SAMHI Hotels has filed its draft red herring prospectus (DRHP) with market regulator SEBI to launch an initial public offering (IPO). SAMHI Hotels is a Gurugram-based hotel chain, which is backed by Goldman Sachs. The company had previously filed its DRHP in April 2019.
According to the DRHP, the public issue of SAMHI hotels comprises a fresh issue of Rs 1,000 crore and an offer for sale (OFS) of 90 lakh equity shares by selling shareholders, as per the draft papers. Investors including Blue Chandra, Goldman Sachs Investments Holdings (Asia), GTI Capital Alpha and International Finance Corporation will be participating in OFS.
The company will allocate 75 per cent of equity shares to qualified institutional buyers (QIBs), while non-institutional bidders will be given 14 per cent equity shares. Not more than 10 per cent of the offer shall be available for allocation to retail investors.
The company, in consultation with the lead bankers to the issue, may consider a private placement of equity shares aggregating up to Rs 200 crore. If such placement is completed, the fresh issue size will be reduced.
The net proceeds from the issue will be utilized towards repayment/ prepayment/redemption, in full or in part, of certain borrowings availed of by the company and its subsidiaries including payment of the interest and general corporate purposes.
SAMHI Hotels is a prominent branded hotel ownership and asset management platform in India, with the third largest inventory of operational keys in the country as of February 28, 2023, according to a JLL report mentioned in the DRHP.
It acquires or builds primary hotels and thereafter renovates, rebrands, re-rates the property and runs it efficiently. It divides its hotel portfolio into three distinct hotel segments: upper upscale, upper mid-scale, and mid-scale hotels.
It has built a portfolio of 3,839 keys spread across 25 operating hotels in 12 of India’s major urban consumer hubs, including Bangalore, Hyderabad, National Capital Region, Pune, Chennai, and Ahmedabad in 12 years of operations.
For the six months that ended September 30, 2022, more than 52 per cent of its total income came from upper mid-scale and mid-scale hotels. As of February 2023, it is the largest owner of the Fairfield by Marriott and Holiday Inn Express brands in India.
Some of the marquee names in its portfolio are Hyatt Regency, Pune; Courtyard by Marriott, Bengaluru; Four Points by Sheraton (Ahmedabad & Vizag); Fairfield by Marriott in Chennai Sriperembudur, Coimbatore, Goa, Kharadi, Bengaluru) and Holiday Inn Express across Ahmedabad, Bengaluru, Pune, Gurgaon, Hyderabad, Nashik, and Chennai.
For the financial year ending March 31, 2022, SAMHI reported an increase of 90.32 per cent in revenue to Rs 322.74 crore as against Rs 169.58 crore in the previous fiscal, primarily due to an increase in room revenue, average occupancy, and an increase in food and beverage revenue.
JM Financial and Kotak Mahindra Capital Company are the book-running lead managers for the issue, and KFin Technologies has been appointed as the registrar to the issue. Shares of the company will be listed on both BSE and NSE.
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