Brigade Hotel Ventures IPO opens today; GMP up 9%; should you subscribe?

Business Standard

4 days ago

Brigade Hotel Ventures IPO opens for public subscritpion: Hotels chain operator Brigade Hotel Ventures is set to launch its initial public offering (IPO) today, July 24, 2025. At the upper end, the company seeks to raise ₹759.60 crore from the public issue, which comprises an entirely fresh issue of 84.4 million equity shares. Brigade Hotel Ventures has announced that it has already raised ₹324.72 crore from the anchor investors on the bidding concluded on July 23. The anchor book saw participation from investors, including SBI Mutual Fund (MF), 360 One MF, Axis MF, Motilal Oswal MF, Bandhan MF, Edelweiss MF, and Nuvama MF.
The brokerages remain optimistic on the public offering of Brigade Hotel Ventures for the long-term investment outlook, citing the company's expansion and improving financial performance.
Here are the key details of Brigade Hotel Ventures IPO:
Brigade Hotel Ventures IPO price band, lot size
Brigade Hotel Ventures IPO is being offered at a price band of ₹85–90 per share, and a lot size of 166 shares. Thus, the investors can bid for a minimum of 166 shares and in multiples thereof.
A retail investor would require ₹14,940 to bid for one lot or 166 shares of Brigade Hotel Ventures IPO. A retail investor can, however, bid for a maximum of 13 lots or 2,158 shares of Brigade Hotel Ventures IPO with an investment of ₹1,94,220.
Brigade Hotel Ventures IPO grey market premium (GMP)
The unlisted shares of Brigade Hotel Ventures were commanding a decent premium in the grey markets ahead of the opening of their public issue on Thursday. Sources tracking unofficial market activity revealed that Brigade Hotel Ventures shares were trading at ₹98 apiece, reflecting a grey market premium (GMP) of ₹8 or 8.89 per cent over the upper price band of ₹90.
Brigade Hotel Ventures IPO timelines
The three-day subscription window to bid for the Brigade Hotel Ventures IPO is likely to close on Monday, July 28, 2025. Following that, the basis of allotment of Brigade Hotel Ventures IPO shares is expected to be finalised on Tuesday, July 29, 2025, and shares will be credited to successful allottees' demat accounts on Wednesday, July 30, 2025.
Shares of Brigade Hotel Ventures are set to make their D-Street debut tentatively on Thursday, July 31, 2025.
Brigade Hotel Ventures IPO registrar, lead manager
Kfin Technologies serves as the registrar for the Brigade Hotel Ventures IPO, while JM Financial is the sole book-running lead manager for the issue.
Brigade Hotel Ventures IPO objectives
The company proposes to utilise the proceeds from the public issue for the repayment or prepayment, either in full or in part, of certain outstanding borrowings availed by the company and its material subsidiary, SRP Prosperita Hotel Ventures Limited. A portion of the proceeds will also be used for the payment of consideration towards the purchase of an undivided share of land from the Promoter, BEL. Additionally, the funds will support the company's inorganic growth plans through potential unidentified acquisitions and other strategic initiatives. The remaining proceeds will be allocated towards general corporate purposes.
Should you subscribe to Brigade Hotel Ventures IPO?
Canara Bank Securities – Subscribe for long-term
Analysts at Canara Bank Securities have recommended that investors bid for the Brigade Hotel Ventures IPO with a long-term outlook.
"Its high occupancy, strategic alliances with global hotel chains, strong brand equity, and premium location focus enhance its long-term prospects."
Brigade Hotel Ventures IPO is valued at a steep P/E of 125x and P/B of 32.26x (FY25), which the analysts said is well above the industry averages of 92.53x and 4.95x respectively.
"We recommend a Subscribe rating only for well-informed investors with a long-term outlook, given the company's aggressive expansion, improving financial performance, and strategic advantage in high-growth hospitality corridors," wrote the analysts in their report.
SBI Securities – Subscribe for long term
Brokerage firm SBI Securities has also recommended investors to subscribe to the issue at the cut-off price for the long term. The brokerage, in its report, highlighted that the company has demonstrated strong financial growth, with a CAGR of 15.6 per cent in revenue, 30 per cent in Ebitda, and 73.2 per cent in PAT over FY23–FY25. However, it also noted that the company has a negative Reserves & Surplus of ₹196 crore as of March 2025, owing to accumulated losses in the past.
"Out of the total IPO proceeds of ₹760 crore, BHVL will utilise approximately ₹468 crore towards debt repayment, which will lead to a reduction in the debt-to-equity ratio to below 1.0x from the current 7.1x, and an improvement in profitability as interest cost savings of ₹45 crore will flow through the P&L. Going forward, trends in occupancy levels and average room rates (ARR) of the company will be key monitorables," said the brokerage in its report.
"At the upper price band of ₹90, BHVL is valued at a FY25 EV/Ebitda of 19.8x. We recommend subscribing at the cut-off price for the long term."
About Brigade Hotel Ventures
Brigade Hotel Ventures Limited is an owner and developer of hotels in key Indian cities, with a primary focus on South India. The company is the second-largest owner of chain-affiliated hotels and hotel rooms in South India—including the states of Karnataka, Tamil Nadu, Kerala, Andhra Pradesh, Telangana, and the Union Territories of Lakshadweep, Andaman and Nicobar Islands, and Puducherry—among major private hotel asset owners (defined as investors owning at least 500 rooms across India).