The Grand Continent Hotels IPO is a significant step for the company in its expansion into the Indian hospitality market. The company focuses on mid-scale hotels catering to Indian middle-class guests and business travelers. With 16 operational properties across various states, including Karnataka, Tamil Nadu, Goa, Andhra Pradesh, and Telangana, Grand Continent Hotels aims to strengthen its market presence with an offer of ₹74.45 Crores, which includes a Fresh Issue of 62.60 lakh shares worth ₹70.74 Crores and an Offer for Sale of 3.28 lakh shares totaling ₹3.71 Crores. The price band for the IPO is set at ₹107 to ₹113 per share, and the market capitalization at the upper end of the price band will be ₹281.58 Crores.

IPO Subscription & Dates:

The subscription period opens on March 20, 2025, and closes on March 24, 2025. The allotment date is expected to be finalized on or around March 25, 2025, with the listing date anticipated to be March 27, 2025, on the NSE SME platform. The lot size for the IPO is 1,200 shares, with a minimum investment requirement of ₹1,35,600 for retail investors. High-net-worth individuals (HNIs) need to invest a minimum of 2 lots (2,400 shares), totaling ₹2,71,200.

Grey Market Premium (GMP) and Subscription Status:

As of March 24, 2025, the Grey Market Premium (GMP) for the Grand Continent Hotels IPO is expected to be ₹17, indicating a 19.00% potential listing gain. However, trading on the Grey Market is not a reliable indicator of the IPO's success, as it is unregulated and speculative. Investors should focus on the fundamentals when considering the IPO.

The live subscription status as of March 24, 2025 shows a 1.74 times subscription, with significant investor interest. This indicates the IPO’s demand and potential for success on listing.

Allotment Process:

To check the allotment status, investors can follow a simple process once the allotment date is announced:

1. Visit the Registrar’s website.

2. Select Grand Continent Hotels IPO from the dropdown list.

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

4. Submit the information to view the allotment status.

Objectives of the IPO:

The net proceeds from the IPO will be used for various strategic purposes:

• ₹34.08 Crores will be utilized for the repayment of existing borrowings.

• ₹16.79 Crores will aid in expanding hotel properties across India.

• The remaining funds will be allocated for general corporate purposes.

Company Financials:

• Revenue: In FY24, Grand Continent Hotels reported a revenue of ₹3,186.32 Lakh.

• EBITDA: ₹1,126.94 Lakh for the period ending Sep 30, 2024.

• Profit After Tax: ₹622.37 Lakh for FY24, showing consistent growth.

Key financial metrics such as P/E ratio of 44.49x (pre-issue) and 69.06x (post-issue) compared to the industry P/E of 45x suggest the IPO is fully priced. However, the company’s growth trajectory and market positioning in the mid-scale hotel sector make it an attractive investment option for risk-seeking investors.

Conclusion:

Considering the financial growth, management experience, and market positioning of Grand Continent Hotels, the IPO presents a promising opportunity for investors, particularly those seeking listing gains. However, given its high valuation and the industry's competitive nature, it is recommended to proceed with caution, especially for those with a low-risk appetite.

Investors should closely monitor the GMP trends, subscription status, and market conditions before making their investment decision.

The Upcoming IPOs in this week and coming weeks are Arisinfra Solutions Limited, Identixweb Limited, Retaggio Industries Limited, Infonative Solutions Limited.

The Current active IPO are ATC Energies System Limited, Shri Ahimsa Naturals Limited, Desco Infratech Limited, Rapid Fleet Management Services, Active Infrastructures Limited.

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