Barbeque-Nation IPO itemizing day technique: COVID-19 restrictions might damage BBQ shares debut; promote or maintain?


Barbeque Nation Hospitality can be the primary IPO itemizing within the new monetary 12 months 2021-22

Barbeque Nation Hospitality’s Rs 453-crore IPO, which was subscribed almost 6 occasions, is more likely to make its inventory market debut on Wednesday, April 7, 2021. This is able to be the primary IPO itemizing within the new monetary 12 months 2021-22. The informal eating chain Barbeque-Nation Hospitality has finalised the share allotment final week. The difficulty was bought within the vary of Rs 498-500 per share, and obtained bids for two.99 crore shares in opposition to 49.99 lakh shares on provide. Within the earlier fiscal, Indian corporations raised over Rs 31,000 crore pushed by world liquidity and bull run within the home inventory market.

Vishal Wagh, Head of Analysis, Bonanza Portfolio Ltd, instructed Monetary Categorical On-line that seeing the current listings, it’s higher to e-book itemizing positive aspects and await the following alternative. Barbeque-Nation is the nation’s main informal eating restaurant (CDR) chain (when it comes to outlet rely as of September 30, 2020), and Worldwide Barbeque Nation Eating places. The corporate owns and operates Toscano Eating places and UBQ by Barbeque Nation Restaurant.

Rising COVID-19 instances, restrictions might damage BBQ shares itemizing

Analysts imagine that Barbeque Nation Hospitality itemizing appears to be gloomy on the again of restrictions in response to rising COVID-19 instances, as it is going to hit the hospitality and leisure sectors probably the most. Vishal Balabhadruni, Senior Analysis Analyst at CapitalVia International Analysis, instructed Monetary Categorical On-line, that the Hospitality sector appears good in the long run, nonetheless, within the short-term, it appears to be on a bumpy highway. “Shares of BBQ Nation are anticipated to listing within the vary of 510-512. Buyers solely in itemizing positive aspects could also be disenchanted however traders who’re in it for the long run should maintain their positions,” he added.

Barbeque-Nation Hospitality shares are set to listing amid spiking corona instances. “We had clearly highlighted the dangers of investing on this IPO which included the cut-throat competitors within the restaurant enterprise and the hit taken by eating places as a consequence of decrease footfalls,” stated Aditya Kondawar, Founder, COO, JST Investments. Kondawar had given a ‘keep away from’ score to the difficulty.

Allotted traders should e-book revenue in Barbeque Nation

Despite the fact that fundamentals of Barbeque Nation stay regular with demand for QSR seen rising put up Covid, the itemizing value band is very overvalued given the present IPO frenzy, stated AR Ramachandran, Co-founder & Coach, Tips2Trades. “On the itemizing day, allotted traders ought to e-book substantial revenue and await a 20-30 per cent correction to re-enter the inventory at extra affordable valuations,” he instructed Monetary Categorical On-line.

Jubilant FoodWorks operates in the identical business as Barbeque Nation. Among the many likes of Westlife Growth, Speciality Eating places and Burger King India, solely Jubilant FoodWorks has a constructive P/E ratio of 140.05, in response to the RHP filed by Barbeque Nation. As of December 31, 2020, the corporate had 147 Barbeque Nation Eating places, six Worldwide Barbeque Nation Eating places and 11 Italian Eating places of which 9 are operated underneath ‘Toscano’ model identify and one every underneath the model names ‘La Terrace’ and ‘Collage’. respectively.

(The suggestions on this story are by the respective analysis and brokerage agency. Monetary Categorical On-line doesn’t bear any duty for his or her funding recommendation. Please seek the advice of your funding advisor earlier than investing.)

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