Forensic Analyst, Trudence Capital Advisors

Nitin Mangal

Forensic Analyst

Trudence Capital Advisors

Trudence Capital Advisors Private Limited is a SEBI-registered Research Analyst, holding SEBI registration number INH000015747. Our firm is dedicated to providing independent and unbiased research on Indian mid to large-cap companies. Trudence Capital is known for its counter-consensus views, with a focus on forensic research and on-ground primary investigations. Our research approach is thorough, involving detailed analysis of accounting practices and governance, alongside extensive channel checks.

Independent & Unbiased Research

Forensic Accounting

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<li>
<a href="https://www.smartkarma.com/entities/barbeque-nation-hospitality-ltd" target="_blank" data-smartkarma-citation="entities:28868:1" rel="noopener">Barbeque Nation Hospitality (0823884D IN)</a> is among the largest casual dining chains in the country, and its been a year since it got listed on the bourses. </li>
<li>In our earlier insight <a href="https://www.smartkarma.com/insights/barbeque-nation-ipo-not-grilling-fine" target="_blank" data-smartkarma-citation="insights:49603" rel="noopener">Barbeque Nation IPO: Not Grilling Fine</a> , we had highlighted the business, financial and governance discomforts seen in the IPO document.</li>
<li>A year later, these setbacks still continue to be visible in the balance sheet. In this insight, we try to update our insights regarding the company.</li>
</ul>



Barbeque Nation Hospitality (0823884D IN) is among the largest casual dining chains in the country, and its been a year since it got listed on the bourses. 
In our earlier insight Barbeque Nation IPO: Not Grilling Fine , we had highlighted the business, financial and governance discomforts seen in the IPO document.
A year later, these setbacks still continue to be visible in the balance sheet. In this insight, we try to update our insights regarding the company.


Barbeque Nation Update: Discomforts Still Prevalent

Equity Analyst, LightStream Research

Oshadhi Kumarasiri

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Equity Capital Markets

Devyani International / Equity Capital Markets

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<li>
<a href="https://www.smartkarma.com/entities/devyani-international-ltd" target="_blank" data-smartkarma-citation="entities:33519:1" rel="noopener">Devyani International (6590204Z IN),</a> franchisee of Pizza Hut, KFC and Costa Coffee restaurants in India, is expected to start trading on the 16th of August 2021. The IPO was oversubscribed by 116.7x at INR 90.0 per share. The grey market premium has held steady at INR 51.0 over the last three days indicating that the shares could open at around INR 141.0 per share which implies a listing gain of around 57%.</li>
<li>The company has collected around INR 8.3bn (45% of the total offer) at INR 90.0 per share from 41 anchor investors including Abu Dhabi Investment Authority, Fidelity, Goldman Sachs, Monetary Authority of Singapore, Abu Dhabi Investment Council, Government of Singapore, Jupiter Asset Management, Nomura and Macquarie.</li>
<li>Moreover, the company has attracted a lot of retail investors, as the retail offer and non-institutional offer were oversubscribed around 39.5x and 213.1x respectively.</li>
</ul>



Devyani International (6590204Z IN), franchisee of Pizza Hut, KFC and Costa Coffee restaurants in India, is expected to start trading on the 16th of August 2021. The IPO was oversubscribed by 116.7x at INR 90.0 per share. The grey market premium has held steady at INR 51.0 over the last three days indicating that the shares could open at around INR 141.0 per share which implies a listing gain of around 57%.
The company has collected around INR 8.3bn (45% of the total offer) at INR 90.0 per share from 41 anchor investors including Abu Dhabi Investment Authority, Fidelity, Goldman Sachs, Monetary Authority of Singapore, Abu Dhabi Investment Council, Government of Singapore, Jupiter Asset Management, Nomura and Macquarie.
Moreover, the company has attracted a lot of retail investors, as the retail offer and non-institutional offer were oversubscribed around 39.5x and 213.1x respectively.


Devyani International IPO: First Day Trading

United Foodbrands / Equity Capital Markets

<a href="https://www.smartkarma.com/entities/barbeque-nation-hospitality-ltd" target="_blank" data-smartkarma-citation="entities:28868:1" rel="noopener">Barbeque Nation Hospitality (0823884D IN)</a> or BBQ Nation (BNHL), in one of the last IPOs for Fiscal 2021, plans to raise INR 4.5 bn from public which consists of fresh issue worth INR 1.8 bn and offer for sale worth INR 2.7 bn.
BNHL is one of the largest casual dining chain in the country, with a portfolio of 147 BBQ Nation Restaurants across 77 cities in India and 6 international outlets. The company also operates 9 restaurants and 11 restaurants under the brands 'Toscano' and 'UBQ by Barbeque Nation'.
The chain casual dining market has thrived in the last few years and so did the company, as its topline has expanded at % CAGR from F18-F20. However, the pandemic has completely shifted the ball game throughout the industry; for a company that was already loss-making, the main problem would be value generation given subdued expected recovery due to the second wave. 
In this insight, we focus on some of the balance sheet and a lot of governance cautions, mainly on the promoter profile that one should consider before taking any action on the stock. Like always, we do not comment on the valuation of IPO.

