Barbeque Nation Hospitality’s Rs 453-crore initial public offering (IPO), which was nearly six times oversubscribed, is expected to list on the stock exchange on Wednesday, April 7, 2021.
This will be the first initial public offering (IPO) in the current fiscal year 2021-22. Last week, the casual dining chain Barbeque-Nation Hospitality completed the share distribution. The issue received bids for 2.99 crore shares against 49.99 lakh shares on offer and was sold in the range of Rs 498-500 per share. Due to global liquidity and a bull market in the domestic stock market, Indian companies earned over Rs 31,000 crore in the previous fiscal year.
Given the recent listings, Vishal Wagh, Head of Research at Bonanza Portfolio Ltd, told Financial Express Online that it is safer to book listing gains and wait for the next chance.
COVID-19 cases are on the rise, and restrictions could harm the value of BBQ stocks.
Analysts conclude that the Barbeque Nation Hospitality listing is doomed due to restrictions imposed in response to rising COVID-19 events, which would disproportionately affect the hospitality and entertainment industries. The hospitality sector appears to be strong in the long run, according to Vishal Balabhadruni, Senior Research Analyst at CapitalVia Global Research, but it appears to be on a bumpy path in the short term.
“BBQ Nation’s stock is expected to list in the 510-512 range. Investors who are only involved in short-term gains can be disappointed, but those who are in it for the long haul will be rewarded. Barbeque-Nation Hospitality is expected to go public amid a surge in corona cases. “We had clearly illustrated the risks of investing in this IPO, which included the cutthroat rivalry in the restaurant industry and the hit restaurants took as a result of lower footfalls,” said Aditya Kondawar, Founder and COO of JST Investments. The problem was given a ‘avoid’ ranking by Kondawar.
Barbeque Nation’s allotted investors must make a profit.
The listing price band is highly overvalued given the current IPO hysteria, according to AR Ramachandran, Co-founder & Trainer, Tips2Trades. Even though the fundamentals of Barbeque Nation remain stable, with demand for QSR seen increasing post-Covid, the listing price band is highly overvalued, according to AR Ramachandran, Co-founder & Trainer, Tips2Trades.
Barbeque Nation and Jubilant FoodWorks are both in the same sector. According to the RHP filed by Barbeque Nation, only Jubilant FoodWorks has a positive P/E ratio of 140.05, out of companies including Westlife Growth, Speciality Restaurants, and Burger King India. The business had 147 Barbeque Nation Restaurants, six International Barbeque Nation Restaurants, and 11 Italian Restaurants as of December 31, 2020.
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