Did more greed overwhelm Burger King's subscribers?

 

Burger King (In World)

Burger King is restaurant chain known for serving high-quality, great-tasting, and affordable food. Founded in 1954, Burger King is the second largest fast food hamburger chain in the world. Every day, more than 11 million guests visit Burger King Restaurants around the world.

Burger King (In India)

Burger King is the India’s fastest growing quick service restaurant chains. It is the second largest fast food burger brand with having 216 Burger-King restaurants and 8 Sub-Franchised Burger King restaurants.

Why Burger King in news in Indian Stock market?

·         In Dec Burger King come with its IPO in Indian Stock Market. The IPO receives 156 times subscription, the second largest subscription in 2020.

·         The Rs.810-crore IPO was subscribed 156.6 times overall during December 2-4 as it received bids for 1,166 crore equity shares against offer size of 7.44 crore equity shares.

·         The Burger King gets 130% listing gain. An IPO price is 60. Share open on 14^th Dec at 115 and closing price at 138.4 with 130% listing gain.

·         After this bumper listing, stock never shrink and makes continuously new highs in next few days as per following chart :-

Date	Previous Close	Open	High	Low	Close	Change %
14-Dec	60	115.35	138.4	108.4	138.4	78.4	130.6667
15-Dec	138.4	148.6	166.05	145	166.05	27.65	19.97832
16-Dec	166.05	184	199.25	178.7	199.25	33.2	19.99398

·         In Just three Days, Stock gives 232% or 3.32 times return. In simple world, if you invested 10,000 in it you get 33,200 in only three days.

·         Now a turning factor comes, like a Bollywood movie. Everything is going good and the villain comes and change the whole game. The share goes down like a ball which is thrown from up to down.

·         The Stock is coming down every day as per following chart:-

Date	Previous Close	Open	High	Low	Close	Change %
17-Dec	199.25	219.5	219.5	179.35	179.35	-19.9	-9.98745
18-Dec	179.35	161.45	161.45	161.45	161.45	-17.9	-9.98049

 

·         The Share is down by 37.8 point or 20% in just 2 days.

·          All the shareholders who get allotment of burger king enjoy it when it is making upper circuit and now they have an atmosphere of fear.

My Point of View

Burger King is restaurant chain known for serving high-quality, great-tasting, and affordable food. In India, Burger King is only one who is listed with its original brand name. Because, if you asking someone about Jubilant Food, literally few know about it. If I am asking for dominos everyone will answer it. That is why everyone know about Burger King. Now take a look why this share making this up and down in last few days.

·         Burger King is a loss making company. Last three consecutive years company is making losses. It may also happen that the stock has been manipulated to benefit the investors. As per following chart we can see company is making losses :-

Annual	20-Mar	19-Mar	18-Mar
Sales	841	632	378
Other Income	5	11	10
Total Income	846	644	388
Total Expenditure	857	635	434
EBIT	-11	8	-45
Interest	65	46	36
Tax	0	0	0
Net Profit	-76	-38	-82

 

·         Burger King Subscription shows that HNI (High Net worth Individual) and QIB (Qualified Institutional Buyers) portion was oversubscribed at 354.11 times and 86.64 times, more than RII (Retail Individual Investor) 68.15 times. It is also a big factor for burger king movement. Everyone knows big houses makes money by manipulating the market shares. It just proven by the fact that at listing day it hits upper circuit. The Chart of subscription is given below :-

Category	Times
QIB	86.64x
HNI	354.11x
RII	68.15x
EMP	N/A
Total	156.65x

 

·         We can see correction in Burger King Stock. It is possible maybe we can see some lower circuit in Burger King Share. As per my assumption we can see burger king at 90-100

·         If I have been allotted shares of Burger King, I will sell the entire share within 15 min of listing.

·         At Last, please stay away from this type of stock which earning in loss. Share Market is like a real estate business. In real Estate only one thing matter Location, Location and Location. In Stock Market, this same thing apply Earning, Earring and Earning. So please check the earning of last 3 or 4 quarter before investing in stock.

Disclaimer:

All the views only for educational purpose. I do not have any attentions to manipulate the markets.