Lemon Tree Hotels, which operates in the mid-priced hotels sector, has set a price band of Rs 54 to Rs 56 for its IPO.
The initial public offering (IPO) of Lemon Tree Hotels was subscribed 0.25 times on Monday, the first day of the offer with investors bidding for 3.26 crore shares of the 12.98 crore shares offered to them. Qualified Institutional Buyers bid for 0.82 times the shares offered to them, high net worth individuals bid for 0.03 times their allocation, and retail investors 0.02 times. Lemon Tree Hotels, which operates in the mid-priced hotels sector, has set a price band of Rs 54 to Rs 56 for its IPO.
The IPO is an offer for sale of 18.54 crore shares, which at the upper price of the band will translate into an offer size of Rs 1,038 crore. The offer will close on March 28. Bids can be made for a minimum of 265 shares and multiples of 265 shares after that. The 100% offer-for-sale constitutes 23.58% of the post-offer paid up equity share capital of the company. The company will not receive any proceeds from the offer, and all the proceeds will go to the selling shareholders. Private equity investor, Warburg Pincus, is among the prominent sellers in the offer.
As per its red herring prospectus, Lemon Tree is the ninth largest hotel chain in India in terms of owned, leased and managed rooms, as on June 30, 2017. The company operates in the mid-priced hotel sector, consisting of the upper-midscale, midscale and economy hotel segments. Lemon Tree operates 4,697 rooms across 45 hotels, including managed hotels, in 28 cities in India as on January 31, 2018.