The initial public offering of Travel Food Services Ltd. will open on July 7 and close on July 9. The price band for the IPO is set at Rs 1,045 to Rs 1,100 per share.
Travel Food Services IPO is entirely an offer for sale worth up to Rs 2,000 crore, with no fresh issue component. The face value of each share is Rs 1. Investors can bid for a minimum of 13 shares, and then in multiples thereof. The promoters off-loading their stake is Kapur Family Trust.
Kotak Mahindra Capital Ltd., HSBC Securities and Capital Markets (India) Pvt., ICICI Securities Ltd., and Batlivala & Karani Securities India Pvt., are the book-running lead managers to the issue. Link Intime India Ltd. is the registrar.
The company has filed its Draft Red Herring Prospectus with the Securities and Exchange Board of India to raise up to Rs 2,000 crore through an initial public offering.
IPO Details
Issue opens: July 7.
Issue closes: July 9.
Anchor investor bidding: July 4.
Issue price band: Rs 1,045 to Rs 1,100.
Lot size: Minimum 13 shares and in multiples thereafter.
Total issue size: Rs 2,000 crore (1,81,81,818 shares).
Type: Offer for sale.
Tentative listing date: July 14.
Business
The company's travel quick-service restaurant and lounge businesses span 14 airports in India and three airports in Malaysia. Of the 14 airports in India, 13 rank among the country’s top 15 largest airports by passenger traffic in fiscal 2024. These include major airports such as Delhi, Mumbai, Bengaluru, Hyderabad, Kolkata, and Chennai, as mentioned in company's DRHP.
As of June 30, 2024, the company had a total of 397 Travel QSRs, comprising 335 outlets across 14 airports in India, 30 outlets across two airports in Malaysia and 32 outlets across eight highway sites in India.
Travel Food Services partners with KFC, Pizza Hut, Wagamama, Coffee Bean & Tea Leaf, Jamie Oliver’s Pizzeria, Brioche Doree, Subway and Krispy Kreme on the international front. While regional participants include Third Wave Coffee, Hatti Kaapi, Sangeetha, Bikanervala, Wow Momo, The Irish House, JOSHH, Adyar Ananda Bhavan and Bombay Brasserie. The in-house brands of the company include Caféccino, Dilli Streat, idli.com and Curry Kitchen.
Use Of Proceeds
The company will not receive any proceeds of the offer for sale by the selling shareholders. The entire proceeds from the public offer will be received by promoters who are off-loading their stake.
Anchor Investment
Travel Food Services Ltd. raised Rs 599 crore from anchor investors on Friday ahead of its initial public offering. The company allotted 54.43 lakh shares at Rs 1,100 apiece to 33 anchor investors.
ICICI Prudential Flexicap Fund got the highest allocation of 8.92%. Abu Dhabi Investment Authority- Monsoon and Government Pension Fund Global, Kotak Small Cap Fund got the second highest allotment of 8.85%. Fidelity Advisor Series VIII- Fidelity Advisor Emerging Asia Fund got 6.20% stake each in the company.
Seven domestic mutual funds have applied through 15 schemes. ICICI Prudential, Axis Mutual Fund, Kotak and Whiteoak were among the fund houses in this category, the airport travel QSR said in an exchange filing.
Financial Performance
The company's revenue from operations for the period ended June 30, 2024 stood at Rs 409.86 crore, while the total expenses stood at Rs 354.54 crore. The profit for the quarter that ended in June 2024 stood at Rs 59.54 crore, while the profit for the year ended on March 31, 2024 stood at Rs 59.54 crore.
Key Risk
Taking approvals and adhering to government protocols can become a challenge.
Lounge and airport travel QSR players have to manage airport fees and rentals, operational costs like employee costs, material costs.
Delay in construction of highways or expressways and the seasonal traffic can affect the business as well.
Supply chain and logistical challenges concerning remote locations.
Travel Food Services IPO GMP
The grey market premium for Travel Food Services IPO stood at Rs 30, as of 8:30 a.m. on July 7, according to InvestorGain. That implies listing at premium of Rs 1,130.
GMP or grey market price is not an official indicator and is based on market speculation.
Disclaimer: Investments in initial public offerings are subject to market risks. Please consult with financial advisors and read the red herring prospectus thoroughly before placing bids.
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