Grand Continent Hotels IPO Opens Soon – Check Price, Allotment, and Key Dates!

Grand Continent Hotels is set to launch its initial public offering (IPO) on March 20, 2025. The IPO will remain open for subscription until March 24, 2025. This offering is structured as a Book Built Issue, where the company aims to raise approximately ₹74.46 crores. The IPO comprises a fresh issue worth around ₹70.74 crores and an offer for sale (OFS) of up to 3,28,800 equity shares with a face value of ₹10 each.

IPO Price Band and Quota Allocation

The price band for the Grand Continent Hotels IPO has been set between ₹107 to ₹113 per share. The allocation of shares will be divided among different investor categories as follows:

• Retail Investors – 35% of the offering

• Qualified Institutional Buyers (QIBs) – 50% of the offering

• High Net-Worth Individuals (HNIs) – 15% of the offering

Allotment and Listing Details

The basis of allotment for the IPO is scheduled to be finalized on March 25, 2025. Following the allotment process, Grand Continent Hotels is expected to list on the National Stock Exchange (NSE) on March 27, 2025.

Financial Performance

Grand Continent Hotels has shown notable financial growth over the past year. The company reported a revenue of ₹31.53 crores for the fiscal year 2024, reflecting a significant increase from ₹17.05 crores in 2023. Similarly, the company’s net profit rose to ₹4.12 crores in 2024, up from ₹1.05 crores in 2023.

Use of Proceeds

The proceeds from the fresh issue are expected to be used to support the company’s growth initiatives and strengthen its financial position. The company’s improved financial performance indicates a positive trend, positioning it for potential future expansion.

This IPO marks a key milestone for Grand Continent Hotels as it looks to leverage the capital markets to fuel its next phase of growth.

Grand Continent Hotels IPO: Detailed Overview

Grand Continent Hotels is preparing to launch its initial public offering (IPO), offering investors an opportunity to participate in its growth story. Below are the key details regarding the IPO:

IPO Opening and Closing Dates

The Grand Continent Hotels IPO will open for subscription on March 20, 2025 and will close on March 24, 2025. During this period, interested investors will have the opportunity to place their bids within the specified price range.

Face Value and Price Band

The face value of each equity share has been set at ₹10. The IPO price band has been determined between ₹107 to ₹113 per share, allowing investors to bid within this range based on market demand and valuation.

Issue Size and Structure

The total issue size of the IPO is approximately ₹74.46 crores. This includes:

• Fresh Issue: The company plans to raise approximately ₹70.74 crores through the issuance of new shares. The proceeds from the fresh issue are expected to be used for business expansion and other corporate purposes.

• Offer for Sale (OFS): Around 3,28,800 equity shares will be offered by existing shareholders, allowing them to partially offload their holdings.

Issue Type

The Grand Continent Hotels IPO is a Book Built Issue, which means the final price will be determined based on the demand from institutional and retail investors during the bidding process.

Listing Platform

After the completion of the IPO process, Grand Continent Hotels’ shares are expected to be listed on the NSE SME platform, providing liquidity and market visibility for the company’s shares.

Quota Allocation

The IPO includes reservations for different categories of investors, as per the following structure:

• Retail Investors: Not more than 35% of the total issue size is reserved for retail investors.

• Qualified Institutional Buyers (QIB): Up to 50% of the issue size is allocated for QIBs.

• Non-Institutional Investors (NII): Not more than 15% of the issue size is earmarked for high-net-worth individuals and other non-institutional investors.

This IPO represents an important step for Grand Continent Hotels as it seeks to strengthen its market presence and capitalize on growth opportunities.

 

Grand Continent Hotels IPO: Market Lot and Application Details

Investors interested in subscribing to the Grand Continent Hotels IPO will need to be aware of the specific market lot requirements and application amounts. Here are the detailed insights into the lot size and investment structure:

Minimum and Maximum Lot Size for Retail Investors

The minimum market lot for the Grand Continent Hotels IPO has been set at 1,200 shares. This means that retail investors will need to apply for at least 1,200 shares in a single lot. Based on the upper end of the price band (₹113 per share), the minimum application amount will be approximately ₹1,35,600 (1,200 shares × ₹113).

Retail investors are allowed to apply for a maximum of 1 lot only, which amounts to 1,200 shares and a total investment of ₹1,35,600 at the highest price band.

Lot Size for High Net-Worth Individuals (HNIs)

For high net-worth individuals (HNIs), the minimum lot size requirement is higher. HNIs must apply for at least 2 lots, which equals 2,400 shares. At the upper price band of ₹113 per share, the minimum application amount for HNIs will be around ₹2,71,200 (2,400 shares × ₹113).

