David Page, the chairman of Clapham House, the restaurant operator, remarked last month that he did not expect any prizes for being the first to give warning of a trading slowdown in the sector. Although a number of rivals have been spitting tacks over his comments and the resultant impact on sentiment towards the restaurant sector, today's mild profit warning from Prezzo, allied to recent cautionary comments from The Restaurant Group (TRG), suggests that he may not have been all that wide of the mark.

The question investors must ask themselves is whether the market reaction has been disproportionate. After all, companies such as TRG, with a low average spend per head, are likely to prove resilient to a downturn while the growth prospects for Prezzo are still impressive. What is more, the long-term prognosis for the eating-out market remains bullish.

One man who clearly believes that the sector has been oversold is Robby Enthoven, whose family controls the Nando's chicken chain through its Capricorn Ventures International vehicle. As soon as he saw Clapham House's shares dive after December's profit warning he pounced on an 11 per cent stake, and it emerged today that he has upped Capricorn's holding to just shy of 25 per cent.

From here, it looks like a no-lose situation. Clapham's Gourmet Burger Kitchen brand is a star in the making with international potential and plenty of room for expansion in the UK. Even if Mr Enthoven doesn't fancy swallowing the company himself, the rumoured interest from a host of other potential suitors means that he could turn a handsome profit on his investment.

Moreover, Clapham is believed to be in talks about the sale of its troublesome Tootsies chain, which would remove the main cause of its profit warning and give it the resources to restart expansion of Gourmet Burger. It was forced to pare back the rate of development to avoid adding to its debt burden to fund the growth.

The situation with midmarket restaurants bears some resemblance to five years ago, when, on the back of plunging share prices, several operators were taken private on the cheap by private equity. Among the predators was Capricorn Ventures, which teamed up with TDR Capital to buy out PizzaExpress after a profit warning. As it happens, the chairman of PizzaExpress at that time was a certain David Page.

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