Burger King India gets SEBI nod for IPO

Burger King India Ltd, the national master franchisee of American burger brand in India, has received a green signal from Securities and Exchange Board of India (SEBI) to float its Initial Public Offering (IPO).


SEBI issued its final observations on Burger King India’s IPO proposal on January 24, according to the capital market regulator’s website.


The proposed IPO will involve private equity firm Everstone selling a quarter of its shares and the burger chain issuing fresh shares worth Rs 400 crore. The total IPO size is estimated at Rs 1,000 crore ($141 million). Everstone hopes to make neat returns from the partial exit. Burger King India plans to roll out 700 restaurants by 2025 from 216 at present.

Apart from higher growth, several other parameters work in favour of Burger King India. For instance, it has a pan-India licence. The average store size of Burger King India is around 1,300-1,400 square feet, half or even lesser than the average store size of McDonald. Until now, Burger King has focussed more on having its stores in the malls. Approximately, 60 per cent of its restaurants are in the malls. Lower store sizes and better cost management has helped the company maintain financial ratios at par, despite having cheaper average product prices. Industry experts cite flexibility in terms of supply chain, store formats and menu as reasons for Burger King to stay one step ahead.