Anchor Investors Infuse ₹324.72 Crore Ahead of Brigade Hotel Ventures IPO Opening

Mumbai, 24 July 2025: Brigade Hotel Ventures Ltd has opened its ₹759.60 crore Initial Public Offering (IPO) to the public today, following a strong anchor investment of ₹324.72 crore. The IPO comprises only a fresh issue of 8.44 crore equity shares and will close on 28 July 2025. The price band has been set at ₹85 to ₹90 per share.

Anchor Round Sees Participation from 17 Mutual Funds Ahead of IPO Launch

On 23 July, the company allotted 3.61 crore equity shares to anchor investors at ₹90 per share, raising ₹324.72 crore. A total of 17 domestic mutual funds participated, including SBI Mutual Fund, ICICI Prudential Mutual Fund, HDFC Mutual Fund, Motilal Oswal Mutual Fund, and Nippon India Mutual Fund. The strong anchor book is expected to set the tone for the IPO subscription across categories.

IPO Structure, Timelines, and Application Details

• IPO Open Date: 24 July 2025
• IPO Close Date: 28 July 2025
• Total Issue Size: ₹759.60 crore
• Fresh Issue: 8.44 crore equity shares
• Offer-for-Sale (OFS): None
• Price Band: ₹85 – ₹90 per equity share
• Bid Lot: 166 shares and multiples thereafter
• Face Value: ₹10 per share
• Listing: NSE and BSE
• Lead Managers: JM Financial Ltd and ICICI Securities Ltd
• Registrar: Kfin Technologies Ltd

Use of IPO Proceeds: Debt Reduction and Growth-Driven Allocation

• ₹468.14 crore will be used to repay or prepay borrowings
• ₹107.52 crore allocated for land acquisition from Brigade Enterprises Ltd (the promoter)
• Remaining funds will be deployed for acquisitions and general corporate purposes

This capital structure reflects the company’s strategy to strengthen its balance sheet and fuel future asset-driven growth.

Hotel Portfolio Covers Key Southern Markets Under Global Brands

Brigade Hotel Ventures Ltd operates nine hotels with a total of 1,604 keys across Bengaluru, Mysuru, Chennai, Kochi, and GIFT City. These properties are managed under agreements with international hospitality chains including Marriott, Accor, and InterContinental Hotels Group (IHG).

Restated Consolidated Revenue Improves but Net Profit Contracts Due to High Debt

In FY25, Brigade Hotel Ventures posted an operating revenue of ₹470.68 crore, registering healthy year-on-year growth from ₹404.22 crore in FY24. Its EBITDA also improved to ₹166.87 crore compared to ₹138.59 crore in the previous fiscal. However, net profit dropped to ₹23.66 crore in FY25 from ₹31.08 crore last year. This decline is primarily attributed to increased interest costs arising from the company’s high debt burden and one-time land purchase expenses. While the top line remains strong, the bottom line pressure highlights the importance of deleveraging, which the IPO aims to address.

KPIs Signal High Leverage but Strong Return Metrics

Brigade Hotel Ventures reported a high debt-to-equity ratio of 7.4, which is expected to improve post-IPO. Despite this, the company posted a robust Return on Net Worth (RoNW) of 30.11%-the highest among listed peers. Its Return on Capital Employed (ROCE) stood at 13.62%, reflecting efficient capital utilisation. However, the company’s Profit After Tax (PAT) margin was relatively low at 5.03%, suggesting operational challenges. The price-to-book value of 32.26 signals a premium valuation, backed by investor expectations of future growth.

Peer Comparison Shows High Returns but Lower Profitability

Brigade Hotel Ventures leads its peers in RoNW but lags behind on profitability. For instance, while Lemon Tree Hotels reported a PAT margin of 18.35% and Indian Hotels posted 12.38%, Brigade’s PAT margin remained at 5.03%. However, the company’s return ratios outpaced others, with the 30.11% RoNW significantly ahead of Indian Hotels (13.67%), Chalet Hotels (8.95%), and EIH Ltd (10.55%). This contrast shows the company’s capital efficiency even as it navigates margin constraints-factors the IPO is intended to help balance.

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