Summary of Lot Size and Investment Amount

 

Investment Guidelines

Since the IPO is structured as a Book Built Issue, the final price will be determined based on the demand from investors during the subscription period. Investors need to ensure that they apply for the correct lot size and meet the minimum investment criteria to avoid any rejection of their application.

 

Grand Continent Hotels IPO: Important Dates and Timeline

Grand Continent Hotels has announced the key dates for its upcoming initial public offering (IPO). Below is a detailed overview of the IPO timeline, including the subscription period, allotment date, refund process, and listing schedule:

IPO Opening and Closing Dates

The Grand Continent Hotels IPO will open for subscription on March 20, 2025. During this period, investors will have the opportunity to place their bids within the specified price band. The subscription window will close on March 24, 2025. Investors must ensure that their applications are submitted within this period to be considered for allotment.

Basis of Allotment

The basis of allotment for the Grand Continent Hotels IPO will be finalized on March 25, 2025. This is when the company and the registrar will determine how the shares will be allocated among the different categories of investors (retail, QIB, and HNI) based on the demand and subscription levels.

Refund Process

For investors who do not receive an allotment, the refund process will begin on March 26, 2025. The funds will be credited back to the investors’ bank accounts or payment sources used during the application process.

Credit to Demat Accounts

Successful allottees will have their shares credited to their Demat accounts on March 26, 2025. Investors should ensure that their Demat account details are accurate and up to date to avoid any issues with the credit process.

Listing Date

Grand Continent Hotels’ shares are expected to be listed on the NSE SME platform on March 27, 2025. This is when the company’s shares will become available for trading on the stock exchange, allowing investors to buy and sell shares based on market demand.

Summary of Key Dates

 

Investors are encouraged to keep track of these dates to ensure they don’t miss any important steps in the IPO process.

 

Promoters of Grand Continent Hotels

The promoters of Grand Continent Hotels are Mr. Ramesh Siva and Mrs. Vidya Ramesh. They have played a key role in establishing and expanding the company’s presence in the hospitality sector, focusing on providing affordable yet high-quality services to guests.

About Grand Continent Hotels

Grand Continent Hotels was incorporated in 2011 and has grown into a well-established player in the mid-scale hotel sector in India. The company operates in the upper-mid, mid-priced, and economy hotel segments, targeting middle-class guests and business travelers by offering quality services at competitive rates.

As of September 30, 2024, Grand Continent Hotels, along with its joint venture (JV) partners, operates 16 hotel properties with a total of 753 hotel keys across several key locations in South India, including:

• Karnataka (Bengaluru)

• Tamil Nadu (Hosur)

• Goa (Anjuna)

• Andhra Pradesh (Tirupati)

• Telangana (Secunderabad)

Foundation and Growth

The foundation of Grand Continent Hotels dates back to October 2010, when the company’s promoter first entered the hospitality industry by building its first hotel, Grand Continent, with 54 rooms. Over the years, the company has expanded significantly, particularly in Bengaluru, where it now operates 10 hotels with a total of 458 rooms as of September 30, 2024. This expansion reflects the company’s strategic focus on strengthening its domestic footprint while maintaining a high standard of service.

Grand Continent Hotels’ business model emphasizes a value-for-money approach, ensuring that guests receive excellent service at affordable rates. This has helped the company build a strong reputation among middle-class travelers and business guests.

 

Financial Performance

Grand Continent Hotels has shown steady growth in its financial performance over the past few years. Below is a detailed summary of the company’s key financial results:

1. Fiscal Year 2024 Performance

• The company reported a revenue of ₹31.53 crores in the financial year 2024, marking a significant increase from ₹17.05 crores in 2023.

• Profit after tax (PAT) for FY2024 stood at ₹4.12 crores, reflecting a substantial rise from ₹1.05 crores in FY2023.

• The company’s total expenses for 2024 amounted to ₹26.01 crores, compared to ₹15.15 crores in the previous year.

• Total assets increased from ₹42.26 crores in FY2023 to ₹73.91 crores in FY2024, indicating improved asset strength and business expansion.

2. September 2024 (Six-Month Performance)

For the period ended September 30, 2024, the company recorded:

• Revenue of ₹31.86 crores

• Expenses of ₹23.86 crores

• Profit after tax (PAT) of ₹6.81 crores

• Total assets of ₹97.94 crores

This suggests that the company’s financial health and profitability have been improving consistently over time.

3. Historical Performance

• In FY2022, Grand Continent Hotels reported revenue of ₹6.03 crores and a loss of ₹0.79 crores due to higher expenses of ₹7.67 crores.

• Total assets in FY2022 stood at ₹34.37 crores.

• The significant jump in revenue and profit from FY2022 to FY2024 highlights the company’s successful efforts in expanding its operations and improving profitability.

