10 important things investors must know about the Apeejay Surrendra Park Hotels IPO

Apeejay Surrendra Park Hotels IPO, a significant participant in the hotel industry, took place on February 5, 2024. For the Apeejay Surrendra Group, this Hotel IPO, which is scheduled to conclude on February 7, 2024, represents an important milestone. The firm also runs additional brands including "Zone by The Park," "Flurys," and "The Denmark Tavern." It is well known for its opulent boutique Park Hotels around India. The following are 10 things you should know about the Apeejay Surrendra Park Hotels initial public offering (IPO):

1. An offer for sale and a new issuance is combined in the initial public offering (IPO). The ₹600 crore new issue would be used for issuance costs, general corporate objectives, and repayment or prepayment of specific borrowings. The company's promoters and current shareholders are set to sell the ₹320 crore offer for sale. ₹920 crore is the entire issue size.

2. Each equity share of the IPO has a face value of ₹1 and is priced between ₹147 and ₹155. A minimum lot size of 96 shares and a maximum lot size of 1,248 shares are also possible. Retail investors can contribute as little as ₹14,880 and as much as ₹193,440. A share costs ₹7 less for employees.

3. The initial public offering (IPO) has received full subscriptions on the first day of bidding, with non-institutional and ordinary investors leading the charge. There were 3.33 reservations made for the retail section, 1.67 reservations for the non-institutional portion, and 0.98 reservations for the appropriate institutional portion. As of February 5, 2024, at 2:00 PM, the total subscription was 1.5 times.

4. The business has raised ₹409.5 crore from 21 anchor investors, which include the mutual funds of HDFC, ICICI Prudential, SBI, Axis, Aditya Birla Sun Life, Kotak Mahindra, and Nippon India. For an issue price of ₹155 per share, the business has given the anchor investors about 2.64 crore equity shares.

5. The fact that a network of 32 hotels, comprising 25 owned hotels, 5 managed hotels, and 2 joint venture hotels, the firm is a prominent player in the Indian luxury boutique hotel market. Scattered throughout 22 Indian cities, the firm boasts 2,937 rooms. Ten more hotels that the business is planning to open by 2025 are in the works.

6. The firm is known by four distinct brands: "The Park," a high-end boutique hotel; "Zone by The Park," an upmarket social catalyst hotel; "Flurys," a high-end tea parlor and bakery brand; and "The Denmark Tavern," a heritage hotel brand. Additionally, as of December 31, 2023, the corporation had over 1.2 lakh members in its reward program, The Park Preferred.

7. The company's operational revenue for the 2023 fiscal year was ₹1,021.9 crore, up 18.6% from the year before. EBITDA for the firm increased by 26.4% to ₹316.9 crore in the fiscal year 2023 from the previous year. The company's fiscal year 2023 profit after tax amounted to ₹69.8 crore, a 32.9% increase over the previous year.

8. The company's asset-light business strategy, emphasis on innovation and customer satisfaction, varied and strategically placed hotel portfolio, skilled and knowledgeable management team, and high brand recognition and reputation are among its competitive advantages.

9. The company's growth strategies include extending its reach into important and developing markets, improving profitability and operational efficiency, capitalizing on its customer base and brand equity, looking into new business ventures and alliances, and continuing its sustainability and CSR initiatives.

10. The business must contend with several risks and difficulties, that effects the hospitality sector, the legal and regulatory ambiguities surrounding the Securities and Exchange Board of India's (SEBI) ongoing lawsuit, competition from other hotel operators, reliance on outside service providers, and variations in occupancy and average daily rates.