Apeejay Surrendra Park Hotels, a prominent player in the hospitality sector, has unveiled the price band for its upcoming initial public offering (IPO), set to open for subscription on February 5. The company is eyeing a substantial fundraising target of Rs 920 crore through this IPO.
Investors looking to participate in the IPO can bid for a minimum of 96 shares, with subsequent bids in multiples of 96. This structure translates to a minimum investment of Rs 14,112 for retail investors, while the upper end of the bidding range would require an investment of Rs 14,880.
The allocation of the issue size reflects a strategic distribution, with up to 75 percent reserved for qualified institutional buyers (QIB), 15 percent earmarked for high net-worth individuals, and the remaining 10 percent set aside for retail investors.
The IPO subscription window is set to close on February 7, with the anchor book opening for a day on February 2. Leading financial institutions, namely JM Financial, Axis Capital, and ICICI Securities, have been appointed as the merchant bankers for the issue.
The IPO structure involves a combination of fresh issuance of shares amounting to Rs 600 crore by the company and an offer-for-sale (OFS) of shares totaling Rs 320 crore by promoters and investors. Apeejay, the promoter, will be divesting shares worth Rs 296 crore in the OFS, while investors RECP IV Park Hotel Investors and RECP IV Park Hotel Co-Investors plan to offload Rs 23 crore and Rs 1 crore worth of shares, respectively.
Currently, promoters hold a significant 94.18 percent shareholding in Park Hotels, leaving 5.82 percent in the hands of the public, including RECP IV Park Hotel Investors with a 5.53 percent stake.
The primary utilization of the fresh issue proceeds, amounting to Rs 550 crore, will be directed towards debt repayment and general corporate purposes. As of January 2, 2024, the company carries a consolidated outstanding debt of Rs 582.28 crore.
This IPO signifies a significant move for Apeejay Surrendra Park Hotels, marking its entry into the public market. Investors are closely watching this development, gauging market sentiment and the company’s potential to leverage the funds raised for future growth and strategic initiatives.