Brigade Hotel Ventures Files for ₹900 Crore IPO
Brigade Hotel Ventures Limited, a subsidiary of Brigade Enterprises, has filed its Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) to raise ₹900 crore through an initial public offering (IPO).
Use of Funds
The company plans to use the proceeds for several key purposes:
- Repaying outstanding debts of the company and its subsidiary.
- Acquiring land from its promoter, Brigade Enterprises Limited (BEL).
- Exploring growth through acquisitions and other strategic initiatives.
- General corporate purposes.
IPO Details
The IPO will involve fresh equity shares issued at a face value of ₹10 each. The promoter will continue to own a significant stake in the hotel development business after the IPO. Currently, the promoter holds 100% of the company’s equity.
Expansion Plans
Brigade aims to develop five new hotels with global hospitality companies to expand its reach and attract a diverse guest base. They are considering new locations in India, including Goa and South India, to establish hotels.
The company has specific plans for:
- A luxury beach resort in Chennai in collaboration with Hyatt, pending final agreements.
- Two upper midscale hotels in Bengaluru in partnership with Marriott, subject to board approval.
- A luxury hotel under the InterContinental brand in Hyderabad, with a definitive agreement already in place.
- A wellness resort in Vaikom, Kerala, which involves acquiring additional land.
Hotel Portfolio
Brigade Hotel Ventures currently operates nine hotels across major cities like Bengaluru, Chennai, and Kochi, offering a total of 1,604 rooms. They work with leading global brands such as Marriott, Accor, and InterContinental Hotels Group.
Market Position
As the second-largest owner of chain-affiliated hotels in South India, Brigade Hotel Ventures plays a vital role in the region’s hospitality sector, which includes several southern states and Union territories.
Conclusion
For this IPO, JM Financial Limited and ICICI Securities Limited are the appointed lead managers. The hospitality market in India is growing, with a significant increase in chain-affiliated hotel rooms projected in the coming years.
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