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  • Writer's pictureJatin Agarwal

Apeejay Surrendra Park Hotels IPO

Updated: Feb 4

Apeejay Surrendra Park Hotels IPO: A Beacon in Hospitality Sector Growth


Apeejay Surrendra Park Logo

Company Overview

Apeejay Surrendra Park Hotels Limited, known for its distinguished presence in the Indian hospitality industry, operates under renowned brand names such as "THE PARK", "THE PARK Collection", "Zone by The Park", and "Flurys". With a legacy dating back to 1987, the company has become synonymous with luxury and boutique hotel experiences, expanding its footprint across major cities in India with a total of 27 hotels offering over 2,000 rooms as of August 2023​.

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Company Financials

The financial growth trajectory of Apeejay Surrendra Park Hotels is notable, with a significant year-on-year revenue growth reported in FY23. The company's efforts to rebound from the pandemic's impact are evident in its improved profitability and operational efficiency​.


For the fiscal year ending March 31, 2023, Apeejay Surrendra Park Hotels Limited demonstrated significant financial growth with revenue increasing by 95.81% and profit after tax (PAT) escalating by 270.42% compared to the previous fiscal year.

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Company SWOT Analysis

  • Strengths: Diverse brand portfolio, strategic location of properties, high occupancy rates, and an experienced leadership team.

  • Weaknesses: Exposure to risks related to property development delays, non-compliance with financing agreements, and dependence on online travel agents.

  • Opportunities: Expansion into new geographies, potential for high demand in India's tourism sector, and leveraging the "Digital India" initiative.

  • Threats: Competitive market, regulatory changes, and operational risks including cash handling and fraud​.

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Hotel Image

Company Valuation

The market capitalization of Apeejay Surrendra Park IPO is projected at ₹3307 Crores, with key valuation metrics as follows:

  • Debt/Equity: 0.99

  • Return on Net Worth (RoNW): 9.03%


The comparative analysis with its peers reveals the company is positioned competitively in the market with a Price/Earnings (P/E) ratio that aligns with industry standards, indicative of its growth potential and market positioning

IPO Overview

The IPO marks a pivotal moment for Apeejay Surrendra Park Hotels, aimed at further cementing its leadership in the hospitality industry and driving future growth​.

IPO Details

  • IPO Opening Date: February 5, 2024

  • IPO Closing Date: February 7, 2024

  • Listing Date: February 12, 2024

  • Lot Size: 96 Shares

  • Price Band: ₹147 to ₹155 per share

  • Issue Size: ₹920 Crores

  • Minimum Investment (retail): ₹14,880​

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Objectives of the Issue

The primary objectives include repayment or prepayment of certain outstanding borrowings and general corporate purposes, aiming to strengthen its financial structure and support ongoing operational needs​.

IPO Grey Market Premium (GMP)

The GMP indicates a positive market sentiment towards the IPO, suggesting a healthy investor interest and potential for listing gains​. The current GMP is around 45%.

Conclusion

Given the company's strategic positioning, strong brand portfolio, and operational track record, the Apeejay Surrendra Park Hotels IPO presents a compelling proposition for investors looking for exposure to India's burgeoning hospitality sector. The expansion plans and debt repayment strategy further bolster the case for long-term growth prospects​.

Disclaimer

All information is provided for educational and informational purposes only. Data is fetched from publicly available sources such as the DRHP filed by the company and other reliable sources. The website or the author takes no guarantee for the accuracy of the data; however, we have tried our best to present accurate data to our readers. Please consult a financial advisor or do your own analysis before investing/trading in the stock market.

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