Midcap Stock Jumps 7% on Major Expansion Plans

Devyani International’s share price jumped back in the green on Tuesday morning going up over 7% to hit an intraday high of ₹196.75.

What Happened: The Quick Service Restaurants (QSR) major announced the acquisition of a controlling stake in Restaurants Development Co (RD), Thailand. This will be achieved via an equity stake acquisition in RD and its holding companies. RD Thailand is a prominent operator of 274 KFC restaurants in Thailand. The deal will cost the company around ₹341 crore for a 50% stake.

KFC is the largest QSR/ LSR chain in Thailand and has enjoyed enormous growth and success since the first restaurant opened in 1984. The fast food giant said that Thailand is a strong poultry market it believes there is an opportunity available for the market to grow even further.

See Also: PM Narendra Modi Promises India Will Be Among World’s Top Three Economies In His Third Term

The acquisition, slated to close by March 31, 2024, is contingent on receiving regulatory and customary approvals. Temasek Holdings (Private) Limited, a Singapore-based global investment firm, is partnering with DIL on this strategic venture.

“Devyani’s entry into Thailand’s QSR market through this acquisition will usher in new avenues for growth and expansion. We are also committed to elevating the consumer experience and serving local communities,” DIL stated.

Reacting to the expansion plans, CLSA maintained its “outperform” rating for the stock with a price target of ₹211.

Price Action: Devyani International’s share price was up 7.43% to trade at ₹196.65 as the markets opened on Tuesday.

Read Next: Azad Engineering IPO Opens On 20th Dec: Sachin Tendulkar, VVS Laxman’s Investments Set To Soar

Don't miss a beat on the share market. Get real-time updates on top stock movers and trading ideas on Benzinga India Telegram channel.

Posted In: EquitiesM&APrice TargetReiterationRestaurantsMarketsAnalyst RatingsMoversTrading IdeasGeneralDevyani InternationalKFC