Barbeque Nation trades at an 18.08% premium, book listing gains, say analysts

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Rakesh Jhunjhunwala-backed casual dining chain Barbeque Nation Hospitality opened at Rs 489.85 per share on the National Stock Exchange, marking a discount of 2.03% from the IPO price of Rs 500 per share. On the BSE, the restaurant operator opened at Rs 492, a markdown of 1.60%.

With the status quo maintained by the RBI market sentiments improved. In noon trades, the share rebounded and was trading at Rs 590.40 gaining 18.08% or Rs 90.40 over the issue price. It made an intraday high of Rs 590.40 and a low of Rs 481.35, on the BSE.

Rajesh Agarwal, Head of Research at AUM Capital, is of the opinion that investors should book listing gains as past financial performance is not good as well as the second wave of COVID-19 and related lockdown will further add pressure on its finances.

Barbeque Nation Hospitality is one of India’s leading casual dining restaurant chains, which owns and operates Barbeque Nation Restaurants and International Barbeque Nation Restaurants. It also owns and operates Toscano Restaurants and UBQ by Barbeque Nation Restaurant.

On a consolidated basis, the company reported a net loss of Rs 100.65 crore and revenue of Rs 201 crore in the eight months ended on November 30, 2020.

“The company have incurred losses in some of the recent fiscals and looking at the current covid situations there is no assurance that net profit will not decline in future. Investors of this IPO are advised to exit from the company,” said Saurabh Joshi – Research Analyst, Marwadi Shares and Finance.

The Rs 452.87-crore initial public offer of the company got subscribed 5.98 times on the last day of the offer. The company received 2.99 crore shares as against 49.99 lakh shares on offer, according to the stock exchange data. The qualified institutional buyers (QIBs) category was subscribed 5.11 times. The retail individual investors category was subscribed 13.13 times. The non-institutional investors category was subscribed 3.10 times.

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