Financial Metrics and Valuation

The company’s key financial ratios and performance indicators for FY2024 reflect a positive trend:

• Return on Equity (ROE): The ROE stands at 0.25%, indicating the company’s ability to generate returns on shareholders’ equity.

• Return on Capital Employed (ROCE): The ROCE is 0.17%, showing how effectively the company is using its capital to generate profit.

• Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) Margin: The EBITDA margin for FY2024 is 31.58%, reflecting strong operational efficiency.

• Profit After Tax (PAT) Margin: The PAT margin stands at 13.05%, showing that the company retains a healthy portion of its revenue as net profit.

• Debt-to-Equity Ratio: The company’s debt-to-equity ratio is 1.13, indicating a moderate level of financial leverage.

• Earnings Per Share (EPS): The basic EPS for FY2024 is ₹2.54, representing the portion of the company’s profit allocated to each outstanding share.

• Price-to-Earnings (P/E) Ratio: The P/E ratio is 42.13, which reflects the market’s valuation of the company’s earnings.

• Return on Net Worth (RoNW): The RoNW is 26.67%, indicating how well the company is generating returns on shareholder investments.

• Net Asset Value (NAV): The NAV stands at ₹75.17 per share, representing the underlying value of the company’s assets after liabilities.

Grand Continent Hotels IPO: Peer Group Comparison, Objectives of the Issue, and Market Reviews

Peer Group Comparison

To understand Grand Continent Hotels’ market positioning and financial standing, it is useful to compare the company with other listed players in the hospitality sector. Below is a detailed comparison with its industry peers, including Lemon Tree Hotels Limited, Sayaji Hotels Limited, and Royal Orchid Hotels Limited:

1. Lemon Tree Hotels Limited

• Earnings Per Share (EPS): ₹1.88

• Price-to-Earnings (P/E) Ratio: 67.79

• Return on Net Worth (RoNW): 12.28%

• Net Asset Value (NAV): ₹19.52 per share

• Income: Not disclosed

2. Sayaji Hotels Limited

• Earnings Per Share (EPS): ₹8.18

• Price-to-Earnings (P/E) Ratio: 32.38

• Return on Net Worth (RoNW): 7.04%

• Net Asset Value (NAV): ₹90.49 per share

• Income: Not disclosed

3. Royal Orchid Hotels Limited

• Earnings Per Share (EPS): ₹17.68

• Price-to-Earnings (P/E) Ratio: 21.99

• Return on Net Worth (RoNW): 25.09%

• Net Asset Value (NAV): ₹75.88 per share

• Income: Not disclosed

Peer Group Insights

• Compared to Lemon Tree Hotels, Sayaji Hotels, and Royal Orchid Hotels, Grand Continent Hotels shows a competitive performance in terms of profitability and return on equity.

• Grand Continent Hotels’ Return on Net Worth (26.67%) stands higher than its peers, indicating that the company is generating stronger returns on shareholder equity.

• The Earnings Per Share (EPS) for Grand Continent Hotels is ₹2.54, which is lower than Sayaji Hotels and Royal Orchid Hotels but reflects a steady upward trend in financial growth.

• The P/E Ratio of 42.13 for Grand Continent Hotels places it between Lemon Tree and Sayaji Hotels, suggesting a moderate market valuation relative to its earnings.

Objectives of the Issue

The proceeds raised from the Grand Continent Hotels IPO are planned to be utilized for the following purposes:

1. Repayment and/or Prepayment of Outstanding Borrowings

• A portion of the IPO proceeds will be used to repay or prepay certain outstanding loans and financial liabilities. This will help reduce the company’s overall debt, improve the debt-to-equity ratio, and strengthen the company’s financial position.

2. Expansion of Hotel Properties in India

• Grand Continent Hotels plans to use part of the funds to expand its network of hotel properties across India. This includes upgrading existing hotels and opening new ones to increase capacity and improve customer service.

3. General Corporate Purposes

• The remaining funds will be allocated for general corporate purposes, including working capital needs, operational expenses, and other strategic initiatives to support business growth.

Market Reviews

Several leading financial institutions and brokerage firms are expected to provide their analysis and reviews of the Grand Continent Hotels IPO. While the official recommendations are yet to be released, the following firms are likely to issue their reports and guidance on the IPO:

• Canara Bank

• DRChoksey FinServ

• Emkay Global

• Hem Securities

• IDBI Capital

• Marwadi Shares

• Nirmal Bang

• SBICAP Securities

• Sharekhan

• SMC Global

• Sushil Finance

• Swastika Investmart

• Ventura Securities

• Geojit

• Reliance Securities

• Capital Market

• BP Wealth

• ICICIdirect

• Choice Broking

These reviews will provide insights into the company’s financial strength, market position, and future growth potential. Investors often consider such reviews before making an informed decision regarding their participation in the IPO.