Subway in India is a popular quick-service restaurant brand owned by EverBrands India. EverBrands has officially filed its Draft Red Herring Prospectus with the Securities and Exchange Board of India. The company is focused on navigating the public capital markets to take a public listing to support its future growth path. The entire issue is designed as a clean equity issue of up to ₹600 crore, without any existing shareholders selling their equity stakes through an offer for sale.

The company is also exploring the possibility of a pre-IPO placement of up to ₹120 crore to bolster its capital structure. This is a pre-IPO placement, and if it is successfully completed, then the overall size of the fresh issue will be proportionally reduced. Once the regulatory procedures are completed, EverBrands will issue its equity shares on the BSE and NSE, the two leading exchanges in the country.

Operational structure and fund utilization

EverBrands’ operational structure is replicated across several popular beverage and fast food brands in the Indian market. The company operates in India via its subsidiary, Culinary Brands India Pvt Ltd, which controls the entire line of Subway outlets in India. 

EverBrands also manages Lavazza Coffee and F&H Coffee, in addition to its own quick service restaurant businesses. It also distributes Dilmah Tea through Fresh and Honest Cafe Pvt Ltd across India. 

EverBrands applies a dual operating model when operating Subway stores, managing both company-run and company-operated stores as well as franchise-run and franchise-operated stores. 

The firm has named Motilal Oswal, ICICI Securities and Nuvama as the book running lead managers and MUFG as the registrar for the initial public offering.

The proceeds from the fresh equity sale will be used to fund specific financial and business goals consistent with the company’s growth strategy. A part of the proceeds of ₹125 crore shall be used to repay existing borrowings so as to optimise the balance sheet of the business. 

The company-owned, company-operated format, in the target locations, will see a major allocation of ₹326.85 crore in capital expenditure. The proceeds of the issue will be used for general corporate needs.

As part of the programme, EverBrands plans to rationalise its market footprint, grow its number of corporate stores, and reduce its overall debt profile with a view to sustainable long-term performance.

Financial performance and shareholding structure

The draft prospectus, on closer inspection, shows a substantial increase in top-line growth and changes to overall profit levels in FY26. In FY26, total operating revenue at EverBrands increased by 34.9% YoY to ₹966.17 crore, while FY25’s total operating revenue stood at ₹716.06 crore. 

The quick-service restaurant segment led by Subway represented a 72% growth engine, contributing ₹693.09 crore during the fiscal year to the entire operating revenue of the company. Even with this healthy revenue improvement, net losses in FY26 were ₹58.19 crore, compared with ₹28.26 crore in the previous fiscal year. Overall, the company’s earnings before interest, taxes, depreciation and amortization in FY26 rose to ₹98.13 crore from the amount of ₹64.21 crore in FY25. 

In terms of physical footprint, it operated 678 company stores and 330 franchisee stores under the Subway brand in India and 8 franchisee stores in Sri Lanka by the end of FY26. There are larger institutional shareholders and corporate bodies holding equity on a fully diluted basis, which underpin the ownership of EverBrands. The majority holding company, EverBrands Ventures Pte Ltd, holds 57.78%. 

Norwest Capital LLC is the second-largest shareholder with a stake of 16.48%. Ongoing additional equity holdings are by Shivanand Shankar Mankekar HUF with a 5.83% stake and Playbook India Fund II with a 4.15% stake. Enrich Agro Food Products and Bikramjit Singh Kandhari hold an identical stake of 3.64% each on a fully diluted basis. 

Earlier this year, EverBrands closed a $15-million funding round led by Playbook Partners, with them buying into the company at an estimated enterprise valuation of ₹2,600 crore to ₹2,800 crore, representing 5% of the company’s shareholding. The public issue price band and opening dates will be announced later.

Conclusion

The Draft Red Herring Prospectus (DRHP) has been filed by EverBrands, which is moving towards becoming a publicly listed company on the Indian stock exchanges. The fresh issue brings in ₹600 crore that the company plans to use for expanding its company-owned Subway outlets, while improving its balance sheet output. While the company’s net profitability took a hit because of expansionary losses, the significant increase in revenue and operating earnings speaks to the size of its quick-serve business. While the market awaits the announcement of issue dates and the price band, EverBrands presents itself as one of the winners from the constantly growing food and beverage market in India.