Brigade Hotel Ventures, one of South India's largest hospitality asset owners, has launched its initial public offering (IPO) with a fresh issue size of Rs 759.6 crore. The IPO opens for public subscription on July 24, 2025, and will close on July 28, 2025.

The company owns and develops hotels in key urban centers across India, particularly in South Indian states such as Karnataka, Tamil Nadu, Andhra Pradesh, Kerala, Telangana, and union territories like Pondicherry and Andaman & Nicobar Islands. As of March 31, 2025, it was the second largest chain-affiliated hotel owner in the region among private asset holders with more than 500 rooms pan-India.

IPO Structure and Investment Details

The Brigade Hotel Ventures IPO is a Book Built Issue, comprising a fresh issue of 844 lakh equity shares. There is no offer for sale (OFS) component in this IPO. The price band has been set between Rs 85 and Rs 90 per share. At the upper end, the post-issue market capitalisation of the company is expected to be Rs 3,418.47 crore.

The lot size for retail investors is 166 shares, requiring a minimum investment of Rs 14,940. For High-Net-Worth Individuals (HNIs), the minimum bid is 14 lots or 2,324 shares, totalling Rs 2,09,160.

ICICI Securities Limited and JM Financial Limited are acting as the Book Running Lead Managers (BRLMs), while KFin Technologies Limited is the registrar for the issue.

Use of IPO Proceeds

The company plans to deploy the net proceeds from the IPO for the following objectives:

1. Rs 468.14 crore for repayment or prepayment of certain outstanding borrowings:

   • Rs 413.69 crore for the company itself

   • Rs 54.45 crore for its material subsidiary, SRP Prosperita Hotel Ventures Limited

2. Rs 107.51 crore for payment of consideration for buying undivided share of land from the promoter, Brigade Enterprises Limited (BEL)

3. Balance for inorganic growth opportunities, strategic initiatives, and general corporate purposes

Financial Performance

Brigade Hotel Ventures has shown consistent growth over the last three fiscal years. The revenues from operations were:

• FY25: Rs 470.68 crore

• FY24: Rs 404.85 crore

• FY23: Rs 356.41 crore

EBITDA has also improved steadily:

• FY25: Rs 166.87 crore

• FY24: Rs 144.61 crore

• FY23: Rs 102.98 crore

Profit After Tax (PAT) stood at:

• FY25: Rs 23.66 crore

• FY24: Rs 31.14 crore

• FY23: Rs -3.09 crore (loss)

The financials reflect a positive turnaround, especially with profitability maintained over the last two years.

Valuation Metrics

The company has reported a pre-issue EPS of Rs 0.72 and a post-issue EPS of Rs 0.53 for FY24. The pre-issue price-to-earnings (P/E) ratio stands at 125x, while the post-issue P/E comes to 169.32x, which is considerably higher than the industry P/E average of 91x.

Other key metrics:

• Return on Capital Employed (ROCE): 13.62%

• Return on Equity (ROE): 30.11%

• Return on Net Worth (RoNW): 30.11%

These indicate a strong return profile, but the valuation is aggressive compared to its peers.

Grey Market Premium (GMP) and Listing Prospects

As of July 22, 2025, the Grey Market Premium (GMP) for the Brigade Hotel Ventures IPO is reported to be Rs 0, implying no premium or discount in unofficial markets. This is typically indicative of neutral investor sentiment.

No real discovery of price can happen based on grey market activity alone. The GMP fluctuates based on unorganised market demand and supply and should not be considered for investment decisions.

IPO Allotment and Listing Date

The IPO allotment is expected to be finalised on Tuesday, July 29, 2025. Investors can check their allotment status on the registrar’s website using the following steps:

1. Visit the IPO allotment status page

2. Select Brigade Hotel Ventures Limited IPO

3. Enter application number, PAN, or DP Client ID

4. Submit to view the allotment result

The company’s shares are proposed to be listed on both BSE and NSE on or around Thursday, July 31, 2025.

Management and Promoters

The company is guided by an experienced leadership team including Nirupa Shankar, Amar Mysore, and Vineet Verma, all of whom bring deep expertise in hospitality and real estate sectors. Their strategic direction has helped shape the company’s expansion in premium hospitality assets.

Expert Recommendation

While Brigade Hotel Ventures has strong regional dominance and a consistent revenue profile, its valuation appears expensive when compared to listed peers. With a high P/E ratio, zero GMP, and a modest PAT, the IPO is fully priced.

Recommendation: Investors are advised to avoid Brigade Hotel Ventures IPO for listing gains.

Long-term investors who understand the hospitality sector may consider applying with caution and only after further due diligence.

Disclaimer: This content is for educational and informational purposes only and does not constitute financial advice or an investment recommendation. All investors should seek professional advice before investing. Market investments carry risks, and past performance is not indicative of future results.

The Upcoming IPOs in this week and coming weeks are Takyon Networks, Mehul Colours, Aditya Infotech, Sri Lotus Developers & Realty, Lakshmi India Finance, Jyoti Global Plast, B.D. Industries (Pune), Kaytex Fabrics, Umiya Mobile, Shree Refrigerations, Sellowrap Industries, Repono, Shanti Gold International, Patel Chem Specialities, NSDL.

The Current active IPO are Brigade Hotel Ventures, Indiqube Spaces, GNG Electronics, TSC India, Monarch Surveyors & Engineering Consultants.

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