Mumbai: Shares of Barbeque Nation Hospitality on Wednesday listed at a 1.5% discount to their issue price of Rs500 a piece. The scrip, however, later rose to Rs553.

The stock opened at Rs492 on the BSE and touched a low of Rs481.35. The company's initial public offering was subscribed six times last week.

The tepid listing comes on the heels of Easy Trip Planner, Anupam Rasayan, Craftsman Automation, Kalyan Jewellers India and Suryoday small Finance Bank witnessing poor debut on the exchanges.

Analyst said the covid pandemic, as well as measures to curb the spread of the di, had a substantial impact on the company’s restaurant operations.

"The chain casual dining restaurant industry is expected to grow at a faster pace over the next five years. However, we believe the bigger size restaurants and limitation in scaling up delivery sales can impact the growth for the company. Moreover, we await clarity on full recovery from Covid 19 before assigning any recommendation" said ICICI Direct in a note to its investors.

The Rs453 crore Barbeque Nation issue got bids for 2.99 crore shares against the offer size of 49.99 lakh shares. Retail investors submitted bids 13.13 times the reserved portion, while that of non-institutional investors was subscribed 3.10 times.

The IPO comprised a fresh issue of shares worth Rs180 crore and an offer for sale of up to 5.46 million equity shares by current promoters and shareholders.

The offer for sale comprises sale by Sayaji Housekeeping Services Ltd of up to 1.02 million shares, by Azhar Dhanani, Sadiya Dhanani and Sanya Dhanani of up to 3.39 lakh each, and by Tamara Pvt Ltd of 3.32 million shares.

The Dhanani family held 45.7% in Barbeque Nation through a subsidiary of their listed flagship Sayaji Hotels. CX Partners held 21.72% in the firm and ace investor Rakesh Jhunjhunwala's investment firm Alchemy Capital 2.07%.

IIFL Securities, Axis Capital, Ambit Capital and SBI Capital were the lead managers to the issue.

Net proceeds aggregating to Rs54.62 crore will be used for setting up 26 new Barbeque Nation Restaurants during fiscal 2022 and 2023. The premises for the proposed new restaurants are expected to be leased.

The company also intends to pay around Rs75 crore outstanding borrowing obtained by the company. As of November 2020, net debt of the company stood at Rs148.10 crore.

For fiscal year 2020, the company reported a revenue of Rs846.97 crore against Rs739.02 crore a year ago. Net loss for the period stood at Rs32.93 crore versus Rs38.39 crore.

As of December, the company had 164 restaurants owned and operated-- 147 Barbeque Nation restaurants across 77 cities in India, six international restaurants across four cities outside India and 11 Italian restaurants across three metro cities in India .