Shares of Barbeque Nation Hospitality surged 20 per cent on the stock market after listing at a discount of 2 per cent on its issue price on Wednesday. This development came as a surprise to many investors and analysts as the shares of the company were trading weaker on the grey market a day before the listing.
The shares of the casual dining restaurant chain listed on the National Stock Exchange at Rs 489.85 — a 2.03 per cent discount on its issue price of Rs 500. However, the stock surged 20 per cent to Rs 587.80 on the NSE at around 10:40 am. At least 53.14 lakh shares of the dining chain changed hands on the NSE.
Meanwhile, the stock made its debut at Rs 492 on the BSE, down 1.6 per cent. It surged 20 per cent to Rs 590.94 at around 10:40 am.
Barbeque Nation Hospitality IPO
The company, backed by ace investor Rakesh Jhunkhunwala raised Rs 453 crore from its IPO that opened for subscription from March 24 to March 26. The allotment of shares was finalised on April 1.
The company’s public issue was subscribed 5.98 times on its closing day on March 26. The issue received bids for 2.99 crore equity shares against the offer size of 49.99 lakh equity shares. It was subscribed 13.13 times by retail investors, while non-institutional investors subscribed 3.10 times.
The minimum lot size for subscribing to the issue was 30. Investors who bid for one lot of the IPO had to spend Rs 15,000, considering the Rs 498-Rs 500 price band per share.
The IPO comprised a fresh issue of shares worth Rs 180 crore and an offer-for-sale of more than 54 lakh equity shares, amounting to Rs 272.87 crore. Shares worth Rs 2 crore were reserved for eligible employees.
The company plans to use the proceeds from the IPO to fund capital expenditure for expansion and opening new restaurants. A portion of it will also be used for prepayment and repayment of certain borrowings and expenses related to general corporate purposes.