The initial public offer (IPO) of Juniper Hotels, which runs hotels under the “Hyatt” brand, opened for subscription. Through the public offer, the company plans to raise around Rs 1,800 crore.

The IPO with a face value of Rs 10 is entirely a fresh equity with no offer for sale (OFS) component. About 75% of the IPO is reserved for qualified institutional buyers, 15% for non-institutional investors and the rest 10% for retail investors.

The company proposes to use the net proceeds towards repayment of debt availed by the company and its subsidiaries and for general corporate purposes.

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Juniper Hotels IPO review

Despite a boom in hospitality and tourism over the past few years, the continuous loss making status and asset heavy business model weighed on analysts’ views, who were mixed on the IPO.

“Considering the asset-heavy business model of the company, rising debt levels and continued loss-making status, we would recommend an Avoid rating for the issue. We would reconsider the company for further evaluation following sustained financial performance over the next few quarters,” said Stoxbox.

Meanwhile, Ventura Securities gave a subscribe recommendation saying the company’s strong and well recognized parentage and robust asset management capabilities with a focus on enhancing operating efficiency and profitability is expected to drive growth.

Juniper Hotels IPO price band

Juniper Hotels has fixed a price band of Rs 342-360 per share for its maiden public offer. Investors can bid for 40 shares in one lot and in multiples thereafter.

Juniper Hotels GMP

In the unlisted market, the company’s shares were trading with a marginal premium of Rs 10 just prior to the subscription opening.

Other details

Juniper Hotels is co-owned by Saraf Hotels and Two Seas Holdings, an affiliate of the prominent global hospitality entity, Hyatt Hotels Corp.

It functions as a luxury hotel development and ownership enterprise, and owns 20% of the total 1836 Hyatt affiliated keys in India as of June 2023. The company manages a diverse portfolio consisting of seven hotels and serviced apartments.

The hotels and serviced apartments span across various categories including luxury, upper upscale, and upscale, located across six strategic cities in Mumbai, Delhi, Ahmedabad, Lucknow, Raipur, and Hampi. Notably, the Grand Hyatt Mumbai Hotel and Residences holds the distinction of being the largest hotel in India.

For the fiscal year 2023, revenue from operations increased by 116% to Rs 667 crore against Rs 309 crore a year ago. Net loss narrowed to Rs 1.5 crore in fiscal 2023 over Rs 188.03 crore in fiscal 2022.

JM Financial, CLSA India, and ICICI Securities are the book-running lead managers, and KFin Technologies is the registrar of the offer.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)

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