Samhi Hotels IPO booked 5.33 times as QIBs rule final day of bidding

Samhi Hotels IPO closes today

The public issue of privately held Samhi Hotels received good response from qualified institutional buyers on the final day of bidding on September 18 with bids for 33.30 crore equity shares against an offer size of 6.25 crores, leading to a subscription of 5.33 times.

Qualified institutional buyers (QIB), who are generally considered as a medium-to-long investors, have bought 8.82 times the allotted quota which is 75 percent of the total issue size.

But the issue has not received enough support from high net-worth individuals and retail investors, who subscribed 1.22 times and 1.11 times the portion set aside for them which is 15 percent and 10 percent of the total offer.

Samhi Hotels, a prominent branded hotel ownership and asset management platform in India, aims to raise Rs 1,370.1 crore from the public issue at the upper price band. It comprises a fresh issue of shares worth Rs 1,200 crore, and an offer-for-sale (OFS) of 1.35 crore shares worth Rs 170.1 crore by three selling shareholders.

Also read: Samhi Hotels IPO: 10 things to know before subscribing to the Rs 1370 cr issue

Singapore-based Blue Chandra, owned by Equity International Fund V, Goldman Sachs Investments Holdings (Asia), and GTI Capital Alpha are the selling shareholders in the OFS.

The price band for the offer, which was subscribed 12 percent till September 15 (the second of bidding), is set at Rs 119-126 per share.

Of the total offer size, Rs 616.54 crore has been raised from anchor investors, including Monetary Authority of Singapore, Government of Singapore, HSBC Global, CLSA, Citigroup, Societe Generale, SBI Mutual Fund, ICICI Prudential, and Elara India Opportunities Fund, at the upper price band. The anchor book is a part of the QIB pie.

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The company, backed by global investors Equity International, ACIC Mauritius and Goldman Sachs, will utilise the net fresh issue proceeds for repaying debt worth Rs 900 crore, and the rest for general corporate purposes.

Samhi Hotels, which acquires or builds primarily business hotels, owns a portfolio of 4,801 keys across 31 operating hotels in key urban consumption centres in India as of August.

The finalisation of the basis of allotment of IPO shares by the company in consultation with the BSE will be taking place at the end of September 22, and the equity shares will be credited to demat accounts of eligible investors by September 26. The refunds or unblocking of funds from ASBA accounts for unsuccessful investors will be done by September 25.

Samhi Hotels will debut on the BSE and NSE on September 27, as per the IPO schedule.

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Its IPO shares are not getting good response in the grey market, trading at around 5 percent premium over the upper price band, analysts said on anonymity.

Overall, it has been a loss-making company as per the financials available for the last three years. The net loss narrowed to Rs 338.59 crore in the year ended March FY23, from Rs 443.25 in FY22, but revenue from operations more than doubled to Rs 738.57 crore, from Rs 322.74 crore during the same period.