Ventive Hospitality IPO

Ventive Hospitality IPO Details

Ventive Hospitality IPO Date

The Ventive Hospitality IPO will open for subscription on  December 20, 2024, and the closing date for the IPO is December 24, 2024, according to the offer document filed by the company with SEBI. After this, investors are expected to be updated about the allotment status on Wednesday, December 26, 2024.

Investors who have been allotted shares can expect them to be credited to their demat account on December 27, 2024. The shares will tentatively be listed on the NSE and the BSE on Monday, December 30, 2024. 

Ventive Hospitality IPO Price Band

The IPO is entirely a fresh issue. The IPO price band has been set between ₹610 and ₹643 per share. Interested investors can choose a price within this band to apply for the IPO. 

The IPO is a book-building issue of ₹1,600 crore, with a fresh issue of 2.49 crore shares (totalling ₹1,600 crore). 

The Ventive Hospitality IPO listing price will be determined on December 30, 2024. The listing price is the price at which a company’s shares debut on the stock exchanges.

Ventive Hospitality IPO Lot Size

The Ventive Hospitality IPO details have been declared. The minimum lot size for an application is 23 shares and in multiples thereof. Meanwhile, the IPO issue size is approximately ₹1,600 crore. 

Ventive Hospitality IPO Objective

Net IPO proceeds will be utilised to repay/ prepay certain outstanding borrowings availed by the company and its step-down subsidiaries. Part of the IPO proceeds will also be used for general corporate purposes. 

About Ventive Hospitality

Ventive Hospitality is a hospitality asset owner primarily focused on luxury offerings across business and leisure segments.

The company has two key business segments, including hotel operations and four annuity assets. Its hospitality assets are operated or franchised by global operators, comprising Marriott, Hilton, Minor, and Atmosphere. It has a proven record of acquiring and developing marquee hotel assets spread across various geographies and several hospitality segments.

As of September 30, 2024, its portfolio includes 11 operational hospitality assets with 2,036 keys across the luxury, upper-scale, and upscale segments. It operates hospitality assets like JW Marriott, Ritz-Carlton, and other upscale properties in Pune, Bengaluru, and the Maldives.  

Under its hotel operations, the company earns revenue from room income, food and beverage sales, and other hotel services, contributing 50.9% to overall revenue in FY24. The average room rate (ARR) stood at ₹19,975 in FY24 compared to ₹20,834 in FY22. Meanwhile, the occupancy improved from 34.82% in FY22 to 59.47% in FY24. Revenue per available room (RevPAR) also increased from ₹7,255.19 in FY22 to ₹11,880.69 in FY24.    

The company’s annuity assets segment contributes 48.61% to total revenue in FY24. This segment earns revenue from rental income, maintenance and parking charges. As of September 30, 2024, the total leasable area is 3.40 msf, and the committed occupancy is 95.55%. 

Between FY22 and FY24, the company's revenue from operations rose at a CAGR of 44.42%, while net profit rose 137.72% during the same period. Meanwhile, India's travel and tourism sector contributed ₹19.1 trillion of GDP in 2023 and is expected to contribute over ₹43 trillion by 2034. Foreign tourists in India will cross 30 million by 2037 (from 9.3 million in 2023), as per the Hotel Association of India estimate, while the Maldives received 1.9 million foreign tourists in 2023 from various countries. This healthy industry trend offers a great opportunity for the company to expand its business.   

Now, Ventive Hospitality Limited is launching its initial public offering (IPO), which consists entirely of a fresh issue of 2.49 crore shares, each with a face value of ₹1. This aggregates to ₹1,600 crore. Its shares will be listed on the NSE and BSE.

Company Name: Ventive Hospitality Limited

Company Established On: February 12, 2002

Company Type: Private Limited Company

CEO: Ranjit Bharat Batra

Financial snapshot

Ventive Hospitality IPO Analysis

Strengths and Opportunities

1. Its premium hospitality assets, including JW Marriott, Pune, The Ritz-Carlton, Pune, Conrad, Maldives, Anantara, Maldives, and Raaya by Atmosphere, Maldives, contribute over 80% of its pro forma revenue from hotel operations. 
2. Its operating portfolio consists of seven hospitality assets with 1,331 keys developed by the company and its promoters and four assets with 705 keys acquired by it. 
3. Its promoters include Panchshil Promoters, affiliated with Panchshil Realty, one of India’s leading luxury real estate developers, and the BRE promoters, affiliated with Blackstone.
4. The company is led by a professional and experienced management team and a board of directors with expertise in private equity, investments, real estate and the hospitality industry.
5. Its asset management practices are driven by comprehensive procedures aimed at improving the operational performance of its assets through increased occupancy rates, revenue generation and enhanced cost efficiencies.
6. Throughout the year, it engages in omnichannel marketing and consumer engagement activities while implementing promotional campaigns through travel agents and wholesalers.
7. The company is well-positioned to leverage the hospitality industry tailwind.

Risks and Threats

1. The company is reliant on third parties for the quality of services of its hospitality assets, which are operated by or franchised by third-party brands.
2. It does not have a consolidated operating history through which its overall performance can be evaluated and has incurred losses in the past.
3. Its hospitality business is subject to seasonal and cyclical fluctuations that could result in variation in its results of operations and cash flows.
4. As of September 31, 2024, the company had outstanding borrowings worth ₹3,609.5 crore. Any breach of financial agreements or inability to meet debt obligations could impact its business.
5. In the past, the company and its subsidiaries have delayed payment of statutory dues.
6. Negative media coverage or customer reviews about its hospitality and annuity assets could impact its ability to attract customers or tenants.
7. Risks associated with safety, security and crisis management could expose the company to significant reputational damage and financial loss.
8. It is exposed to risks relating to the economic, political, regulatory, legal or social environments of the geographies in which it operates. 
9. Any downgrading of India, Sri Lanka, or Maldives' debt ratings by a domestic or international rating agency could increase their borrowing costs and access to debt capital markets.

How to apply for the Ventive Hospitality IPO?

If you are interested to invest in Ventive Hospitality IPO, following are the steps to apply:

1. Login to your Upstox account, using your six-digit PIN
2. After successfully logging in, click on ‘Discover’
3. On the Discover tab, you will find the ‘Invest in IPO’ section
4. Under the Invest in IPO section, look for the ‘Ventive Hospitality IPO’ tab and click on it
5. Now fill in all the required information, like ‘bid price’ and ‘lot size’
6. Confirm and click on ‘Apply’
7. Accept the mandate on your UPI app

You can also pre-apply for the Ventive Hospitality IPO on Upstox which usually begins a day before the IPO opens for subscription.