HBI Staff | Hyderabad 
Mumbai-based Travel Food Services (TFS), operating a travel quick service restaurant and a lounge business across airports in India and Malaysia, has filed its Draft Red Herring Prospectus (DRHP) with capital markets regulator, Securities and Exchange Board of India (SEBI) for its INR 2,000 crore Initial Public Offering (IPO).
The IPO with a face value of INR 1 is entirely an offer for sale of up to INR 2,000 crore by Kapur Family Trust. The offer includes reservations for subscriptions by eligible employees.
Compared to its listed industry peers like Jubilant FoodWorks, Devyani International, Sapphire Foods India, Westlife Foodworld, and Restaurant Brands Asia, Travel Food Service achieved the highest earnings per share (EPS) in fiscal 2024.
Revenue from operations increased by 30.85% to Rs 1,396.32 crore in fiscal 2024 from INR 1,067.15 crore in fiscal 2023, attributable to an increase in its LFL Sales and Net Contract. Profit after tax increased by 18.59% to INR 298.02 crore in fiscal 2024 from Rs 251.30 crore in fiscal 2023.
For the three months ended June 30, 2024, revenue from operations stood at INR 409.86 crore, and profit after tax stood at Rs 59.55 crore.
The Offer is being made through the book-building process, wherein not more than 50% of the net offer is allocated to qualified institutional buyers, and not less than 15% and 35% of the net offer is allocated to non-institutional and retail individual investors respectively.
Travel Food Services launched its first travel quick-service restaurant (QSR) outlet in 2009. It is promoted by SSP Group plc (“SSP”) and its affiliates—SSP Group Holdings Limited, SSP Financing Limited, SSP Asia Pacific Holdings Limited—along with the Kapur Family Trust, Varun Kapur, and Karan Kapur.
SSP, an FTSE 250 company listed on the London Stock Exchange, is recognized as a global leader in the Travel Food & Beverage (F&B) sector based on revenue in 2024, as per the CRISIL Report. The Kapur Family Trust operates under the flagship brand K Hospitality, which oversees and invests in several hospitality and food service businesses, including Travel Food Services (collectively referred to as “K Hospitality”).
Headquartered in Mumbai, the company leads the rapidly expanding Indian airport Travel QSR and Lounge sectors, holding the top position in terms of revenue for Fiscal 2024, according to the CRISIL Report. Its Travel QSR portfolio features a diverse selection of food and beverage (F&B) concepts tailored for travelers, including fast food, cafes, bakeries, food courts, and bars, primarily located in airports and some highway locations to cater to the needs of fast-moving customers.
In Fiscal 2024, the company commanded a 24% revenue market share (including its Associates and Joint Ventures) in the Indian airport Travel QSR sector, as highlighted by the CRISIL Report. It also managed the largest network of private airport Lounges in India as of March 31, 2024, operating 24 Lounges across eight airports and capturing a 45% revenue market share in the airport Lounge sector during the same period. From 2009 until June 30, 2024, TFS contract retention rate is at 92%.
The company’s presence spans 14 airports in India, including major hubs like Delhi, Mumbai, Bengaluru, Hyderabad, Kolkata, and Chennai, as well as three airports in Malaysia, as of June 30, 2024.
With a robust portfolio of 117 partner and in-house brands, the company operates 397 Travel QSR outlets across India and Malaysia, as of June 30, 2024. Its QSR outlets are predominantly located within airports, with select locations along highways. It also operated 31 Lounges in India and Malaysia as of the same date and expanded internationally by opening a new Lounge in Hong Kong in July 2024.
As of June 30, 2024, Travel Food Services boasts a diverse portfolio of partner brands, comprising both international and regional Indian brands, alongside its own in-house brands. The international brands include renowned names such as KFC, Pizza Hut, Wagamama, Coffee Bean & Tea Leaf, Jamie Oliver’s Pizzeria, Brioche Doree, Subway, and Krispy Kreme. The regional Indian brands in its network feature popular chains like Third Wave Coffee, Hatti Kaapi, Sangeetha, Bikanervala, Wow Momo, The Irish House, JOSHH, Adyar Ananda Bhavan, and Bombay Brasserie. Additionally, Travel Food Services has developed its own in-house brands, including Caféccino, Dilli Streat, idli.com, and Curry Kitchen.
Travel Food Services boasts the largest network of Travel QSR outlets and airport-based QSRs in India, with 313 of its 340 operational outlets located at airports and the remainder on highways, as of March 31, 2024, according to the CRISIL Report.
The Indian airport Travel QSR and Lounge sectors are projected to experience significant growth, driven by increasing traveler dwell times, the rise of low-cost carriers, and the expansion of credit card and loyalty programs. As per the CRISIL Report, the Indian airport Travel QSR market is expected to grow at a compound annual growth rate (CAGR) of 17%-19%, while the Lounge sector is forecasted to grow at a CAGR of 21%-23% between Fiscal 2024 and 2034.
Kotak Mahindra Capital Company Limited, HSBC Securities and Capital Markets (India) Private Limited, ICICI Securities Limited, and Batlivala & Karani Securities India Private Limited are the book-running lead managers and Link Intime India Private Limited is the registrar to the issue. The equity shares are proposed to be listed on the National Stock Exchange of India Limited and BSE Limited.
