Business
Café Coffee Day Announces That It Will Launch A Massive IPO Next Week
India’s much loved coffee brand, Cafe Coffee Day, announced that it will open an Initial Public Offering next week. Estimated to raise a total of Rs. 1,150 crore, this IPO will be the largest the country has seen in three years, in any sector.
The issue will launch on October 14th and end on October 16th, with the price for each share falling between a staggering Rs.316 to Rs.328. It has already got large investors like KKR, Stanchart PE and New Silk Route on board, and has also announced that it will be keeping shares worth RS.15 crores exclusively for its staff.
Why So Pricey?
As one of India’s largest coffee brands, Cafe Coffee Day can well afford to command such a high price for its shares.
“The company owns the brand (CCD) and operates all the stores. We are the only F&B brand owned by an Indian company not a foreign franchise,” said Chairman V.G Siddhartha to The Hindu. The brand has a presence in 219 cities with more than 1,400 outlets. Along with the cafes, the brand also manufactures, processes and retails a variety of coffees.
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What Will Money Be Used For?
After the IPO, what can one expect to see from Cafe Coffee Day? Firstly, it will be used to repay existing debts (estimated at Rs.750 crores). Cafe Coffee Day also plans to refurbish several outlets, manufacture vending machines, set up a new coffee production plant and set up Coffee Day Xpress kiosks.
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There’s a lot of anticipation about this IPO; will it live up to expectations? We’ll have to wait and see – after all, a lot can happen over coffee!