SAMHI Hotels IPO: SAMHI Hotels IPO opens for public subscription on Thursday, September 14, 2023 and will close on Monday, September 18, 2023. The bidding for anchor investors concluded on Wednesday, wherein the company collected Rs 616.55 crore. The price band for its public issue at Rs 119-126 per equity share of face value Rs 1 each. At the upper end of the price band, the company’s promoters and shareholders seek to raise Rs 1,370.10 Cr crore from the IPO. Ahead of the public issue, SAMHI Hotels GMP rose 28% per equity share.
The IPO comprises a fresh issue of 95,238,095 shares aggregating up to Rs 1,200 crore and an Offer-For-Sale (OFS) with promoters offloading 13,500,000 shares aggregating up to Rs 170.10 crore. The company intends to use the net proceeds from the IPO to Repayment/ prepayment/ redemption, in full or in part, of certain borrowings availed of by the company and the subsidiaries including payment of the interest accrued thereon and general corporate purposes. The lot size of SAMHI Hotels IPO is of 119 Shares.
SamHI Hotels (SHL) is a branded hotel ownership and asset management platform in India, with the third largest inventory of operational keys (owned and leased) in India as of March 31, 2023. The company has built a portfolio of 3,839 keys across 25 operating hotels in 12 of India’s key urban consumption centers, including Bengaluru, Hyderabad, the National Capital Region, Pune, Chennai, and Ahmedabad, as of March 31, 2023. Pursuant to the completion of the ACIC acquisition on August 10, 2023, SHL’s portfolio has further increased to 4,801 keys across 31 operating hotels.
Should you apply for the SAMHI Hotels IPO?
Choice Broking: Subscribe with Caution
“On the back of favorable macros like continued higher domestic business & personal travels, hotel room demand in excess of supply and improving occupancy levels & room rents, the hotel sector is showing positive traction in the operating and financial performance. SHL with its multi-brand presence across the price points is likely to benefit from this up-cycle. The company has reported net loss during FY20-23, further we are anticipating continued losses in the medium term but of lower magnitude. Thus, we assign a ‘Subscribe with Caution’ rating for the issue.”
Stoxbox : Avoid
“While the industry tailwinds paint a rosy picture for the business, the company-specific characteristics such as loss-making status and negative net worth for the past three fiscals – FY21, FY22, and FY23 paint an overall bleak picture for the business compared to improvement in metrics of its listed peers like Chalet Hotels and Indian Hotels over the fiscals. Moreover, with an asset-heavy model, the company has increased net borrowings to Rs. 26,144.10 million in FY23 from Rs. 22,540.95 million in FY21. We, therefore, recommend an “Avoid” rating for the issue.”
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