The shares of Devyani International (DIL) tanked 7% to ₹ 182.50 on the BSE on Tuesday’s intra-day trade. Mauritius-based Dunearn Investments Pte Ltd is planning to sell a 2.4% stake in the quick service restaurants chain operator. Dunearn Investments Pte Ltd was among the public shareholders of the company and it holds a 16.26% stake in the company.

Devyani International is the largest franchisee of Yum Brands in India. The company operates more than 655 stores across 155 cities in the country. Some of its famous brands are KFC, Pizza Hut, Costa Coffee, Vaango, and The Food Street.

The shares of the company opened 5.18% lower at ₹185.90 on Tuesday on the BSE. They have been losing for the last four days and shed 11.20% in the period. Its shares are currently trading at ₹ 186.95, down 4.74%.

The exact details of the deal weren’t known immediately, but Kotak Securities was to be the broker for the deal. The price range was fixed at ₹ 182 to ₹196.25 per share and at a 7% discount. The base offer was 2.6 crore shares (2.19% equity), with an upsize option of 87.76 lakh shares (0.73% equity). The total deal size could be USD 80 to 86 million.

Devyani International reported a 100% year-on-year growth in revenue from operations at ₹ 705 crores, up from 353 crores in the corresponding quarter a year ago. The company’s EBITDA rose 167% to ₹ 164 crores within a period of one year. EBITDA stands for earnings before interest, taxes, depreciation, and amortization. Its EBITDA margin stood at 23.3% for the quarter.

Motilal Oswal Financial Services is bullish on the shares and has recommended a buy rating with a target price of ₹ 225 apiece as per its research report dated August 03, 2022. This translates to a 20.35% upside as compared to its current share price.

Written by Simran Bafna

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