Prestige Group’s hospitality arm plans ₹2,700 crore IPO; eyes expansion in hotel segment
Prestige Hospitality Ventures Ltd said it has filed preliminary documents with SEBI to launch its initial public offering to raise to ₹2,700 crore
Bengaluru-based Prestige Hospitality Ventures Ltd (PHVL), an arm of Prestige Estates Projects Ltd, has filed preliminary papers with the Securities and Exchange Board of India (SEBI) to launch its initial public offering (IPO) to raise up to ₹2,700 crore, the company said in a regulatory filing.
The company filed its Draft Red Herring Prospectus (DRHP) with the markets regulator SEBI on April 24.
"The IPO comprises a fresh issue of equity shares of the face value of ₹5 each, aggregating up to ₹1700 crore and an offer-for-sale (OFS) aggregating up to ₹ 1000 crore. The offer for sale comprises equity shares of face value of ₹5 each by Prestige Estates Projects Limited (Promoter Selling Shareholder)," the company said.
Prestige Estates said that its board’s hospitality fund-raising committee has approved the company’s participation in the OFS.
PHVL said in a statement that it plans to use about ₹1,121 crore from the IPO proceeds mainly to repay or prepay loans. This includes loans worth ₹397 crore taken by the company and its key subsidiaries—Sai Chakra Hotels Private Limited and Northland Holding Company Private Limited. The company will invest ₹724 crore in these subsidiaries to help pay off those loans.
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Expansion of the hospitality portfolio
The IPO comes as Prestige Hospitality aims to strengthen its hotel sector position.
As of December 31, 2024, Prestige Hotel Ventures Limited had seven hotels in operation with 1,445 rooms (also called keys). Of these, 1,255 rooms are currently being used, while one hotel with 190 rooms is under renovation.
The company is also building three new hotels with a total of 951 rooms over 1.88 million sq. ft. and plans to build nine more hotels with 1,558 rooms across 2.64 million sq. ft. in the future.
Between FY22 and the end of 2024, the company grew its number of operating rooms at an average annual rate of 6.89%. Its hotels are in major cities like Bengaluru, Delhi-NCR, Mumbai, Goa, Hyderabad, and Chennai.
The portfolio includes convention centre hotels, business hotels, serviced apartments, and golf resorts.
Prestige Hotel Ventures Limited earned ₹662.68 crores from its hospitality services in the nine months ending December 31, 2024, up from ₹560.34 crores during the same period in 2023.
For the full financial year, revenue from hospitality services rose to ₹795.70 crores in FY24, compared to ₹636.17 crores in FY23 and ₹191.72 crores in FY22. This shows a strong growth rate, with revenue increasing at an average of 103.73% annually between FY22 and FY24.
