EverBrands India Ltd, the operator of Subway restaurants, has filed draft papers with SEBI to raise ₹600 crore through an initial public offering. According to the Draft Red Herring Prospectus (DRHP) filed on Tuesday, the IPO is entirely a fresh issue of equity shares with no offer-for-sale component. The company may consider a pre-IPO placement of up to ₹120 crore before filing the red herring prospectus with the Registrar of Companies. If the pre-IPO placement is undertaken, the fresh issue size will be reduced by the amount raised through the placement. The company plans to utilize ₹125 crore of the proceeds to repay or pre-pay borrowings of its wholly-owned subsidiary Culinary Brands India, while ₹326.9 crore will fund the setting up of new Subway stores under the company-owned-company-operated (COCO) format. The remaining proceeds will be utilized for general corporate purposes. As per the latest reports, locations for the new stores to be funded through the IPO have not yet been finalised, with the proposed deployment based on management estimates and not appraised by any bank or financial institution.
EverBrands India has significantly accelerated its shift towards company-owned stores, purchasing 101 franchisee-run stores in FY26 as part of its strategic expansion. According to the draft red herring prospectus filed with SEBI, the company plans to use ₹326.9 crore of IPO proceeds to fund 460 new company-owned stores by FY29. This represents a dramatic transformation from EverBrands' acquisition of the Subway India business in December 2021, when it inherited a largely franchise-led network with 143 company-owned stores as of April 2023. The company has since acquired 188 franchised stores for ₹150.3 crore, including the 101 stores purchased in FY26, while 105 franchised stores shut over the three-year period. Company-owned stores have risen nearly fivefold to 678 as of March 2026, while franchisee-run stores have fallen to 330 from 501 two years earlier, with two-thirds of the 1,008 total stores now company-run. The shift provides EverBrands with significantly better economics, as it pays 6% royalty for franchised stores versus 6.5% for company-owned stores, while capturing 13-15% of store-level operating profit compared to only about 2% of sales from franchised stores.
The company's financial performance has shown significant growth across its key verticals. According to the DRHP, revenue from operations increased 34.93% to ₹966.17 crore in FY26 from ₹716.06 crore in FY25 and ₹548.85 crore in FY24. The QSR vertical specifically rose to ₹693.09 crore in FY26 from ₹480.38 crore in FY25 and ₹355.31 crore in FY24. However, the company remained loss-making with FY26 losses widening to ₹58.2 crore from ₹28.26 crore in FY25 and ₹16.67 crore in FY24. Adjusted EBITDA stood at ₹28.61 crore, giving an adjusted EBITDA margin of 2.96%. Finance costs increased to ₹54.63 crore from ₹31.21 crore, attributed mainly to higher interest on lease liabilities as the COCO network expanded. The subsidiary Culinary Brands India had total outstanding borrowings of ₹149.7 crore as of March 2026, with adjusted net debt standing at ₹117.39 crore after accounting for cash and certain fixed deposits. The company's shift towards company-owned stores has improved productivity, with same-store sales growth at existing company-owned stores at 6.2% in FY26 compared to a 2.4% decline in FY25, outperforming Burger King at 4% and Westlife's McDonald's at -1.1%.
The promoters hold 58.06% of EverBrands' pre-issue capital, while the remaining 41.94% is held by public shareholders. Among the public shareholders, Norwest Capital holds a 16.48% stake, while Playbook Partners India holds a 4.15% stake. EverBrands India claims to be the third-largest player by store count in India's large and fast-growing QSR segment. The company competes with listed peers such as Jubilant FoodWorks, Devyani International, Westlife Foodworld, Sapphire Foods India and Restaurant Brands Asia. Motilal Oswal Investment Advisors, ICICI Securities and Nuvama Wealth Management are the merchant bankers managing the IPO, while MUFG Intime India is acting as the registrar. The IPO comes as India's organised food-services market continues to expand, with the overall food-services market projected to grow from ₹5.61 lakh crore in FY25 to ₹9.09 lakh crore by FY30, while the organised segment is expected to grow from ₹2.80 lakh crore to ₹5.27 lakh crore over the same period.
Beyond Subway operations, EverBrands operates beverage businesses through exclusive partnerships with Lavazza and Dilmah, along with its Fresh & Honest brand. Revenue from the beverage business increased to ₹240.57 crore in FY26 from ₹206.36 crore in FY25 and ₹172.16 crore in FY24. The number of installed coffee machines also increased to 9,455 in FY26 from 8,322 in FY25. However, the company has a single coffee roasting and processing facility and a single machine manufacturing facility at Sri City in Andhra Pradesh, making these facilities critical to the beverage business. The company has flagged risks related to its dependence on the Subway brand, food safety, the performance of new COCO stores, debt and financing costs, foreign exchange movements and outstanding litigation. According to its DRHP, the food & beverage company has incurred losses over the past three fiscal years, and may continue to incur losses in the future.
