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KFC operator Sapphire Foods IPO subscribed 23%; retail investors portion booked 1.23 times –

Sapphire Foods aims to raise Rs 2,073 crore through public issue. It mopped up Rs 933 crore from anchor investors on November 8.

Sapphire Foods, which operates KFC and Pizza Hut, recorded 23 percent subscription for its public issue on its debut today with bids for 21.90 lakh equity shares against an offer size of 96.63 lakh. The issue closes on November 11.

Retail investors have put in bids for 1.23 times of shares reserved for them.

The portions for non-institutional investors booked only 1 percent, while qualified institutional buyers portion have not yet received bids.

Sapphire Foods aims to raise Rs 2,073 crore through the public issue. It mopped up Rs 933 crore from anchor investors on November 8. The offer size was reduced to 96.63 lakh equity shares, from 1.75 crore shares after fundraising via anchor book.

The IPO is entirely an offer-for-sale by promoters and investors, so the company will not receive funds from the IPO.

The price band for the offer has been fixed at Rs 1,120-1,180 per equity share.

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Sapphire Foods India is one of YUM’s franchisee operators in the Indian subcontinent. It is also Sri Lanka’s largest international QSR (quick service restaurant) chain in terms of revenue and number of restaurants operated as of March 2021. It has also established a presence in the Maldives.

Marwadi Financial Services assigned ‘subscribe’ rating to this IPO as the company is a leading QSR brand with a substantial market presence and has a scalable new restaurant economic model for expansion. Also, “it is available at reasonable valuation compared to its peers”.

The company has differentiated product offerings with KFC, Pizza Hut and Taco Bell as a market leader in chicken, pizza and Mexican-inspired food, respectively.

As of June 2021, Sapphire owned and operated 209 KFC restaurants in India and the Maldives, 239 Pizza Hut restaurants in India, Sri Lanka and the Maldives, and two Taco Bell restaurants in Sri Lanka.

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