The book-running lead managers to the issue include Jm Financial, ICICI Securities, and Axis Capital.
The Kolkata-based Apeejay Surrendra Park opened for bidding to retail investors for its initial public offer on February 05. It is a Rs 920 crore book-built issue, comprising both fresh issue as well as offer for sale.
The price band of Rs ₹147 to ₹155 per share has been set for the issue, with a minimum lot size of 96 shares and then multiples of thereof. The issue has a reservation of up to 675,675 shares for employees offered, which will be at a discount of Rs 7 to the issue price.
The issue will close on February 07. The company’s shares will be listed on both the bourses: NSE and BSE. The issue has already raised Rs 409.50 crore from the anchor investors.
TH company is in the hospitality business and operates under the brand names “THE PARK”, “THE PARK Collection”, “Zone by The Park”, “Zone Connect by The Park” and “Stop by Zone”. According to the company, it also has a presence in the retail food and beverage industry, with the brand name ‘Flurys.
The company operates 80 restaurants, nightclubs, and bars. The company currently operates 27 hotels, which are spread across different categories such as luxury boutique, upscale, and upper midscale. These hotels are present in various cities in India including Kolkata, New Delhi, Chennai, Hyderabad, Bangalore, Mumbai, Coimbatore, Indore, Goa, Jaipur, Jodhpur, Jammu, Navi Mumbai, Visakhapatnam, Port Blair, and Pathankot.
The book-running lead managers to the issue include JM Financial, ICICI Securities, and Axis Capital. The registrar for the IPO is Link Intime India Private Ltd.
“We believe Apeejay Surrendra Park Hotels Ltd IPO gives investors an opportunity to invest in the 8th largest hotel chain with asset ownership in India. We like the company’s diversified portfolio while strategically positioning itself in key markets, leveraging an asset-light model that focuses on scalability and brand presence across diverse geographies. We also like the company’s impressive occupancy rates and RevPAR figures, reflecting its operational efficiency and portfolio optimization strategies. We believe the F&B and entertainment segment form an integral part of the ASPH business, which offers stability and resilience to earnings. By looking at the financials the company has shown strong growth in FY2022 and FY 2023 with 42.6%/98.5% in revenue from operations and strong recovery in net profit from a loss of Rs.28.2 cr in FY 2022 to a profit of Rs. 48.06 cr in FY 2023. On valuation parse at the upper band of Rs.155/-, the issue is asking for a Market Cap of Rs.3307/- Cr. Based on annualised FY24 earnings and fully diluted post-IPO paid-up capital, Given the company’s historic losses and recovering back to profitability, relying solely on P/E valuation may not be a practical approach. Instead, if we analyse it based on Price to Book Value, which stands at ~3x of FY24 annualized, compared to the industry average of ~5-8x it seems this IPO is reasonably priced to its peers. Hence, considering the industrial and company’s future growth rationales along with the primary objective of reducing the debt could lighten interest burdens which can improve the bottom lines in coming years. With its established brands, strategic growth initiatives, and resilient business model the company is well-positioned to capitalize on emerging market trends. Hence, we recommend investors to “SUBSCRIBE” the Apeejay Surrendra Park Hotels Ltd IPO for a long-term perspective,” said Rajan Shinde, research analyst at Mehta Equities.
Source:financialexpress.com