Mrs Bectors Food makes bumper listing, IPO investors see shares zoom 108% over issue price

Mrs Bectors Food Specialities shares made their stock exchange debut today at Rs 501 per share, up 74%, only to gain further minutes after listing. The stock zoomed 108% over the issue price of Rs 288 and was seen trading at Rs 601 apiece. The Rs 540 crore issue was the most subscribed IPO of 2020 so far, gaining a massive 197.38 times subscription rate with non-institutional investors bidding for the issue 620.85 times. The debut of Mrs Bectors is among the best in recent times, ahead of the other recent debutant, Burger King, that zoomed 92% on listing. Mrs Bectors Food commanded a market capitalization of Rs 3,412 crore on listing.

Check Live price: Mrs Bectors Food Specilities

The Rs 540 crore IPO of Mrs Bectors is largely an Offer For Sale (OFS) by existing shareholders with a small portion of fresh issuance. Prior to the issue, the promoters of the firm held a 52.4% stake in the firm which has been trimmed to 51.1% now. Public shareholding has increased from 47.6% to 48.9% after the IPO. “The stock is trading at 55.5x FY20 price to earnings & 2.3x FY20 EV/sales,” said brokerage and research firm ICICI Securities in a note.

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Mrs Bectors is a leading biscuit manufacturer in the premium and mid-premium segment of bakery products in North India. The company is the largest supplier of buns in India to reputed QSR chains like Burger King India, Connaught Plaza Restaurants, Hardcastle Restaurants and Yum! Restaurants (India). The firm has a 4.5% market share in the biscuit segment in north India and has a strong presence in the exports space as well with a 12% share in the calendar year 2019.

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The stock had been commanding a strong premium the unlisted space till yesterday. Expecting a strong listing, Amarjeet Maurya, AVP – Mid Caps, Angel Broking Ltd said that he would advise investors to book profits. “As an investor, if I get more than 50-60 per cent return, I would book profits and wait for a correction in the stock and then invest again. We are expecting that Mrs Bectors Food Specialities might get good multiples although not as high as other listed peers like Britannia Industries and Nestle India,” Maurya said.