PTR is a venerable restaurant of Bangalore set up decades ago by Prakash Naik. Despite its phenomenal
Question:
PTR is a venerable restaurant of Bangalore set up decades ago by Prakash Naik. Despite its phenomenal success, Prakash Naik was unwilling to set up branches be- cause he was concerned about the dilution of quality. In the last decade, however, alluring business opportunities and competitive compulsions persuaded Prakash Naik to set up a few branches of PTR at select locations in Bangalore and Chennai. This initiative, financed mainly through internal accruals, turned out to be quite prof- itable. Buoyed by this success, the Naik family, which owns 100 percent equity of PTR Limited, has chalked up an ambitious plan to set up a nation-wide chain of PTR restaurants and to support this initiative it wants to raise Rs. 100 crore through an initial public offering. Prakash Naik has asked you to brief the family members on various issues associ- ated with the move, by answering the following questions
(a) What the pros of going public?
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