Grand Continent Hotels IPO sees 35% subscription on Day 1

Grand Continent Hotels IPO

South-based hotel chain Grand Continent Hotels' initial public offering has received 35 percent subscription on its first day of bidding, i.e. March 20, with investors buying 16.6 lakh shares compared to the offer size of 47.16 lakh shares.

As per the subscription data on the NSE, the issue has received bids through 346 applications, of which the maximum (322) is from retail investors.

Qualified institutional buyers were at the forefront to support the issue, bidding 70 percent share of their reserved portion. Non-institutional investors picked 41 percent shares and retail investors 17.6 percent shares of their allotted quotas.

The company that along with joint venture entities operates 16 hotel properties with 753 keys in Karnataka, Tamil Nadu, Goa, Andhra Pradesh, and Telangana is raising Rs 74.46 crore via initial share sale which comprises of fresh issue of 62.6 lakh shares worth Rs 70.74 crore, and an offer-for-sale of 3.28 lakh shares worth Rs 3.72 crore.

The price band for the offer is Rs 107-113 per share.

The public issue will close on March 24, while the IPO share allotment will get finalised by March 25. Investors can start trading in Grand Continent Hotels shares on the NSE Emerge, effective March 27.

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The Bengaluru-based hotel chain has already raised Rs 21.16 crore by allotting 18.73 lakh shares to seven institutional investors via anchor book on March 19, at a price of Rs 113 per share. Negen Undiscovered Value Fund, Niveshaay Hedgehogs, India Max Investment Fund, and Saint Capital Fund are amongst seven investors in the anchor book.

The company intends to utilise Rs 34.08 crore out of net fresh issue proceeds for repaying debt against its total outstanding debt amounted to Rs 45.47 crore. Further, Rs 16.8 crore will be used for expansion of hotel properties, and the remainder amount for general corporate purpose.

Indorient Financial Services is acting as the book running lead manager to Grand Continent Hotels IPO.