 pandemic and the subsequent nationwide lockdown, Barbeque Nation saw its business being completely shut in April and May, last year. But, the company innovated to bring about a new delivery offering – Barbeque in a Box and launched it in June 2020. In an interview with Business Insider, Rahul Agrawal, chief executive officer of Barbeque Nation, had said that the delivery business is already contributing in double digits to its total revenue.
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According to the HDFC Securities report, as of December 31, 2020, the average rating of Barbeque Nation Restaurants on an online food aggregator was 4.38 out of 5.00.

Proven track record but losses are worrying



Barbeque Nation’s revenue has grown consistently over the years, but its mounting losses are also a cause of concern.
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Barbeque Nation IPO opens today – the company will be counting on its popularity and presence in India
BI India

While in April and May (of 2020) there was barely any business, eventually, the company claims that the growth started from June and by November (of 2020), their business was at 84% of 2019’s November numbers.

Barbeque Nation in a pre-IPO round raised ₹150 crore from Xponentia Capital, founded by private equity veteran Ajay Relan, and Jubilant Foodworks, the parent company of Domino’s Pizza in India. It is also backed by CX Capital, a PE firm, and Alchemy Capital, the investment firm headed by ace stock market expert Rakesh Jhunjhunwala.

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Expansion will help



As things stabilise, the company also plans to get back to its expansion plans, having more than doubled from 80 restaurants in FY17 to over 160 restaurants now. “We will also focus majorly on the new delivery vertical,” Agrawal had told Business Insider.

“Increasing their penetration in existing cities with a greater number of restaurants will enable them to access new catchment areas within these cities and optimise their infrastructure usage,” said the Axis Capital report.

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With an IPO on its plate, Barbeque Nation hopes to clear off some of its debt and double down on not just dining but its new delivery business



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