 "Bottler Ravi Jaipuria to raise $300 mn by '16")
Jaipuria said the proposed IPOs would help RJ Corp support his estimated $600-million investment in the two companies for expansion through the next few years. He plans to double the group's turnover from about Rs 10,000 crore in 2015 to about Rs 20,000 crore by 2017. Through the past few years, the group had been growing at about 40 per cent annually through natural expansion and acquisitions across segments, he added.
According to Jaipuria, the promoters intend to dilute about 10 per cent stake in each of the companies through the IPOs; private equity (PE) investors are likely to make exits during the public listing. Jaipuria, averse to public listing a few years ago, said the two RJ Corp entities had to be scaled up, which would need more funds and professionals.
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"IPOs will be the best way to stabilise businesses," he said.
Meanwhile, Jaipuria is also talking to PE investors to raise $100-125 million for about 10 per cent equity stake in Varun Beverages in a pre-IPO deal. "We hope to close this by the end of December," he said. Standard Chartered PE holds about five per cent stake in the company.
Varun Beverages, which acquired all company-owned bottling operations from PepsiCo in north India earlier this month, was set to go public by the end of 2015 or early 2016, Jaipuria said. While half its business is accounted for by PepsiCo in India, Varun Beverages also has bottling plants abroad, including Sri Lanka, Mozambique, Zambia and Morocco.
Fast-food entity Devyani International, in which Temasek has about 15 per cent stake, is likely to be valued at about $1 billion when it goes public. "About 10 per cent of the promoters' equity stake will be offered during the IPO in 2016," Jaipuria said.
"Through the next two-three years, we will expand all our businesses, both existing operations and through acquisitions," he said, adding he would be interested in taking over Yum! Brands' businesses in west and south India. "We are open, and we'll talk to them. We already have the rights in the north and the east. National rights will certainly make sense," he said.
Devyani International holds the franchisee rights for Pizza Hut, KFC, and Taco Bell in north and east India.
Jaipuria said he was also approached by Burger King, but he didn't take the proposition forward, as it would have meant "conflict of interest" with KFC. "We won't look at anything that might be conflicting," he said, adding he might look at Mexican, Thai and Chinese food as categories for expansion.
"For fast food and beverages, we will be expanding in India, the African continent and the Saarc (South Asian Association for Regional Cooperation) region," he said. For expansion, Varun Beverages is eyeing new markets such as Zimbabwe and Bhutan.
Jaipuria, who is already present in the ice cream market across the country with Creme Bell, now plans to expand in the dairy segment, too. "We will be putting a new large plant next year, in addition to our existing three. Besides ice cream, we have plans to get into other dairy products such as yogurt, milk, butter and cheese. Essentially, these will work in the backward integration for our fast-food businesses."
He said he intended to disrupt the dairy market in 2016. Besides India, Jaipuria is also eyeing the market in Africa for his dairy products.