Barbeque Nation Hospitality (0823884D IN) or BBQ Nation (BNHL), in one of the last IPOs for Fiscal 2021, plans to raise INR 4.5 bn from public which consists of fresh issue worth INR 1.8 bn and offer for sale worth INR 2.7 bn.
BNHL is one of the largest casual dining chain in the country, with a portfolio of 147 BBQ Nation Restaurants across 77 cities in India and 6 international outlets. The company also operates 9 restaurants and 11 restaurants under the brands 'Toscano' and 'UBQ by Barbeque Nation'.
The chain casual dining market has thrived in the last few years and so did the company, as its topline has expanded at % CAGR from F18-F20. However, the pandemic has completely shifted the ball game throughout the industry; for a company that was already loss-making, the main problem would be value generation given subdued expected recovery due to the second wave. 
In this insight, we focus on some of the balance sheet and a lot of governance cautions, mainly on the promoter profile that one should consider before taking any action on the stock. Like always, we do not comment on the valuation of IPO.

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Barbeque nation (BN) aims to raise around US$150m in its India IPO. It owns and operates casual dining restaurants under the same name, Barbeque Nation Restaurants. As of Nov 2019, it had 138 restaurants  in 73 cities in India and seven international restaurants in three other countries.The company had tried to list earlier in FY17 but was held back due to regulatory reasons. Hence, one has a longer financial history available for the company. The number of restaurants operated by the company has increased by 4x over FY13-19. This has led to strong revenue growth. However, EBITDA and PATMI have lagged revenue growth even though the cost of foods and beverages as a percentage of revenue has been declining. The pressure of margins appears to stem from rising employee costs.Even on a per restaurant basis, revenue, EBITDA and operating cash flow has been declining. Furthermore, the company recently acquired a group of Italian restaurants in order to diversify its offering. The last time it tried to diversify, it didn’t end up doing too well.

Barbeque nation (BN) aims to raise around US$150m in its India IPO. It owns and operates casual dining restaurants under the same name, Barbeque Nation Restaurants. As of Nov 2019, it had 138 restaurants  in 73 cities in India and seven international restaurants in three other countries.The company had tried to list earlier in FY17 but was held back due to regulatory reasons. Hence, one has a longer financial history available for the company. The number of restaurants operated by the company has increased by 4x over FY13-19. This has led to strong revenue growth. However, EBITDA and PATMI have lagged revenue growth even though the cost of foods and beverages as a percentage of revenue has been declining. The pressure of margins appears to stem from rising employee costs.Even on a per restaurant basis, revenue, EBITDA and operating cash flow has been declining. Furthermore, the company recently acquired a group of Italian restaurants in order to diversify its offering. The last time it tried to diversify, it didn’t end up doing too well.

Barbeque Nation Pre-IPO - Not Really a Feast

India

United Foodbrands Limited is an India-based casual dining restaurant company that operates a chain of restaurants primarily under its flagship brand, Barbeque Nation, offering an 'over-the-table barbeque' concept. The company also manages other brands like Toscano and Salt, expanding into premium casual dining and international markets. It was incorporated in 2006 and is headquartered in Bengaluru, Karnataka, India.

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United Foodbrands (UFBL IN)

Barbeque Nation Update: Discomforts Still Prevalent

In our earlier insight we had highlighted the business, financial and governance discomforts seen in the IPO document. A year later, BBQ Nation is...

Nitin Mangal

Devyani International IPO: First Day Trading

If shares open at around INR 141.0 per share (based on the grey market premium), Devyani International would be valued at 14.2x FY21 revenue...

Oshadhi Kumarasiri

Barbeque Nation IPO: Not Grilling Fine

In this insight, we focus on some of the balance sheet and a lot of governance cautions, mainly on the promoter profile that one should consider...

Nitin Mangal

Barbeque Nation Pre-IPO - Not Really a Feast

Barbeque nation (BN) aims to raise around US$150m in its India IPO. It owns and operates casual dining restaurants under the same name, Barbeque...

Sumeet Singh

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