Samhi Hotels IPO opens today: 10 things to know before subscribing to the Rs 1370 cr issue

Samhi Hotels shares will be listed on both NSE and BSE. The stock is expected to list on September 27

Initial public offer of Goldman Sachs-backed Samhi Hotels will open for subscription on September 14 and the company aims to raise Rs 1,370.1 crore. Ahead of the IPO, Samhi Hotels has raised Rs 616.54 crore via anchor investors. The offer comprises a fresh issuance of shares worth Rs 1,200 crore and an offer-for-sale (OFS) of 1.35 crore equity shares.

Here are 10 key things to know before subscribing to the offer:

1) IPO Dates

The offer will open for subscription on September 14 and close on September 18.

2) Price Band

The price band for the issue has been fixed at Rs 119–Rs 126.

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3) Offer Details

The company aims to raise Rs 1,370.1 crore via IPO.  Singapore-based Blue Chandra Pte Ltd (owned by Equity International Fund V), Goldman Sachs Investments Holdings (Asia), and GTI Capital Alpha are the selling shareholders in the OFS. Samhi Hotels has raised Rs 616.54 crore ahead of the IPO via anchor investors.

4) Objectives of Issue

Samhi Hotels will use the proceeds from the fresh issue primarily for repaying debts amounting to Rs 900 crore and the remaining for general corporate purposes. The objective of the OFS is to allow the selling shareholders to sell an aggregate of up to 13,500,000 equity shares.

“The company will not receive any proceeds from the OFS. Each selling shareholder will be entitled to its respective portion of the proceeds of the OFS, after deducting its respective proportion of the offer-related expenses and the relevant taxes thereon,” HDFC Securities said in a report.

5) Lot Size

Investors can bid for a minimum of 119 equity shares and in multiples of 119 thereafter. Hence the minimum investment by retail investors would be Rs 14,161 (119 - lot size x 119 - lower price band). At the upper end, the bidding amount will increase to Rs 14,994.

6) Company Profile

Samhi Hotels Limited (SHL) is India’s one of the prominent branded hotel ownership and asset management platforms, with the third-largest inventory of operational keys (owned and leased) in India as of March 31. Within 12 years of starting its business operations, Samhi Hotels has built a portfolio of 3,839 keys across 25 operating hotels in 12 of India’s key urban consumption centres, including Bengaluru, Hyderabad, National Capital Region, Pune, Chennai and Ahmedabad as of March 31.

Pursuant to the completion of the ACIC Acquisition on August 10, the company’s portfolio has further increased to 4,801 keys across 31 operating hotels. The company operates with renowned hotel operators such as Marriott, Sheraton and Hyatt.

7) Financials

Samhi Hotels’ net loss narrowed to Rs 338.59 crore in FY23 from Rs 443.25 in FY22. Revenue from operations came in at Rs 738.57 crore in FY23, compared to Rs 322.74 crore in FY22. The company’s total income increased to Rs 761.42 crore in FY23 from Rs 333.1 crore in FY22.

8) Anchor Book & Investors

Samhi Hotels has raised Rs 616.54 crore ahead of the IPO via anchor investors on September 13. The government of Singapore, Monetary Authority of Singapore, CLSA Global Markets, Think India Opportunities Master Fund, HSBC Global, Natixis International Funds, Imco Emerging Markets Public Equity LP, Citigroup Global Markets Mauritius and Societe Generale were among the global investors that invested in the company via anchor book.

SBI Mutual Fund, ICICI Prudential, Aditya Birla Sun Life Trustee, Nuvama, Edelweiss, Vikasa India EIF I Fund, and Elara India Opportunities Fund also participated in the anchor book.

9) Risk Factors

Samhi Hotels has experienced continuous losses and negative net worth in the past few years. The company’s indebtedness and the conditions and restrictions imposed by its financing arrangements may limit its ability to grow its business. The company has not been in compliance with certain covenants under certain of its financing agreements in the past, and in case of any breach of covenants in the future, such non-compliance, if not waived, could adversely affect its business, results of operations and financial condition.

10) Listing Date

Samhi Hotels shares will be listed on both NSE and BSE. The stock is expected to list on September 27. However, no official announcement has been made till now.

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