Sapphire Foods IPO: KFC operator sets price band of Rs 1,120-1,180 a share

KFC and Pizza Hut operator Sapphire Foods on November 2 has fixed a price band of Rs 1,120-1,180 a share for its initial public offering that will open for subscription on November 9.

The IPO, which will close on November 11, is entirely an offer for sale of 1.75 crore equity shares by shareholders, including promoters QSR Management Trust & Sapphire Foods Mauritius, and investor WWD Ruby.

YUM's largest franchisee in the Indian subcontinent plans to raise Rs 2,073 crore at the upper price band.

The company will not receive funds from IPO as all the money, excluding issue expenses, will go to the selling shareholders.

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Anchor book, if any, will open for a day on November 8.

Investors can bid for a minimum of 12 equity shares and in multiples of 12 shares thereafter.

Retail investors can bid for a minimum Rs 14,160 for a lot and the maximum investment would be Rs 1,98,240 for 14 lots.

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Sapphire Foods started association with YUM in 2015 and it has non-exclusive rights to operate restaurants under YUM's leading brands— KFC, Pizza Hut and Taco Bell.

As of June 2021, it owned and operated 209 KFC restaurants in India and the Maldives, 239 Pizza Hut outlets in India, Sri Lanka and the Maldives, and two Taco Bell restaurants in Sri Lanka. Its number of restaurants grew from 376 as of March 2019 to 450 as of June 2021.

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In 2020, KFC, Pizza Hut and Taco Bell recorded worldwide sales of $26.2 billion, $11.9 billion and $11.7 billion, respectively.

Sapphire Foods narrowed its losses to Rs 99.9 crore in FY21 from a loss of Rs 159.25 crore in the previous year. Revenue from operations during the period dropped from Rs 1,340.41 crore in FY20 to Rs 1,019.62 crore in FY21 due to the COVID-19 crisis.

The key competitors for the company are Devyani International, Jubilant Foodworks, Westlife Development, and Burger King.

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The company will finalise IPO share allotment on November 16 and the funds will be refunded to unsuccessful bidders by November 17.