Brigade Hotel Ventures Limited, a subsidiary of Brigade Enterprises Limited, has received approval from the Securities and Exchange Board of India (SEBI) for its initial public offering (IPO). The IPO aims to raise up to INR 900 crore through the issuance of fresh equity shares, each with a face value of ₹10. The company is considered the second-largest owner of chain-affiliated hotels and rooms in South India among major private hotel asset owners. As of June 30, 2024, the company's portfolio included 1,604 keys.
Brigade Hotel Ventures is a prominent hospitality company in South India that focuses on developing and owning hotels. It is a wholly-owned subsidiary of Brigade Enterprises Limited (BEL), a leading real estate developer in India. According to the Horwath HTL Report, as of June 30, 2024, they rank as the second-largest private owner of chain-affiliated hotels and rooms in South India, covering Kerala, Andhra Pradesh, Tamil Nadu, Karnataka, Telangana, and the Union Territories of Lakshadweep, Andaman and Nicobar Islands, and Pondicherry. This position is based on major private hotel asset owners with a portfolio of at least 500 rooms across India. BEL entered the hospitality sector in 2004, with its first hotel, Grand Mercure Bangalore, commencing operations in 2009. Brigade Hotel Ventures' portfolio includes nine operational hotels in cities such as Bengaluru, Chennai, Kochi, Mysuru, and GIFT City. The hotels are operated by globally recognized brands like Marriott, Accor, and InterContinental Hotels Group and span various segments from upper upscale to midscale. These hotels are strategically located in premium neighbourhoods and commercial hubs catering to both leisure and business travellers.
The funds raised through the IPO will be used for several strategic objectives. Approximately INR 481 crore is earmarked for repaying or prepaying outstanding borrowings of the company and its material subsidiary, SRP Prosperita Hotel Ventures Limited. Around INR 107.5 crore will be used to acquire an undivided share of land from its promoter, Brigade Enterprises Limited. The remaining funds will be allocated to inorganic growth opportunities and other general corporate purposes.
Brigade Hotel Ventures plans to expand its hospitality portfolio further across key cities in India. The company intends to develop five additional hotels in collaboration with global hospitality brands, focusing on new regions such as Goa and South India. Specific development plans include:
The luxury beach resort and two upper midscale hotels are expected to be completed by FY28, with the remaining hotels, including the wellness resort, to be completed by FY29.
The IPO will be managed by JM Financial Limited and ICICI Securities Limited. Post-IPO, Brigade Enterprises Limited (BEL) will retain a significant equity stake in Brigade Hotel Ventures, ensuring substantial control over the hotel development arm. Currently, BEL owns 100% equity in Brigade Hotel Ventures.
Disclaimer: This news is solely for educational purposes. The securities/investments quoted here are not recommendatory.