Juniper Hotels Aims for ₹1,800 Crore from IPO, Plans to Repay Borrowings

Juniper Hotels Ltd, which operates under the “Hyatt” brand, has filed preliminary paperwork with the capital markets regulator to raise ₹1,800 crore (approximately $241 million) through an initial public offering (IPO). The offering will consist entirely of fresh equity shares, with no components for the sale of existing shares.

The IPO will utilize a book-building process for allocation, which will be structured as follows: a minimum of 75% of the issue will be reserved for qualified institutional buyers on a proportional basis, 15% for non-institutional investors, and the remaining 10% for retail individual investors.

Moreover, Juniper Hotels is exploring the option to issue additional equity shares via private placement for cash consideration of up to ₹350 crore (around $47 million), pending discussions with the lead bankers on the issue. If executed successfully, this private placement could lower the scale of the new issue.

The net proceeds from the IPO, totaling ₹1,500 crore (approximately $201 million), are intended to fund general corporate purposes, including repayments or redemptions of existing borrowings, either in full or part, as well as paying accrued interest.

Recent metrics indicate that Juniper Hotels has been seeing strong revenue growth, positioning it as a key player in the communications equipment sector. The company holds liquid assets that surpass short-term obligations, while maintaining a moderate debt level. Although it has not been profitable over the past year, it is trading at a relatively high revenue valuation multiple and is near its 52-week high.

Juniper Hotels is co-owned by Saraf Hotels Limited and Two Seas Holdings Limited, a subsidiary of the international hospitality group. As of June 30, 2023, it has been noted for possessing the second-largest geographical footprint and the most extensive inventory of upper-tier branded serviced apartments in Mumbai and New Delhi.

In the fiscal year 2023, Juniper Hotels’ operational revenue more than doubled, rising from ₹308.69 crore ($41 million) in FY22 to ₹666.85 crore ($89 million). Concurrently, its net loss decreased from ₹188.03 crore ($25 million) in FY22 to ₹1.5 crore ($200,000). Among its competitors, it achieved the second-highest EBITDA margin for FY 2023, surpassed only by Lemon Tree Hotels Ltd.

Despite strong returns over the last three months and a significant price increase over the past six months suggesting a compelling investment opportunity, potential investors should be aware that the company does not currently provide dividends to shareholders.

The book-running lead managers for the IPO are JM Financial Limited, CLSA India Private Limited, and ICICI Securities Limited, while KFin Technologies Limited will serve as the registrar. The company’s equity shares are anticipated to be listed on both the BSE and NSE.

This article was generated with AI support and reviewed by an editor.