Recent Trending Indian IPOs

Consumer
Discretionary
Topics to be discussed
01 Sector Overview

02 Introduction to the Companies and Business

03 Financial Details of the Company

04 Details about IPO-Fresh/OFS

05 Historical Valuation of the Company

06 Valuation at the time of IPO and post listing

07 Forward Valuation

08 Constrast between companies

09 Summary & Recommendations

Sector Overview
Consumer discretionary is a sector classification of non-essential consumer goods and services watched by
analysts and investors.
Consumers tend to spend more on consumer discretionary products in economic growth phases, which are
usually characterized by higher disposable income.
Consumer discretionary goods are typically much more elastic than that of consumer staples. This means that
consumers’ ability to spend on consumer discretionary products is directly tied to their income.
Due to the outbreak of Covid-19, a forced recession occurred in 2020. Stock prices drastically declined during
March and April of 2020. Since then, the stock market has been improving drastically. This indicates that the
economy is indeed making its shift from recession to early expansion. This is good news for the consumer
discretionary sector.
This sector has a total market cap of $8.99 trillion, up from last year’s $6.84 trillion. For the consumer
discretionary sector as a whole, revenue growth is at 17.42% as of February 19, 2021. Earnings per share growth
is at 29.88%.
As of February 19, 2021, the Consumer Discretionary sector has performed well compared to the S&P 500 index
in terms of one-year total return. This sector has offered returns of 30.56%, as opposed to the S&P 500’s one-
year return of only 15.58%.
 Zomato Profit & Loss Statement Figures in Cr.

Zomato, as a company, was incorporated in the

year 2010, making it one of the youngest mega
startups in the country to go for a public issue.
Zomato was founded as Foodiebay in 2008, and
was renamed Zomato on 18 January 2010 as
Zomato Media Pvt. Ltd.
Zomato ensures prompt doorstep delivery. In
addition to food delivery, Zomato also offers
dining-out and table booking services in the B2C
segment.
The company also provides an exclusive paid Balance Sheet Figures in Cr.
membership service to customers through the
Zomato Pro program that offers discounts and
other privileges at partner restaurants.
 Profit & Loss Statement Figures in Cr.
Burger King
Quite well-known throughout the world, the brand
‘Burger King’ has been in existence since 1954.
It was originally founded in 1954 in the United
States. Owned by Restaurant Brands International
Inc., it is currently the second-largest fast-food
burger brand across the world.
Burger King was incorporated in India in the year
2013 as a private limited company. It was then
subsequently converted to a public limited
company in the year 2019.
Their first ever restaurant in India was opened in
Balance Sheet Figures in Cr.
November, 2014. And since then, the company
has grown tremendously and now owns around
202 restaurants across 47 cities in India as of 30
June, 2019.
The total size of the IPO is about Rs. 810 crores
Through the IPO, Burger King India intends to sell
7.5 crore shares and raise an amount of Rs. 450
crores. This will be primarily used for expansion
purposes.
 Kalyan Jewellers Profit & Loss Statement Figures in Cr.

Kalyan Jewellers was founded by T. S.

Kalyanaraman, who opened the first jewellery
showroom in 1993 in Thrissur, Kerala, India with
an initial capital of ₹7.5 million. Formally
incorporated in the state of Tamil Nadu in the
year 2009.
In 2013, Kalyan Jewellers entered International
markets by opening six showrooms on the same
day in UAE. As of February, 2020 Kalyan
Jewellers has a wide presence of over 137
showrooms, of which 107 are in India and the Balance Sheet Figures in Cr.
remaining 30 on the Middle East.
Kalyan Jewellers is an Indian chain of jewellery
showrooms. It has presence across major cities
in the country and in West Asia with a workforce
strength of over 8,000 employees.
The company also has strong roots in the textile
trading, distribution and wholesale business.
IPO Details
Historical Valuation
Zomato
Historical Valuation
Burger King
 Historical Valuation
Kalyan Jewellers India Ltd.
Valuation at the time of IPO
Forward Valuations
Values in Cr.
 CONTRAST BETWEEN COMPANIES IN THE SECTOR
India’s leading food delivery startup
LISTING Zomato made a stellar debut on Dalal
Street on July 23 as the stock opened at
GAINS Rs 116 on the NSE, a 52.63 percent
premium to its final offer price of Rs 76.
The listing price on the Bombay Stock
Exchange was Rs 115, up 51.32 percent.
IPO Zomato IPO subscribed 38.25 times.
The public issue subscribed 7.45
SUBSCRIPTION times in the retail category, 51.79
times in QIB, and 32.96 times in the
NII category.
Company proposes to utilise the Net
Proceeds towards the following objects:
1. Funding organic and inorganic
UTILIZATION OF growth initiatives.
NET PROCEEEDS 2. General corporate purposes.
Burger King listed at Rs 115.35 on the
Bombay Stock Exchange (BSE), up 92 per
cent over theissue price,closing at Rs
138.40, A 130 percent premium over its
issue price of Rs 60.
Burger King IPO subscribed 156.65
times. The public issue subscribed
68.15 times in the retail category,
86.64 times in QIB, and 354.11 times
in the NII category.
The Net Proceeds from the Fresh Issue
are proposed to be utilised in the
following manner:
1. Funding roll out of new Company-
Owned Burger King Restaurants.
2. General corporate purposes.
Kalyan Jewellers had a disappointing
market debut, with the share price
falling 16 percent. The stock listed at
Rs 73.9 on the BSE, a 15 percent
discount to the issue price Rs 87.
Kalyan Jewellers IPO subscribed 2.61
times. The public issue subscribed
2.82 times in the retail category, 2.76
times in QIB, and 1.91 times in the
NII category.
The Net Proceeds from the Fresh
Issue are proposed to be utilized
towards the following objects:
1. Funding working capital
requirements of our Company.
2. General corporate purposes.
 Summary & Recommendations
Zomato saw its revenues doubling from the past year to $394 million in FY20. These numbers were $192 million last
year, signalling an impressive jump.There are three major growth drivers. One is, of course, the increased smartphone
penetration which will get more users on to the platform. The second growth driver is penetration into Tier-II and Tier-
III markets. The third growth driver is increased frequency. In metro cities, the penetration of online food delivery is
somewhere close to 60-70%. So the only way to get growth in the top 10 cities would be increased frequency. Zomato
has been able to reduce its losses in FY2021 despite a degrowth in topline. It expect losses to reduce further over next
couple of years due to rebound in growth and improving unit economic.

Burger King India is on the verge of breakeven. It is anticipated that the company can incur a final loss in 2022, before
generating positive profits of ₹143m in 2023. Therefore, the company is expected to breakeven roughly 2 years from
today. Burger King India has no debt on its balance sheet, which is quite unusual for a cash-burning growth company,
which usually has a high level of debt relative to its equity. The company currently operates purely off its shareholder
funding and has no debt obligation, reducing concerns around repayments and making it a less risky
investment.Stakeholders expects a robust recovery of financials of burger king and expects a growing trend for the
company along with its Market capitalixation

Kalyan Jewellers had announced plans to increase its retail footprint by 13% in the first quarter of FY22.The company
plans to enhance operations across seven States and will add 14 new showrooms, all on April 24, 2021.While the
jewellery major plans to scale up existing operations in tier-1 cities, with five new outlets including a flagship
showroom in Chennai, it will also focus on tier-2 and tier-3 markets by adding nine mid-size showrooms.
 Submitted by:

Thank You Isha Srivastava (110)

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