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Burger King India evaluating IPO to fund growth plans



Private equity investor Everstone Capital recently held discussions with a select few investment banks on the possibility of a Burger King India IPO

MUMBAI: Burger King India Pvt. Ltd, a quick service restaurant (QSR) chain owned by private equity (PE) firm Everstone Capital, is evaluating a potential initial public offering (IPO) to raise growth capital, two people aware of the company’s plans said.

“Everstone Capital is evaluating options to raise growth capital to fund the expansion of Burger King India. They have recently held discussions with a few select investment bankers on the possibility of taking the company public. These are very preliminary talks,” said one of the persons cited above, requesting anonymity as he is not authorized to speak with the media.

Everstone owns and operates Burger King’s branded restaurants across India and Indonesia as part of its F&B Asia Ventures platform.

F&B Asia Ventures is an investment holding company, a pan-Asian food and beverage platform with assets across multiple cuisines, geographies and formats.

It owns and operates several leading brands such as Burger King (India and Indonesia) and Domino’s (Indonesia). The platform also has other brands such as Masala Library, Farzi Café, Pa Pa Ya, Masala Bar, Harry’s, Pind Balluchi, and Duck & Rice.

According to the second person cited above, while the private equity firm has started discussions about a potential public listing of Burger King India, the share sale could still be some time away.

“Despite the pedigree and brand value of Burger King, the Indian operations need more scale to make it very attractive to the public markets. Also, while it is growing fast, the company is yet not profitable,” he said. He too requested anonymity.

According to the company’s filings with the Registrar of Companies (RoC), Burger King India earned a revenue of Rs236.6 crore in 2016-17, up from the previous year’s Rs140.8 crore. However, in the same period, loss increased to Rs62 crore from the previous year’s Rs38.2 crore.

In August 2017, Burger King India crossed 100 outlets in around 28 cities. Its first outlet in India opened in November 2014.

The QSR chain is present in cities such as Delhi-National Capital Region, Mumbai, Pune, Chennai, Hyderabad, Bengaluru, Chandigarh, Ludhiana, Amritsar, Ahmedabad and Kochi.

Everstone Capital declined to comment on Burger King India’s IPO plans.

Several of Everstone’s portfolio companies have gone public in the last couple of years.

On Friday, Everstone Capital-backed non-banking financial company (NBFC) IndoStar Capital Finance Ltd raised Rs1,844 crore through a public offering. The NBFC’s principal lines of business include corporate lending, small and medium enterprise (SME) lending, vehicle and housing financing.

Last year, Everstone Capital-backed education sector focused publishing company S. Chand and Co. Ltd went public in a Rs728.5 crore IPO.

S. Chand delivers content, solutions and services across the education lifecycle, serving the K-12, higher education and early learning segments.

Another Everstone Capital backed company, Hinduja Leyland Finance Ltd, the commercial vehicle financing arm of truck maker Ashok Leyland Ltd is also planning to go public, Mint reported on 28 January.

The Everstone Group is an India and South-east Asia focused PE and real estate investment firm with assets under management of approximately $4 billion.

It has around 200 people working across six offices—Singapore, Mumbai, Delhi, Bengaluru, Mauritius and London.

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